In the Web3 world, “decentralization” is a core belief. Yet ironically, most applications still depend heavily on traditional cloud services like AWS and Google Cloud. This contradiction casts a shadow over the so-called decentralized ecosystem. If the cloud is the backbone of Web3 infrastructure, could its centralized nature be a ticking time bomb?

Openmesh Network was created to solve this dilemma. This emerging project champions a “decentralized and permissionless cloud,” aiming to build a native Web3, open network for computing and storage where anyone can help construct a global cloud infrastructure. Its mission? To challenge the monopoly held by centralized cloud giants.

Image: Slogan from Openmesh’s official website
(Source: https://docs.openmesh.network/)

What is Openmesh Network?

Openmesh Network is a decentralized, permissionless cloud and oracle network designed to serve as an alternative to AWS in the Web3 era. By leveraging a globally distributed network of nodes—known as Xnodes—Openmesh provides computing power, data storage, and API access. This allows developers and applications to operate seamlessly without relying on traditional cloud platforms.

In 2024, Openmesh announced a bold initiative: releasing $100 million of decentralized cloud resources to support Web3 projects. This move aims to accelerate the growth of the DePIN (Decentralized Physical Infrastructure Network) ecosystem, attract more projects to migrate to Openmesh, and highlight its potential to reduce cloud costs by up to 80%.

That same year, Openmesh officially joined Chainlink’s Cross-Chain Interoperability Protocol (CCIP) ecosystem. This integration enhances Openmesh’s role as a foundational layer for oracles and cross-chain data infrastructure, enabling more advanced decentralized use cases such as DeFi, blockchain gaming, real-world asset tokenization (RWA), and DePIN applications.

Image: Openmesh integrating with Chainlink CCIP
(Source: https://www.openmesh.network/litepaper#basics)

Core Technology Architecture: Enabling Everyone to Become a Cloud Provider

At the heart of Openmesh lies its Xnode technology, which powers a trustless, globally distributed cloud infrastructure. This architecture is composed of several key components:

• Distributed Xnodes: Openmesh replaces traditional data centers with a decentralized network of nodes. Anyone can set up an Xnode using their personal computer, server, or even a virtual cloud instance. These nodes provide computing power and storage, which can be listed on the network and rented by other users.
• XnodeOS: Each node runs XnodeOS, a custom operating system built on NixOS, a reproducible Linux distribution. This ensures that each node’s system state is verifiable and reproducible, forming the foundation of network-wide consistency.
• Xnode Studio: A web-based dashboard that allows users to deploy and manage decentralized applications, such as Ethereum nodes, and rent out their idle computing resources to users across the globe.
• DVM (Decentralized Virtual Machine): A decentralized virtual machine delivering performance comparable to a $3,500 traditional cloud instance. Access rights are managed via NFTs, allowing developers to deploy Web3 applications quickly and securely.
• Ethereum Wallet Authentication: Openmesh uses wallet-based login to ensure user sovereignty, secure identity, and permissionless access—there is no need for traditional usernames or passwords.
• Open Source Codebase: All core code is fully open source, enabling the community to audit, contribute, and improve it freely, embodying the true spirit of Web3.

In addition, Openmesh has developed its own decentralized service management protocol—DSMP (Decentralized Service Mesh Protocol). Acting as the “service orchestrator” of the Web3 world, DSMP facilitates coordination, resource exchange, and task execution among Xnodes across the Openmesh network. It integrates multiple technologies to function seamlessly:

• Kademlia DHT: Enables decentralized service discovery, allowing nodes to locate available services without a central registry.
• Libp2p: Establishes encrypted communication and resource sharing between nodes.
• Consensus Mechanisms: Combines three protocols—Proof of Stake (PoS), Proof of Resource (PoR), and Byzantine Fault Tolerance (BFT). PoS ensures task integrity, PoR verifies node resources, and BFT maintains network stability and accuracy even when nodes fail or act maliciously.

DSMP also includes an observability and monitoring module—the Open Observability Protocol. This allows the network to monitor key real-time service metrics, such as latency, failure rates, and user activity. If a node fails, the system automatically redistributes its tasks to other nodes, ensuring uninterrupted service.

This architecture empowers anyone—developers, businesses, or everyday users—to become cloud infrastructure providers. By enabling the sharing of computing resources and decentralized app deployment, Openmesh creates a permissionless and inclusive ecosystem. At the heart of it all is DSMP, functioning like the system’s brain. It orchestrates task distribution, node collaboration, and service reliability, ensuring the decentralized cloud operates smoothly without a central server. For Web3, this represents a practical and scalable solution that breaks free from dependency on centralized cloud providers and delivers on the true promise of decentralization.

Tokenomics: The Triple Utility of the OPEN Token

The native token of the Openmesh ecosystem is OPEN, classified as a utility token with three primary functions:

1. Node Incentives & Staking: Staking OPEN allows participants to become network validators, earning staking rewards and transaction fee incentives.
2. Fee Payments: Users pay in OPEN to deploy applications, access APIs, or store data on the network.
3. Governance Participation: Token holders can engage in DAO governance, influencing protocol upgrades, resource allocation, and ecosystem development decisions.

Token Allocation:

• 28% for node operations and network security
• 20% for ecosystem development
• 20% to the team, advisors, and early supporters
• 12% for fundraising and reserves
• 8% for early validator nodes
• 8% for contributors
• 4% for education, outreach, and grants

Image: OPEN Token Distribution Model

(Source: https://www.openmesh.network/litepaper#basics)

Team & Funding: From AWS to Openmesh

Openmesh was founded by Ashton Hettiarachi, who brings cross-disciplinary experience from his time at Fantom, Chainlink, and AWS, spanning both blockchain and traditional cloud sectors. The core team also includes Lindsey Holt (Head of Strategy & Partnerships), community managers Previn Dale and Pradnyashil Gajbhiye, Gabriele Zennaro (Ecosystem Strategy Advisor), and senior systems engineer Andrew Ong, among others.

Since its inception in late 2020, Openmesh has been self-funded by its founding team, investing nearly $9 million into infrastructure development without raising funds from external VCs. It wasn’t until late 2024 that Openmesh launched its first private sale of the OPEN token, priced at $0.073 per token, with an initial circulating market cap of $8.76 million.

Openmesh vs AWS: Comparative SWOT Analysis

Chart: Openmesh vs AWS - SWOT Analysis
(Source: Compiled independently)

While AWS remains the world’s leading and most reliable centralized cloud provider, serving everyone from solo developers to global enterprises, it is increasingly scrutinized for data sovereignty issues, privacy risks, and censorship concerns. In 2022, for instance, AWS reportedly took down sensitive content at the request of authorities, which raised red flags about trust in centralized platforms.

Openmesh directly addresses this concern. Offering decentralized computing and storage removes dependency on any single data center. Data is distributed across global nodes, giving users full control and ownership, making it particularly attractive to DePIN projects, decentralized AI applications, cross-border NGOs, and Web3 startups. For example, a nonprofit news organization focused on press freedom might face takedown risks when hosting sensitive reports on AWS. However, with Openmesh, content can live permanently on the decentralized network, immune to censorship and centralized control.

That said, Openmesh is still in its early stages. It cannot yet match AWS regarding stability, feature breadth (e.g., Amazon SageMaker, Lambda, EC2, RDS), or enterprise-ready tooling. Businesses prioritizing performance, compliance, and technical maturity may still lean toward AWS. However, for those who value data sovereignty, trust minimization, and censorship resistance, Openmesh presents a compelling new alternative for the decentralized era.

SEC’s Growing Scrutiny of Decentralized Infrastructure

While Openmesh presents an ideal vision of data sovereignty and censorship resistance through decentralized cloud infrastructure, it has increasingly come under the radar of global regulators. In 2024, a high-profile lawsuit by the U.S. Securities and Exchange Commission (SEC) against Coinbase drew widespread attention. The SEC alleged that Coinbase’s Base cloud platform provided backend infrastructure for certain unregistered tokens, potentially constituting indirect involvement in illegal securities transactions.

Coinbase argued that its platform merely offers open protocols and computing resources, and should not be subject to traditional financial regulations. However, the case revealed a critical precedent: decentralized infrastructure providers may still be considered part of the financial intermediary chain.

This creates significant regulatory risk for Openmesh. If aspects of its tokenomics—such as node incentives or revenue-sharing—are interpreted as facilitating the distribution or storage of unregistered digital assets, regulators like the SEC could classify Openmesh as a financial infrastructure provider. This would subject the project to various compliance obligations, including KYC/AML requirements, regulatory disclosures, and legal accountability.

The Coinbase case is not isolated. Regulators have investigated or flagged a growing number of Web3 infrastructure projects, highlighting the SEC’s heightened sensitivity to financial risks and legal ambiguities in the decentralized space.

Notable examples include:

• Filecoin (FIL): Although Filecoin has not been directly targeted by the SEC, many U.S. financial institutions remain cautious. Several exchanges have restricted FIL trading, and the SEC has issued warnings about storage-based tokens, suggesting that if users earn rewards by offering storage via nodes, it could be deemed an investment contract.
• Helium Network (HNT): In 2023, questions arose over whether Helium’s token sales and node incentives constituted unregistered securities offerings. While no legal action followed, the scrutiny led Helium to further decouple its infrastructure layer from its token economy to reduce regulatory exposure.
• Akash Network (AKT): As a decentralized cloud computing platform, Akash promotes open protocols and marketplace-style matching. However, U.S. regulators still have inquiries about its token incentive mechanisms, especially in use cases like AI training and on-chain computing, where service provider status is more pronounced.

These examples show that technical decentralization alone is not sufficient to avoid securities classification. If a platform features token incentives, governance over protocol parameters, or economic linkages to token usage, it may still fall within the SEC’s definition of a security-bearing entity. For Openmesh, everything from its data protocols and node incentive models to API access and token-based payment systems could eventually be subject to more stringent compliance requirements.

Therefore, in addition to maintaining its technological innovation and vision of decentralization, Openmesh must also consider establishing a robust compliance framework—including transparent governance, clear token utility definitions, and a separation between protocol and commercial layers—to ensure more sustainable growth in the global market.

Can Openmesh Carve Out Its Own Path in Decentralized Cloud?

As a next-generation decentralized cloud platform, Openmesh puts forward an ambitious vision to disrupt the dominance of centralized cloud giants. However, from an execution standpoint, it still faces several critical challenges and risks.

Technical Risk: Latency and Service Instability Across Global Nodes

Although Openmesh’s globally distributed node architecture enhances censorship resistance and data redundancy, it introduces service inconsistency due to latency variations across regions. Uneven node density means that users in different locations may experience significantly different API response times and slower data synchronization. These issues become especially pronounced in real-time scenarios such as DeFi order book syncing or AI model queries, where latency is mission-critical.

Tokenomic Risk: High APY Incentives Could Become a Source of Sell Pressure

Openmesh relies on staking and token rewards to sustain its network operations and governance. However, if the incentive design becomes detached from actual platform usage and utility, it could create a token economy bubble. A cautionary example is Akash Network in Q2 2023, where a drop in validator income and market confidence led to a validator exodus, with node attrition surpassing 18%. This highlights that even technically sound platforms can face user churn and ecosystem instability if the reward-demand balance isn’t carefully managed.

In addition to the abovementioned risks, Openmesh also faces significant competitive pressure. In addition to other decentralized cloud projects such as ICP (which uses a custom blockchain and Canister model), Quilibrium (combining MPC and PoMW), Akash, and Filecoin, it must contend with traditional cloud giants like AWS and GCP, who continue to hold major advantages in stability, feature depth, and ecosystem maturity.

Despite these challenges, Openmesh’s execution roadmap demonstrates a pragmatic and actionable strategy. Notable milestones include:

• Deploying 50,000 Xnodes globally by the end of 2024, to enhance network redundancy and fault tolerance.
• Implementing AWS S3-compatible interfaces by Q2 2025, reducing onboarding friction for Web2 developers and offering a familiar storage environment.

In summary, the defining feature of Openmesh Network is that it does not build its own blockchain or lock developers into a closed ecosystem. Instead, it functions as a DePIN (Decentralized Physical Infrastructure Network) that aggregates idle resources worldwide, enabling anyone to become a cloud service provider. Built on open nodes, Xnode Studio, the DSMP protocol, and open APIs, Openmesh offers a decentralized cloud platform that merges Web2 usability with Web3 architecture.

Openmesh represents more than just a technical advancement in Web3—it’s a social movement challenging data monopolies and reclaiming data sovereignty. After years of centralized cloud dominance by giants like AWS, Openmesh aims to disrupt the status quo with core values of censorship resistance, open governance, and user empowerment.

However, success will not be determined by technology alone. It depends on the project’s ability to address:

• Technical stability and the scalability of its node architecture
• Long-term regulatory and compliance strategies
• A sustainable tokenomics and the building of user trust
• Real-world demand and application-driven adoption

If it can overcome these challenges, Openmesh has the potential to become the “AWS of the decentralized cloud era,” pioneering a new paradigm for data storage and computing.