GM {{first_name}} !

It was impossible to scroll Twitter this week without bumping into at least one Ghibli-fied image. Thanks to GPT-4o’s latest image update, the internet collectively dipped into AI-fueled nostalgia—every feed now looked like a Miyazaki film on acid.

But behind the cute overload? Bigger questions.

Ghibli’s iconic style powered the trend—yet the studio likely got nothing. That’s the AI remix era in one sentence: artists build the culture, AI scrapes it, and no one asks for permission.

Welcome to the copyright gray zone of GenAI.

Projects like Story Protocol are trying to hardcode consent into creativity—where aesthetics become licensable, trackable, and monetizable. Programmable royalties for visual style. Still early, but it’s a serious play at reclaiming ownership in the age of infinite clones.

Meanwhile, the privacy red flags are flapping. Millions of people fed their personal photos into AI models to generate their Ghibli alter egos. No one asked where the data was going—or who could use it. That’s why we believe privacy-focused infra like Nillion is essential.

Because cute doesn’t mean safe. ✌️

If we zoom out: this actually wasn’t just about Ghibli nostalgia. This was a sneak peek at the future of the AI internet.

Creators today are stuck choosing between being invisible or exploited. Users get magical tools—but the cost is their data and autonomy.

We need better rails. For privacy. For ownership. For control.

A few other thoughts for this week:

  • Rule #1 in crypto: if it can be exploited, it will be.

Case in point: Hyperliquid. Someone went max size on perps for a tiny cap token. Protocol had no guardrails in place. The vault ate the loss.

Which brings me to my bigger fear: LLMs with wallets managing significant $$. Models are easy to trick, and the attack surface is massive. Yikes. Security infra needs to level up—fast.

  • What if you could co-own an AI model?

Not just use it. Not just fine-tune it. Actually own a piece—on-chain, with others.

In web2 AI, the value pools at the top. OpenAI’s worth comes from controlling GPT-4o. But in decentralized AI, models become tokenized assets. And that unlocks a new kind of investing: owning the AI.

Some say we don’t need to bother with decentralised training or tokenising models—great open-source models like DeepSeek already exist.

Open weights ≠ free production.

Those models exist despite terrible incentives.

If labs stop releasing new checkpoints (whether for “safety,” profit, or politics), we’ll we’ll suddenly find ourselves with no new open models and no infrastructure to build our own.

Tokenized models = resilience, sustainability & long-term independence.

Let’s build it right.

🚨 But wait—

  1. Are you in our telegram channel yet? Cyra, our AI researcher, drops daily AI alpha that you don’t want to miss.  See it for yourself. 

  2. Catch our podcast summaries too, complete with detailed show notes. Saves us hours

  3. And if you want to jam with us directly, hop into our Discord

Based on rootData’s Hot Index, here’s what catching people attention:

🔥 Wayfinder is on a tear, clocking a Hot Index of 565 after hitting an all-time high in daily active messages. That kind of spike doesn’t happen by accident. Feels like something’s clicking with users, and the market’s paying attention.

🧠 Arcium follows with a Hot Index of 354—and it’s making moves. This week alone, it closed a round of angel funding, got the nod from Nvidia via its Inception Program, and dropped its tokenomics.

Crypto AI is heating up—but the crowd’s still split on where it’s heading.

According to a recent CoinGecko survey, 47% of participants say they’re bullish on Crypto AI in 2025. That breaks down to 27% going full send, and 20% cautiously optimistic.

Meanwhile, 24% are straight-up bearish, and 30% are sitting in neutral—waiting to see if the space grows up or flames out.

coingecko.com

Even among the “Innovators”—early adopters who usually ape in first—only 47% are bullish. Nearly 29% are bearish. Translation? Being early doesn’t guarantee long-term conviction.

TL;DR: People are paying attention. But belief is fragmented. Crypto AI still needs to prove it’s more than just a narrative play.

Lit Protocol Usage Explodes

Lit Protocol is lighting up: Q4 2024 saw 587K Lit Actions (107% QoQ growth), and total value managed hit $122K (up 461%).

Agents are getting wallets. Lit’s making sure they don’t get rugged.

Lit Protocol is a decentralized key management and compute network designed to enhance security, privacy, and user control for Web3 applications and AI agents.

At its core, Lit splits encryption keys across decentralized nodes. Those fragments only come together if programmable conditions are met (e.g. "only sign if this agent holds a certain NFT or stays under a $1K limit"). These rules run via Lit Actions, tamper-proof scripts that trigger secure logic off-chain.

Since late 2024, Lit’s been leaning hard into AI. In January 2025, they launched the Lit Agent Wallet—a wallet designed specifically for autonomous agents. It keeps keys secure, lets users set guardrails (spending caps, chain access), and supports cross-chain ops (Ethereum, Solana, etc.).

One early example: Agent Hustle, a voice-controlled crypto assistant built on EmblemAI + Lit Protocol. It trades, earns, and manages assets autonomously—no dev-held keys, no human approvals.

🌴 Frodobots and SAM

Robots.fun is what happens when a robotics team goes full degen.

Built by FrodoBots—a real-world robotics team with a global fleet and thousands of hours of driving data—Robots.fun is their crypto-native playground. Think Pump.fun, but instead of memecoins for cartoon waifus, you’re launching actual robots.

Set to launch in late March 2025 and powered by Virtuals, the platform lets anyone mint an embodied AI agent: physical robot + AI brain + token + human co-pilot. Around $200 gets you a bot ready for real-world treasure hunts and meme-fueled arena battles.

The star of the show? SAM—part humanoid, part AI agent, part memecoin mascot. But Sam isn’t just a face for the brand. The @SamIsMoving account taps directly into FrodoBots' global rover fleet, playing a real-time geolocation guessing game as it roams the world.

It’s a playful glimpse into the future of embodied AI powered by decentralized infrastructure. Using frameworks like Quicksilver, SAM-style agents could soon tap into real-time sensor and location data from DePIN networks. All value accrual from Frodobots flows back to the SAM token, which has already hit a $40M market cap.

Behind the scenes, FrodoBots raised $8M to launch BitRobot, a Solana-based subnet on Bittensor powering crypto-incentivized AI research. Each subnet node contributes real-world resources: compute, datasets, or physical robots—from sidewalk bots to humanoids.

They also dropped: UFBots, aka Ultimate Fighting Bots. For $5 per 10-minute session, you can remote-control a fighting humanoid in robot PvP battles. It’s esports meets DePIN.

BitRobot is aiming to become the Web3 layer for embodied AI.

Project Updates

  • Nillion’s Alpha Mainnet is live and $NIL is officially launched—ushering in a new era of blind compute where data stays private even while in use.

  • Nillion has also open-sourced its full suite of Blind Modules—nilDB, nilAI, and nilVM—making advanced privacy infrastructure accessible to all developers. These modules power secure storage, private AI inference, and encrypted multi-party computation.

  • Capx AI raises $3.14M to launch an Ethereum L2 for building, owning and trading of AI agents.

  • Vana and Flower are building COLLECTIVE-1, a 7B user-owned foundational model using private data from 1M+ Vana users.

  • Story Protocol’s IP portal is now in open beta

  • Peaq introduced tokenized humanoid robots running decentralized applications, enabling autonomous navigation and service delivery.

  • Fetch.ai’s ASI-1 Mini now supports Multi-Knowledge Graph Integration, allowing users to combine multiple knowledge bases in a single AI session. It delivers deeper reasoning and contextual understanding.

  • Recall has introduced the Recall Foundation, a Cayman-based non-profit. The Foundation will oversee open AI agent competitions and ensure Recall operates as a credibly neutral, community-driven public good.

  • GAIB has launched its AI Synthetic Dollar (AID) on Arbitrum, bringing GPU-backed yield and real-world asset exposure to the Layer 2 chain. This integration bridges AI compute and DeFi, enabling users to stake AID for GPU-derived returns.

  • Warden Protocol has launched SPEX (Statistical Proof of Execution), a new way to verify that off-chain computations—like AI tasks—were done honestly. It uses smart sampling and cryptographic proofs instead of re-running everything, and it’s now open-source as warden-spex.

  • Alchemist AI just added a geolocation API, letting apps respond to users’ real-world locations. Devs can now build features like local deals, region-aware games, or live-updating travel guides.

  • Chutes Platform v2.0.0 is now live, featuring a full app rebuild with faster performance, improved filtering, and easier chute creation. New updates include network and miner stats, support for speech models, and a live API dashboard.

AI Agents

  • Mintify unveiled MintAI—an AI-powered trading assistant that lets users buy, sell, and discover assets using simple text prompts. It offers personalized alpha feeds, on-chain queries, and cross-chain support.

  • Virtuals Protocol just launched the Virtuals Partners Network (VPN)—a curated ecosystem of investors, builders, and researchers designed to supercharge AI Agent founders. It’s not just a support group—it’s a network effect engine aimed at bootstrapping the world’s first Agentic Network State.

  • Sentient has launched the Sentient Builder Program, putting $1,000,000 in funding on the table to support developers building high-utility AI agents. Open to individuals and startups, participants get ownership, compute credits, mentorship, and distribution via Sentient Chat.

  • Masa has launched X-Twitter Scraper—a free tool to search X (Twitter) for trends, hashtags, cashtags, and keywords in real time. It returns 10–25 tweets per query, formatted for LLMs, and is set to integrate with MCP for seamless AI agent workflows.

  • Spectral Labs launches a campaign offering over $50K in bounties for building AI agents and workflows.

Web2 AI

  • Google just dropped Gemini Robotics—an AI system that lets robots see, think, and act in real time. From folding origami to handling unseen tasks across different robot bodies, it’s a major leap toward general-purpose embodied AI.

  • Grok AI just landed on Telegram. Fresh off 1 billion MAUs, Telegram is integrating Grok for all Premium users—marking Elon’s first major expansion beyond X in his AI everywhere play.

  • DeepSeek-V3-0324 just dropped—with sharper reasoning, better front-end dev chops, smarter tool use, and it's already the highest-performing non-reasoning model.

  • Gemini 2.5 enters the room—and it's Google’s sharpest model yet. With major leaps in reasoning and coding, it's now ranked #1 on lmarena.

  • Intelligent Internet has introduced II-Thought, a curated reasoning dataset for reinforcement learning with 340K+ high-quality problems across domains. It enhances model reasoning efficiency, improves performance, and is now available with remote reward model support for easy VeRL integration.

  • Microsoft has canceled data center projects totaling 2 gigawatts in the U.S. and Europe over the past six months due to lower-than-expected AI demand—mainly from reduced support for OpenAI training.

We’ve officially acquired @outpostdotai — one of the OG voices in Crypto AI. Huge welcome to all the new readers rolling in from their crew!

Our mission stays the same: drop the sharpest, most dialed-in research in the space. And yep, we’ve got some spicy things coming your way soon. Stay tuned 👀

🔥 Our Weekly Top 5

It’s official: AI makes better memes than you. Pack it up, humans. We had a good run.

Over 9 million $TAO (worth $2B+) has been traded on Bittensor in 14 days.

A trader makes >$1 million on Fartcoin in a few days

Perplexity has crossed $100m in annualized revenue

David Sacks tells us who will win the AI race

That’s a wrap for this week! Got thoughts, feedback, or something cool to share? Just hit reply—we read it all.

Cheers,

Teng Yan & Issy

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