🦍 State of the Market..

The total market cap for Crypto x AI tokens is $34B today, down 12% from last week. This reflects a general ongoing altcoin market correction.

Roaring Kitty captured every financial bro’s attention last week. But after his underwhelming livestream, GME stock took a nose dive. It seems the disappointment spilled over into the crypto market too.

One bright spot: AI tokens represent just 1.2% of the total $2.65T cryptocurrency market cap — there’s still a ton of room for growth. Buckle up!

Top 3 AI Tokens by Market Cap:

• NEAR protocol ($6.9B market cap, -12.8% from last week)

• Internet Computer ($4.9B market cap, -12.1% from last week)

• Fetch.ai ($4.1B market cap, -23.9% from last week)

🏆 Caught Our Eyes..

• Io.net announces the Internet of GPUs at its 2024 summit

• Also, io.net CEO resigns just 2 days before the TGE because of “allegations about my past”

• Nillion to launch “Nil Pill” on June 10. Also announces community round on Coinlist.

• Allora partners with zkSync to provide intelligence for their applications

• Arweave hits 6 billion cumulative transactions, 7x as many from 1 year ago

• Wayfinder Foundation allows PRIME token holders to begin staking tokens to earn PROMPT

• BasedAI accelerates mainnet schedule, launches CYAN testnet

• Bittensor community on incentive design debate and problem with weight copying on subnets

• Someone’s wallet with >10k wTAO ($3.7M) got compromised.

• Corcel enables the use of GPT-4o for free in its decentralised app

• MyShell completes NFT mint, floor price rises 4x to 0.38E

• Dain protocol releases a demo showing how an advanced crypto trading bot can be deployed in 60 seconds.

🐰 Project Highlight — AO Computer

Launched in 2018, Arweave is known for its decentralized permanent data storage. Despite the fundamental importance of data storage, it has always struggled to find a compelling use case and adoption.

Data storage isn’t sexy. It’s a commodity.

Now, AO computer represents Arweave’s most ambitious endeavour to date.

AR = storage layer.

AO = compute layer

The big idea is that deterministic virtual machines + permanent data storage = reproducible state. Founder Sam envisioned this concept four years ago, and it has materialized into a decentralized, actor-oriented computing environment for AO.

The AO computer, operating on the Arweave network, supports numerous parallel processes without size constraints. Its goal is to offer a scalable, secure, and customizable platform for trustless, cooperative computing.

The framework includes processes, messaging units, scheduler units, and compute units. Big words, but the simpler way to understand this is they function like modular nodes on a blockchain, that can be individually optimized for performance.

To simplify:

• The AO computer enables multiple parallel processes that reflect the capacity of local computing power. With a robust computer, you can perform complex computations more rapidly.

• A secure messaging layer allows necessary communication between processes on AO

• Processes maintain individual sovereignty, allowing them to independently select their computational tasks, virtual machines, and other parameters.

Differences from Ethereum/Solana

AO’s main distinction from Ethereum and Solana is its ability to scale compute resources. The output increases proportionally as more computational power is added to the network. In contrast, adding more nodes to Ethereum or Solana does not increase output.

AO’s processes have no memory or visibility into the state of other processes.

Sam teases:

Permaweb 1.0

On June 6, Arweave made three significant announcements to enhance distribution:

1. Acquisition of Odysee by Forward Research: Odysee, the largest Web3 social app with 7M+ users, operates on a blockchain, providing more control and freedom to creators compared to YouTube. It rewards creators with LBRY Credits (LBC) and advocates for less censorship.

2. AgentFi by Autonomous Finance

3. AO Ventures: $35M funding for builders in the AO ecosystem.

Odysee can be seen as an open version of YouTube, perhaps more akin to Reddit. It provides a platform where creators have more control and fewer censorship restrictions. Transforming Odysee into the Arweave permaweb will give creators total control over their content. Many of its viewers come from Europe (France, Spain, Germany).

Tokenomics

AO will be “fair-launched”, which means there will be no pre-mine, pre-sales, preferential access etc. Every token will be minted by bridging to AO, holding $AR, or building. The emission schedule has paralleles to Bitcoin: 21M in total with a 4-year halving. Tokenomic details will be released at 11 am EST on June 13.

It’s also worth noting that the parent token, AR, has a total token supply of 66M, of which 65M are circulating today. AR has potential disinflationary properties because AR spent on data storage goes into the endowment fund, which will release AR tokens only when mining is unprofitable.

Our thoughts

• AO’s approach is very different from traditional blockchains. It could be a hit or miss, but the ability to perform large computations on-chain is a major unlock in the age of AI

• AO uses an actor-oriented approach to support high concurrency, modularity, and scalability. Its challenges include testing, debugging, and maintaining consistency across distributed actors.

• It is early days. AO is still in the testnet. It is mostly text-based games and chats, along with some DeFi primitives like AMMs (Bark). I’m waiting for a powerful application built on AO as a proof of concept.

• AO will create consistent demand for AR and serve as both a growth catalyst for Arweave and a new platform for app development.

🧠 Web2 AI Corner

• Current and former employees from OpenAI, Google, and Anthropic have published an open letter warning about the dangers of advanced AI and urging for increased industry oversight.

• Leopold Aschenbrenner, a former OpenAI researcher, released essays discussing the rapid and unpredictable development of AGI.

• Chinese tech firm Kuaishou unveiled KLING, a new AI model for video creation that rivals OpenAI’s Sora, capable of producing high-quality, physically accurate 3D videos

🔥 On X..

Comparison of GPU rental pricing

99.9999% chance of AGI destroying human civilization

Computing requirements for AI models 4x every year

People truly worried about being irrelevant with AI

Wayfinder: Key things to know

A Great Wayfinder Analysis (Notion)