Acurast Investment Memo

Investment Details

Project Name:  Acurast Association
Place of Incorporation: Dammstrasse 16, 6300 Zug, Switzerland
Series: Public Token Sale
Pre-Money Valuation: $100M USD
Round Size: $5M USD
Investment & Entity: $1.5M USD (Token)/ Scytale Polkadot Ecosystem Fund
Expected TGE: Q2 2025
Website: https://acurast.com/ 

Project Overview

Vision

Acurast harnesses the untapped power in billions of mobile devices worldwide to create the first truly scalable and secure decentralized compute network. By leveraging smartphones' built-in hardware security modules, they ensure verifiable confidential compute at an unprecedented scale—far beyond what traditional data centers can achieve. The Acurast approach democratizes access to compute power, enabling anyone with a smartphone to participate in and benefit from the AI revolution and beyond, transforming personal devices from mere consumers to essential contributors in the next generation of computing infrastructur

Papers AG: History & Structure

Acurast’s founding team unites decades of mobile cybersecurity and confidential computing expertise. The team has built and safeguarded mission-critical systems for defense giants (Northrop Grumman, BAE Systems, Leonardo Helicopters) and implemented secure solutions for top financial institutions (UBS, Credit Suisse, Jefferies, SwissRe, and Citigroup). Active in the cryptocurrency space since 2015, the team combines deep security expertise with years of hands-on experience in blockchain technology and decentralized systems. This unique blend of enterprise-grade security knowledge and blockchain expertise uniquely positions them to deliver Acurast's vision of secure, scalable decentralized compute.

Market & Competitors

Web2 Market

The cloud computing market is experiencing strong growth, driven by businesses seeking scalable, cost-effective, and secure solutions. Infrastructure as a Service (IaaS) and Software as a Service (SaaS) are the leading segments. However, the market is heavily concentrated, with Amazon Web Services (AWS), Microsoft Azure, and Google Cloud holding dominant positions due to economies of scale and regulatory advantages. The market is transitioning from subscription-based SaaS to usage-based IaaS, which presents significant challenges for these dominant providers. These challenges include difficulty forecasting fluctuating demand, increased competition leading to pricing wars and reduced margins, and greater customer churn due to the lack of long-term commitments inherent in IaaS. Consequently, providers must prioritize operational efficiency and continuous innovation to maintain competitiveness in this evolving landscape.  (Tamayo, Jensen, and Ramakrishnan 2024)

Decentralized Physical Infrastructure Networks (DePIN) provide cloud-like Infrastructure as a Service (IaaS) through pay-as-you-go storage and compute resources. These networks leverage decentralized platforms, allowing individuals to contribute their excess hardware (storage, bandwidth, processing power) to a shared infrastructure. This model reduces costs and barriers to entry, fostering innovation by increasing accessibility. This approach closely aligns with the emerging concept of compute-over-data. Compute-over-data is a paradigm shift where computation occurs directly at the data's storage location, eliminating the need for data transfers to centralized servers. This drastically reduces latency and enhances efficiency, particularly for demanding tasks such as Artificial Intelligence (AI) and machine learning. This methodology offers significant benefits, including: local processing, which minimizes costly and time-consuming data transfers; cost savings for AI development, especially in inference, through decentralized frameworks; and enhanced security, as local processing reduces the risk of exposing sensitive data during transfer. (Tamayo, Jensen, and Ramakrishnan 2024)

Web3 Market

Decentralized Physical Infrastructure Networks (DePIN) are blockchain-based systems that leverage physical assets (e.g., computing resources, storage devices, sensors) to provide decentralized services. DePIN projects aim to replace traditional, centralized infrastructure with decentralized alternatives, increasing transparency, reducing costs, and enhancing user sovereignty.

‍Different Categories of DePIN include but are not limited to:

• Wireless
• Energy
• Compute
• Sensor
• Logistics
• Identity

Competitors

Compute-focused DePIN projects are essential for decentralized applications by providing vital processing power. They enable decentralized cloud computing (like Akash and Render), democratize AI and machine learning (like Bittensor), facilitate data processing and analysis (like Filecoin and Arweave), and empower edge computing. These projects reduce reliance on centralized providers, offer cost-effective scaling, and enhance privacy and efficiency by processing data closer to its source.

Closest Competitors

While GPU-based compute DePIN projects are common, few integrate mobile phones. Existing mobile projects, like Theta Mobile Edge Node (Android-only) and Titan L2 (requiring app installation), have limitations compared to Acurast's proposed solution, which aims for broader iOS support and a "Lite" version. Notably, Acurast and Titan L2 are exploring a partnership to run Titan nodes on Acurast's runtime.

Product Overview

Main Products

Acurast is building a decentralized, confidential compute network using mobile devices, offering secure, verifiable execution for Web3 applications. It provides a scalable platform for developers, enabling unique use cases without centralized servers. A forthcoming token launch will incentivize community participation and governance, aiming to redistribute compute power and establish a sustainable, trust-based Web3 infrastructure.

Value Offering of Products

Acurast leverages mobile devices for unparalleled compute scale and accessibility, fostering a community-driven DePIN ecosystem with token incentives. It ensures verifiable, confidential execution through secure hardware, preventing fraud. Its decentralized, hardware-verified infrastructure provides resilience, aligning with Web3 principles for future-proof applications.

Core Stakeholders

Acurast's ecosystem caters to diverse participants: Processors contribute hardware (phones) to earn rewards, Developers utilize this compute power, Community Members support the vision, and Stakers secure the network. This collaborative model fosters a decentralized and accessible compute infrastructure.

Future Products Roadmap

Phase 1: Mainnet Launch Preparation

• Public release of iOS.
• New reward and pricing system, more details in February.
• Introduction of staking and economic security.
• Launch of Cloud Rebellion Season 3 (03.02.25).
• Community Contribution and Activation Initiatives.
• Confidential AI, further enabling developers to build on the already established environment for AI.

Phase 2: Mainnet Launch

• TGE (April 2025)
• Mainnet Launch

‍Phase 3: Mainnet Growth

• These would come into focus after the launch of the Acurast mainnet launch.
• Codename Cargo: Compute Containers – Utilizing new container technology allowing to convert multiple languages into one “format”, drastically extending the ability for Acurast to support numerous new languages.
• Codename Cray: Compute Clusters – combining multiple devices to one cluster that can run heavier workloads e.g., AI training.
• Codename Bazaar: Software Marketplace – Marketplace that enables developers to distribute their applications deployed on Acurast. 
• Codename Rice: Compute Future – A DeFi twist, making Acurast’s compute capacity tradable with Futures. The first futures market for compute.

Why Acurast is Superior?

Acurast provides cost-effective and confidential compute by leveraging existing mobile devices. Its decentralized model allows for competitive pricing while ensuring attractive returns for users contributing their hardware. This approach offers a more accessible and secure alternative to traditional cloud services like AWS, with lower overheads and on-demand scalability.

Unique Selling Points

Acurast's decentralized compute network offers verifiable, scalable, accessible, and secure computing power by leveraging a global network of smartphones. This allows developers and users to benefit from transparent and tamper-proof compute while maintaining data privacy, redefining possibilities for Web3.

Difficulty of Replication

Acurast's unique combination of technical expertise in mobile security, proven operational scale (30,000+ devices, 143M+ transactions), and established community momentum creates significant barriers to entry for competitors. Replicating its decentralized mobile compute network requires specialized hardware knowledge, complex operational management, and a thriving ecosystem—advantages Acurast already possesses.

Differences to Competitors

Acurast's decentralized compute network distinguishes itself from competitors in two main categories:

1. Networks Offering Raw Compute (CPU/GPU):

• Competitors: IO.net, Akash, Render Network, Aethir rely on self-reported hardware capabilities, making them vulnerable to cheating and limiting scalability. They also lack confidential computing, exposing sensitive data to operators.
• Acurast's Advantages:
  
  • Utilizes secure hardware modules in smartphones for verifiable execution, eliminating reliance on self-reporting.
  • Offers confidential computing through tamper-resistant enclaves, protecting user data.
  • Achieves true decentralization at scale by harnessing the power of billions of smartphones, avoiding dependence on centralized data centers.
    
    

2. Networks Focusing on Trusted Execution Environments (TEEs):

• Competitors: Phala, Arcium, Oasis utilize server-grade TEEs, limiting their inclusivity and decentralization due to reliance on specialized hardware and server clusters.
• Acurast's Advantages:
  
  • Avoids data-center lock-in by enabling secure computation on consumer smartphones.
  • Achieves massive global reach and resilience through billions of smartphones.
  • Fosters inclusive participation by allowing anyone with a phone to join the network.

In essence, Acurast's approach offers a more secure, scalable, accessible, and truly decentralized alternative to existing compute solutions by leveraging the untapped potential of mobile devices.

Tokenomics

Token Utility and Tokenomics

The Acurast token has multiple utilities: it grants access to compute resources, serves as a settlement layer, secures the protocol through staking, and enables governance rights for token holders to vote on upgrades and network parameters.  Transaction fees are paid in ACU, rewarding those who provide compute power. The token distribution will follow a linear vesting schedule with no cliffs.

Token Value Accrual

Acurast employs a deflationary token model by burning 30% of ACU tokens used to reward compute providers, similar to Apple's App Store fee. ACU facilitates settlements and underpins Acurast's reputation system.  Staking is incentivized for maximum rewards, and an on-ramp (via Mt Pellerin) allows for easy fiat-to-token conversion.  The token has been reviewed by Switzerland's FINMA with no regulatory concerns.

Business Model & Traction

Core Business Model

The business model is like the Apple Appstore: Acurast is a decentralized platform that brings together compute consumers with compute providers, as well as software as a service providers with software as a service buyers. All the settlement of the offered services is done with the Acurast Token, a tax of 30% is applied on the settlement transaction automatically by the protocol and burned, allowing for a value capture in the token. 

GTM Strategy for Users and Stakeholders

Acurast drives community engagement and growth through its "Cloud Rebellion" program, KOL collaborations, and strategic partnerships. The Cloud Rebellion incentivizes users to contribute compute resources and refer others, while partnerships with projects like Nodle expand compute supply and collaborations with xcBTC showcase Acurast's confidential computing capabilities. Acurast focuses on Confidential AI use cases, enabling secure and private AI utilization. By co-founding the DePIN Association and actively participating in industry events, Acurast fosters broader DePIN adoption.  A processor bootstrapping campaign and a global ambassador program further strengthen Acurast's community and reach. This multifaceted strategy ensures a thriving ecosystem for decentralized, confidential compute.

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Traction and KPIs

• 143M+ transactions on Acurast Canary.
• Over 30’000 phones onboarded as Processors.
• Over 7’000 Deployments.
• Over 50’000 on-chain accounts.
• Over 13’000 active users in the cloud rebellion.

Partners

Acurast has established a wide range of partnerships to enhance its decentralized compute ecosystem and expand its use cases:

Compute and Infrastructure:

• Apillon: Acurast powers Apillon's Cloud Function Service, enabling serverless functions to run on its decentralized network.
• Cere Network: Integration with Cere's Decentralized Data Cloud (DDC) enhances data processing and storage for Web3 applications.
• Aleph Zero: Acurast provides decentralized compute services on Aleph Zero's privacy-enhancing blockchain.
• Aizel Network: Collaboration to revolutionize edge computing for trustless AI.
• Glue: Enhances Glue's serverless cloud infrastructure with Acurast's decentralized compute layer.
• Energy Web: Brings decentralized compute to the energy sector for sustainable solutions.
• Nodle: Enables Nodle users to run decentralized compute applications on its network.

Security and Key Management:

• Hex Trust: Serves as keyholders for tzBTC, enhancing security through distributed key management.
• Lexr Finance: Also serves as keyholders for tzBTC, integrating Acurast with its financial services.
• MT Pelerin: Partners as keyholders for tzBTC, enhancing security and reliability.

Web3 and dApp Development:

• tzBTC: Enhances tzBTC's security and scalability using decentralized compute.
• Xcavate: Enhances real-world asset data processing through decentralized compute.
• Varas: Promotes dApp development by leveraging mobile-powered cloud services.
• SubQuery: Integrates high-speed data indexing solutions for efficient on-chain data access.

Other Integrations:

• CoralApp: Pre-installs the Acurast Processor application on Coral's devices for seamless access.
• Aligned: Enables unstoppable zero-knowledge (ZK) proofs through Acurast's infrastructure.

Key Risks and Mitigations

Acurast's primary risks are commercial, including limited Web2 adoption and potential competition. To achieve sustainability, Acurast must expand beyond Web3, ensuring a smooth UX and demonstrating clear benefits to traditional enterprises. A potential oversaturation of compute resources and the commodification of its services are also concerns. Acurast plans to mitigate these risks by expanding to other devices, fostering a strong community, and incentivizing developers. The complexity of developing mobile-based compute solutions and Acurast's focus on network effects create barriers to entry for competitors. To address liquidity limitations, Acurast will release a wrapped token on Solana and Ethereum.

Team

C-Suite

Alessandro De Carli

• Co-Founder and President of the Board, Acurast (May 2022 - Present)
• Founder, Papers development studio (February 2009 - Present)
  
  • Key project: Hypergate (January 2018 - April 2022)
• Former Assistant VP of Technology, Credit Suisse (August 2014 - October 2016)
  
  • Focus: Mobile Banking Security

Pascal Brun

• Co-Founder and Committee Member, Acurast (May 2022 - Present)
• Founder, Papers development studio (September 2010 - Present)
  
  • Key projects: Hypergate (January 2018 - December 2020), AirGap (November 2017 - October 2021)

Mike Godenzi

• CTO, Acurast (May 2022 - Present)
• Former CTO, Papers (June 2019 - May 2022)
• Former Mobility Engineer, Swiss Re (January 2017 - May 2019)
• Former Mobile Framework Engineer & Mobile Solutions Engineer, Credit Suisse (January 2011 - December 2021)

Christian Killer

• Head of Research, Acurast (July 2023 - Present)
• PhD in Information Systems, University of Zurich
  
  • Thesis: "Privacy and Verifiability in Decentralized Remote Electronic Voting"

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Employee Retention Incentive

Employees have quarterly targets that they have been part of defining, for completion they'll be eligible for a bonus as well as end of the year bonus. Bonus can be paid in locked ACU tokens.

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Future Hires

On the technical side Acurast will be scaling the team based on the required skillset. For short term scaling on one-off topics Acurast will be working with seasoned Web3 software development partners like Substance Labs, PK Labs or Madfish. The focus for the next growth phase will require focused hiring and spend in marketing and business development. After the first large enterprise cases have converted an enterprise sales team is built up.

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Advisory Board

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Alain Kunz (GSR): Facilitated VC connections and market-making expertise.

Jean-Philippe Aumasson (Taurus): Security expert, driving research in Multi-Party Computation (MPC) and providing introductions to projects like Zama.

Bea Knecht (Zattoo): Ex-McKinsey consultant and founder of Europe's leading TV streaming platform, offering valuable business and scaling insights.

Matteo Cortonesi (Google): Former Credit Suisse colleague and current Google engineer, providing technical expertise.

Ogle (Glue): Recognized by CoinDesk's Most Influential 2023, contributing expertise in decentralized infrastructure and Web3 development.

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Reference List

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Bane, Dylan, and Salvador Gala. 2025. State of DePIN 2024. Messari. January 6, 2025. https://messari.io/report/state-of-depin-2024.
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Nordic Crypto. 2024. Phone Mining Crypto | Easy 3 Minute Setup Mining Acurast. YouTube video, 4:18. Published September 10, 2024. https://www.youtube.com/watch?v=bHUmP8BTOvQ&t=8s.

Tamayo, Jorge, Christopher Jensen, and Mahesh Ramakrishnan. 2024. The Next Frontier in Cloud Computing: Decentralization as a Catalyst for Disruption. Franklin Templeton Digital Assets. https://franklintempletonprod.widen.net/content/2clacwvale/pdf/cloud-computing-0724-us.pdf.

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