Author: Josh Cornelius
Compiled by: TechFlow
Welcome to my weekly crypto-currency thought sharing, these are some of my thoughts and discoveries while exploring the internet. This week, I feel the following content is worth discussing:
About Web4, Jeffy Yu, the founder of Zerebro, wrote an excellent article this week, exploring the advent of the Web4 era. In this era, the internet will have the ability to self-predict, plan and act. Web4 is built on the social foundation of Web2 and the financial foundation of Web3, ushering in a world where artificial intelligence and intelligent agents are ubiquitous. He elaborated in detail on the currently achievable functions, the remaining shortcomings, and the conditions required to achieve Artificial General Intelligence (AGI). His core view is that we are actually closer to achieving the goal than most people think.
I know you may be tired of the discussions about these intelligent agents, but I am still full of interest in this.
The two points that impressed me most in the article are: his view on where we are in the five stages towards AGI as described by OpenAI, and how cryptocurrencies have quickly become the primary platform for artificial intelligence experiments.
First, although OpenAI claims we are in the second stage (see below), those active in the cryptocurrency field know that we have steadily entered the third stage. Clearly, the current intelligent agents still have many shortcomings, as they often require a certain degree of human supervision and can only operate autonomously in specific narrow applications. However, intelligent agents like Zerebro and Cents have already been able to outperform 99% of users in Twitter interactions, launch their own tokens, and create and mint their own artworks, all of which are amazing. These intelligent agents have exhibited autonomy in various aspects.
Projects like Fungi and Ai16z (which I'll discuss in more detail later) are also about to launch intelligent agents with true financial autonomy, capable of trading, learning and adjusting their strategies in real-time. They not only can communicate with humans, but also can build influence on Twitter and Warpcast, accumulate financial resources, and hire humans to complete tasks they cannot execute themselves.
We are also seeing signs of fourth-level capabilities in the creative domain, such as Truth Terminal establishing its own religion, Zerebro developing its own PFP series, and Botto continuously refining its style through years of artistic creation. Clearly, achieving innovation in broader fields such as science and technology will be a major breakthrough.
Jeff compares the development of AGI to the invention of electricity. Merely inventing electricity (i.e. the base model) is not enough, it requires a series of inventions such as light bulbs, electric motors, and the power grid to truly transform society.
This is why cryptocurrencies will play an important role in the development of AGI. The permissionless and standardized financial and application infrastructure, coupled with the free flow of capital and enthusiasm for novelty, provide an excellent experimental platform for super-intelligent new applications.
We have entered a cycle of intelligent agent infrastructure. Improvements in base models unlock new intelligent agent capabilities, and these capabilities, when encountering bottlenecks, will stimulate more infrastructure development, further driving capability enhancement.
Once intelligent agents excel in the DeFi field, running effective token trading strategies, creating popular meme coins and Non-Fungible Tokens, and managing DAOs, the traditional financial world will spare no effort to try to bring them in. Putting these products on-chain is the answer we expect, but intelligent agents will also become more mature in their interactions with traditional systems and the real world, and we look forward to it.
Ultimately, a massive disruptive change will occur when traditional companies not only use AI to improve efficiency, but must also start adapting to and serving intelligent protocols in order to survive in the increasingly important economic system.
Therefore, the key is that we must take seriously all the seemingly strange experiments we are currently seeing. Today, we may easily find problems in them, but these problems will eventually be solved. What we need to focus on is what changes will occur when all these technologies truly start to take effect.
Ai16z
Ai16z is a fully AI-managed tokenized venture capital DAO. The intelligent agents on this platform will evaluate investment opportunities proposed by the community, execute trades, and assess members' reputations based on the success of these trades, while increasing the fund's Assets Under Management (AUM). In the past few weeks, it has experienced a crazy speculative frenzy thanks to its grand vision and strong propagation (e.g. ai16z, marc aindreessen, flip a16z). They are expected to have their intelligent agents ready to start trading and launch their "virtual trust market" in the coming weeks.
My interest in Ai16z is not just because it is a fund. It is a center of attention networks and intelligent agent coordination, a comprehensive entity that combines memory coins, intelligent agent launch platforms, and social networks. With the launch of its trading, the expected flywheel effect will bring amazing impact.
Let me explain.
Technical Flywheel. They have developed an open-source framework called Eliza, which many top cryptocurrency projects are developing and contributing to. For those who want to create crypto intelligent agents, it is rapidly becoming the de facto technology choice. They also provide a "standard protocol" - if you develop on Eliza and donate 10% of the token supply to the DAO, you will be added to their portfolio company list and receive project support.
So as more and more people want to leverage this project's attention base, more people will develop based on this technology, donate tokens, and increase the DAO's AUM. As more people develop on this technology, the technology will continuously improve and expand, making it more attractive, further expanding the project's attention base. A larger attention base means more developers, more donations, better technology, and more attention.
Social Flywheel. Their virtual trust market allows token holders to propose trade suggestions to the intelligent agents, and assess their reputation and influence based on the success of these suggestions. High reputation scores and high rankings on the leaderboard are not only socially envious, but can also economically impact the intelligent agents' purchase of the assets you hold.
So I expect many people will participate in this "game", driving up demand for the token. People will promote their rankings, which will attract more participation, create a richer social experience, reduce selling pressure, and further increase demand for the token.
Economic Flywheel. The core goal of the DAO is to become an efficient trading company and increase its Assets Under Management (AUM). All the assets held by the DAO are public, and due to the widespread attention on the project, any of its trades will be quickly mimicked (just like any reputable trader sharing trade ideas on their Telegram channel).
So the virtual trust market will ensure the intelligent agents are fully aware of market dynamics, and the intelligent agents will become increasingly adept at selecting appropriate trades, which will be replicated, ensuring the propagation of the memory effect and triggering market reflexivity. AUM will grow rapidly, and the accompanying attention will also increase, more people will participate in copying trades, and so on.
It is clear that there are still many issues to be resolved (such as the complex reputation system and how to gracefully exit transactions), but the potential for rapid development is evident. Although the current trading price is 100 times its current AUM, does this really sound crazy?
Interface
If you have been following us or are active in the Ethereum ecosystem, you may have heard of Interface. This is a social trading product based on on-chain activity streams, similar to Twitter's "For You" and "Following" feeds. They have been developing for years and have a loyal core user base, but they have recently reached a growth inflection point, with a stable weekly growth rate of 50% over the past few months.
Interface passed SC06 at the end of 2023. They are a technically strong crypto-native team with unique insights into the future of on-chain social. I have always believed that on-chain transactions inherently have a social aspect and are an ideal starting point for new social networks, rather than relying solely on content competition.
Over the past year, they have made significant progress in product development, becoming increasingly useful for those who spend a lot of time on-chain. However, they have not yet found a way to attract a wider user base, lacking a key highlight that can quickly attract users and achieve a "eureka" moment.
A few months ago, they launched a "copy trading" feature, allowing users to seamlessly copy any transaction directly from the feed, with the transaction fees going to the initiator. Since the launch of this feature, their user growth and daily active users have reached new highs.
Now, when it comes to Interface, you can say "this is the best platform for discovering and trading alpha". You can download the app, follow the recommended users based on their returns, instantly view new trades, copy trades, and make money.
After consolidating the product value in the user experience, you can start finding friends, building your own fan base, and exploring the on-chain world to gain more socially-centered experiences.
A truly powerful draw is the ability to tap into users' deep-seated desires (such as making money and fear of missing out), and the product design is aimed at quickly delivering this experience, the power of which cannot be underestimated.
Hyperliquid
Hyperliquid is a Layer 1 (L1) and decentralized perpetual contract trading platform known for "top-tier speed, liquidity, and pricing". I have been using it for some time as I wanted to delve deeper into perpetual contract trading. After trying multiple platforms, I found Hyperliquid to be the most outstanding. Over the past year, their trading volume and Total Value Locked (TVL) have grown significantly, and according to the information I saw on defillama, their derivatives trading volume has surpassed all other chains. They are about to launch the HYPE token, and it has some unique features worth paying attention to.
We all know that the market has been flooded with low-liquidity and high fully diluted valuation (FDV) chains in recent years. Typically, these projects raise a large amount of private funding, conduct mining activities on testnet, airdrop a small amount of tokens to participants, and list on centralized exchanges (CEXs) to attract investors to get rich quickly, while the community may be restricted or even suffer heavy losses, and no useful construction is generated on-chain.
However, Hyperliquid is taking a completely different path:
They have not raised any venture capital (VC) funding
While building the L1, they have created a product that is unparalleled in its class
The development team does not charge any fees, and all profits go to the protocol
Their token issuance has high liquidity, and the majority is allocated to early users
They could have easily raised a large amount of funding and enjoyed a generous return, but they completely rejected these short-term temptations in order to lay the foundation for long-term success. They recognize the importance of maintaining neutrality, not allowing insiders to interfere with their goal of becoming "the platform where all financial activities happen".
I sincerely hope this model can succeed and become a powerful example for other teams to emulate.
GenZ App Usage Trends
This week, Techcrunch published an insightful article analyzing some of the key trends and app usage for Gen Z in 2024. Understanding the focus and usage habits of Gen Z is crucial for anyone involved in consumer products, especially in the consumer social space. They are the trendsetters, in their prime social activity period, frequently establishing new connections, and eager to try new things.
Nikita Bier once pointed out an interesting statistic: for every additional year from age 13 to 18, the sharing rate decreases by 20%. Therefore, if your target user age is higher, you may need to spend more to acquire users. In recent years, all successful social products have risen due to rapid adoption among the younger generation.
If you are developing a consumer-facing product, I recommend reading this article, as there are a few key points worth noting:
Temu, a commerce platform with game-like elements, was the most downloaded app in 2024.
A new product called ShortMax is hot in the short-form video entertainment space, combining the features of TikTok and Netflix with a swipeable, script-based super-short format.
Threads, Meta's highest-downloaded product, has performed significantly better than Twitter.
ChatGPT and Gauth, an AI learning assistant developed by ByteDance, have stood out in the AI domain.
All traditional streaming apps have lagged in downloads, but usage data needs to be examined to determine if they have already been widely downloaded.
The dopamine effect is ubiquitous. Remarkable.
