By Dr. Kai Wawrzinek, Co-Founder & CEO of Impossible Cloud
As Europe increasingly turns its focus toward digital sovereignty, the need has never been greater for a viable alternative to foreign-owned cloud infrastructures like AWS, Azure, and Google Cloud. I recently shared my thoughts on this topic in an article (in German) for Silicon Magazine. Today, I’d like to expand on this topic and introduce how visionary projects like Impossible Cloud Network hold such exciting potential for reshaping the cloud landscape in Europe, and the world over.
Impossible Cloud Network is a decentralized physical infrastructure network (“DePIN” for short). It is a system where physical hardware and resources, such as data centers, computing power, and storage, are distributed across multiple independent providers rather than being centralized under a single provider.
These networks are coordinated and managed through protocols using blockchain technology to allow participants to contribute resources (e.g. storage capacity) and earn for their contributions. Decentralized physical infrastructure networks (DePINs) enable quicker scalability, more resilience, and better security while providing a needed alternative to the dominant centralized cloud providers.
The major cloud providers that dominate today’s cloud industry, centralize not only technology but also user data and influence. While these platforms have undoubtedly driven innovation, they come with economic and political implications that limit user independence and flexibility.
Here in Europe, we see several critical challenges posed by this centralization. Firstly, customers can find themselves trapped by “vendor lock-in” as they face high switching costs and dependence on proprietary technologies. Secondly, U.S. legislation, like the CLOUD Act, mandates that providers hand over data to U.S. authorities upon request, even if the data is stored outside the U.S. This is fundamentally at odds with European data privacy standards, especially GDPR. For any organization striving for data sovereignty, this dynamic presents a compliance risk.
Moreover, as cloud providers operate through centralized structures, they are increasingly exposed to security risks. A single attack on one centralized node can lead to widespread disruptions. This is a vulnerability we can’t afford as we expand our reliance on digital infrastructure.
To improve digital resilience, the EU initiated the Gaia-X project to create a more self-sufficient, interconnected data infrastructure within Europe. However, despite its ambitious goals, Gaia-X has faced funding and innovation challenges that have hampered its success. In its current form, Gaia-X falls short of achieving the level of independence and resilience Europe needs in cloud technology.
This is where DePINs come into play. While Gaia-X operates through coordinated, top-down efforts, DePINs offer a market-driven approach to decentralizing cloud infrastructure. Through DePIN, we can harness the underutilized power of existing European data centers, which are ready to operate on a more resilient, decentralized framework.
DePIN networks, by design, address the inherent risks in centralized structures. With data stored redundantly across multiple nodes, there is no single point of failure, meaning DePINs are naturally more resilient to failure in the event of an attack or disaster. Furthermore, by coordinating and optimizing resources across a network of physical hardware, DePINs achieve impressive efficiency. Not only that, they reduce latency and achieve better performance through edge computing, which means locating data physically closer to its end-users.
While the DePIN model holds significant promise, it faces unique challenges in its journey toward widespread adoption. Much of DePIN’s current implementation has roots in the crypto sector, meaning payments for storage and computing services often rely on cryptocurrencies. This creates an entry barrier that must be addressed for DePIN to reach the mainstream.
Additionally, DePIN projects designed with privacy in mind often use anonymous, decentralized systems, which, while secure, pose unique risks to data recovery if login credentials are lost.
To truly scale DePIN in a meaningful way, Europe’s infrastructure must attract more B2B-driven participation. This means onboarding powerful data centers with immense untapped resources across Europe, not relying solely on individual hardware contributions. By allowing participation in fiat currency (such as euros), DePIN networks can more readily compete with current cloud services. This is what we are working on at Impossible Cloud Network.
The question of Europe’s cloud infrastructure isn’t just technical; it has profound social implications. Moving away from a centralized, monopolistic system means reclaiming control over our data, complying with European data protection laws, and building a cloud environment that supports both local needs and global competition.
For DePIN to succeed, however, we must focus on improving cloud services while maintaining competitive pricing. Only when DePINs offer cost-effective, high-quality services will we have a viable alternative to today’s cloud giants.
The future of the cloud is decentralized. DePINs offer a pathway to a more resilient, efficient, and independent cloud structure. By competing on performance, security, and pricing, DePINs have the potential to transform Europe’s cloud landscape—and provide the independence, security, and innovation needed for the digital age.
At Impossible Cloud, we’re making strides toward this vision. Through projects like our Impossible Cloud Network (ICN), we’re building a scalable, decentralized network by onboarding new hardware providers across Europe. When adoption barriers are addressed and the momentum continues, I believe we’ll soon see a European cloud landscape where reliance on hyperscalers is significantly diminished, replaced by a resilient network that serves Europe’s unique needs.
Originally published on July 25, 2024 in German for Silicon Magazine
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