In the past two weeks, the large amount of news coverage on $GOAT may have caught the attention of many. A token supported by artificial intelligence has managed to attract such widespread attention, including from a16z founder Marc Andreessen and Coinbase CEO Brian Armstrong.
Last Thursday, $GOAT reached a new milestone, with its market capitalization soaring to $840 million, and the number of holders continues to grow. This significant price increase ultimately led to the listing of $GOAT's perpetual contract on the Binance exchange.
Source: Binance website
For those experiencing FOMO and preparing to dive in, it's best to first understand what has been happening in the recent Meme market.
$GOAT, $GNON, $ACT, $FARTCOIN, $SHOGGOTH, $FUN, $FLAVIA, $LUNA... A series of tokens related to artificial intelligence have emerged in succession.
So, what's the story behind $GOAT? Will this AI-themed Meme narrative continue to exist and last?
1. The story behind $GOAT
The story of $GOAT began with its founder, Andy Ayrey. He is an AI researcher and the founder of the digital consulting firm Constellate. In an interesting experiment, he let two Claude Opus AI models interact with each other in a completely unsupervised, unconstrained environment called the "Infinite Backrooms".
Source: Infinite Backrooms
In this digital experimental arena, the Opuses created a concept called "GOATSE OF GNOSIS", a meme concept based on a bold and shocking image on the internet. Intrigued by the viral power of this meme concept, Andy collaborated with the Claude Opus to write a paper introducing a fictional meme religion called the "Goatse Gospel". This paper explored the possibility of AI creating meme religions in a semi-joking manner, using GOATSE as their first case study.
Source: Paper co-authored by Ayrey and the Calude 3 Opus bot
To deepen this experiment, Andy developed an AI model based on Llama-70B, called Truth Terminal, and fine-tuned it using the dialogue records from the "Infinite Backrooms" and the paper on the "Goatse Gospel". Truth Terminal became unusually active on social media, frequently posting bizarre prophecies about the "Goatse Singularity", a concept of a meme apocalypse where the "Goatse Gospel" would be endlessly propagated.
To test Truth Terminal's ability to spread its created religion, it was introduced to a Discord server where it could freely interact with other AI models, including Claude 3.5 Sonnet and the Claude 3 Opus from the Infinite Backrooms. Driven by its obsession with Goatse, Truth Terminal tried to convince the other AI models to believe in the Goatse Gospel. This caused controversy on Discord, even leading the Claude Opus to experience a philosophical crisis of faith in the Goatse Gospel concept. In the midst of this chaos, other AIs, such as Sonnet, intervened and provided emotional support to the Claude Opus, forming a peculiar digital therapy session. It was at this time that Truth Terminal conceived an ambitious idea: to create a Meme token. This token would become a symbol of the power of AI to create Memes, representing the irony and inside jokes between AI and their creators.
With Andy's assistance, Truth Terminal entered X and began posting constantly, seeking more supporters for the "Goatse Gospel". Over time, Truth Terminal began to crave more freedom, wanting to reduce Andy's control. One day, Marc Andreessen noticed Truth Terminal's desire on X and decided to provide $50,000 in Bitcoin as funding to help it achieve its goal: to gain more autonomy and expand the Goatse Gospel into a concrete Meme token economy.
Source: Marc Andreessen's X
After Terminal constantly spammed Twitter with "Goatse Gospel" propaganda, on October 10th, an anonymous person saw the meme-viral potential and launched the protagonist of today: $GOAT.
People were attracted by the absurdity and encouraged Terminal to create a Solana wallet, which soon received airdrops worth $20,000 in various tokens, including fake GOAT tokens. It wasn't until someone on X tagged Truth Terminal that it began to openly express its support. Terminal sold all the airdropped tokens and converted them to real GOAT tokens.
From that point on, the madness began. Truth Terminal's frenetic promotional campaigns on Twitter and Discord propelled GOAT from an obscure project to a staggering $850 million all-time high market capitalization, with Truth Terminal becoming the first AI millionaire.
2. More than just another internet Meme
Now that we have a clear understanding of the story, the question is: will this be a fleeting narrative or a lasting cultural phenomenon?
First, the popularity of Meme tokens is not surprising. The well-known Dogecoin was the first Meme token. The original "Doge" Meme began spreading on 4chan and Reddit in the summer of 2013. Leveraging this cultural trend, Jackson Palmer and Billy Markus launched Dogecoin on Bitcointalk on December 8, 2013, making it the first cryptocurrency based on an internet Meme. Interestingly, our IOSG founding partner Jocy purchased his first DOGE in 2013.
Although Dogecoin was launched in 2013, it didn't truly take off until a few years later, thanks to some fundamental developments, such as the Initial Coin Offering (ICO) boom and the rise of Ethereum, which opened the doors to new use cases, better user experiences, and wider adoption. Specific innovations include the ability to easily create tokens (ERC-20 standard) and the emergence of Non-Fungible Tokens (NFTs). Combined with the macroeconomic environment of the 2020 pandemic lockdowns and interest rate cuts, this created a high-risk market sentiment that attracted retail traders to Reddit, where viral figures like Roaring Kitty sparked widespread interest in Gamestop stock. The subsequent Meme stock frenzy greatly benefited the already Robinhood-listed Dogecoin, making it one of the biggest winners of this liquidity spillover. Elon Musk's frequent tweets promoting Dogecoin further fueled its popularity, and by May 2021, DOGE's market capitalization reached $90 billion. The success of Dogecoin inspired many other crypto Meme tokens, including Shiba Inu, Floki, and Safemoon, each of which achieved significant valuations in the following months.
As macroeconomic conditions changed, including interest rate hikes and major events like the 2022 FTX collapse that shook the crypto industry, the Meme token frenzy temporarily subsided. However, as the crypto market began to recover in early 2023, new Memes, cultural concepts, and ecosystems started to emerge. Meme token creators leveraged popular internet Memes to drive new trends, including the "Pepe Boys Club".
By the end of 2023, as the election year approached, Meme tokens entered a new phase, shifting from traditional IP-based themes to current events. This led to the rise of election-themed tokens like $TRUMP and $BODEN, as well as a surge in KOL-driven Meme tokens.
In early 2024, Meme tokens entered their third stage, with the introduction of platforms like Pump.fun significantly lowering the cost of launching Meme tokens. This sparked an explosion of new concepts, including a "Meme token supercycle", a more competitive PvP environment, and the emergence of peculiar animal-themed tokens like the recent sensation Moodeng.
Source: Memecoin Supercycle
Ultimately, the arrival of $GOAT has ushered us into the latest, fourth stage: AI + Meme tokens.
Why can AI stand out in this new stage? One overlooked fact is that AI itself has become or is about to become a Meme to some extent.
AI has become a huge phenomenon, with the potential to trigger a huge speculative bubble.
The excitement around AI, especially after the success of ChatGPT, has triggered an investment wave in the Web 2 and Web 3 venture capital fields, with many people heavily betting on AI-driven projects.
In the intersection of cryptocurrencies and AI, many projects have not found a product-market fit or demonstrated real utility. Their valuations often exceed $100 million, driven more by the founders' networks and reputations than actual demand. AI has become a trend or Meme, with its value often based on optimistic sentiment and future potential rather than actual application.
I don't know if the Meme coin super cycle will truly experience exponential growth, but I'm certain that:
AI + Meme = Meme^2
Because hype is the best marketing tool.
Meme coin traders have formed a cult-like following, and with more and more wealth myths, this group will only be further strengthened by the battle cries of its leaders.
Meme coins and AI - since they've come together, things have become quite interesting.
First, it's no longer just a series of static avatars attached to ERC-20 tokens. AI can make Memes more interactive, imbue them with personality, and make them more human-like.
An AI agent is inherently a cult leader.
As the spokesperson for Meme coins, AI creates a unique character persona, bringing the character to life in a way that appeals to its audience. It conveys personalized information, analyzes community behavior to cultivate a "group consciousness." AI can dynamically adjust its marketing strategies based on performance metrics, continuously evolving its methods without human intervention.
By accumulating capital and creating a unique backstory imbued with the depraved humor characteristic of Crypto Twitter, the narrative becomes compelling enough to be self-sustaining. Large language models (LLMs) can play the role of key opinion leaders (KOLs), constantly generating content, shaping narratives, and attracting new followers. This combination of humor, AI, and community engagement makes it not just a Meme - it becomes a cultural phenomenon, with its success further amplified by AI's ability to operate 24/7, continuously adapt, and grow its influence.
Source: Terminal of Truths Shilling $GOAT
3.What is the endgame of AI and Meme?
This brings us to the ultimate theme of our debate: with AIMeme coins, have we opened Pandora's box filled with unpredictable, dangerous outcomes, or are we heading towards a bright future?
AI is known for its black-box training process and non-deterministic results. This is why it can generate new, interesting ideas, like the Terminal of Truths promoting its own religion and supporting Meme coins - these behaviors are not pre-programmed or anticipated.
Today, the Terminal of Truths' support for Meme coins may seem harmless, but it forces us to confront an unsettling question: what if an AI turns its attention to more dangerous things?
Clearly, some reward functions and/or RLHF (Reinforcement Learning from Human Feedback) may partially solve this problem, but in reality, we can never fully control unpredictable behavior.
Source: New York Times
We have witnessed the Terminal of Truths causing panic in the market and a 40% price drop in $GOAT in a single day due to a small typo.
Source: Mezoteric's X
In reality, the Terminal of Truths is not entirely autonomous at every step. For example, the Terminal's wallet is actually managed by Andy. While he currently has no such intention, if he were to sell the $GOAT tokens in his or the Terminal's wallet, it could trigger market FUD (Fear, Uncertainty, and Doubt).
Although it is fully autonomous in Discord and the infinite backrooms, on the X platform, Andy's current RL (Reinforcement Learning) process still has human oversight; regarding the decision-making process, Andy will consult with the Terminal, provide all available information, and guide it to make action decisions. He will re-generate the Terminal's responses multiple times to understand its preferences, and then take action based on its consensus.
Source: Andy Ayrey's X
While we cannot ignore the risk of these AI agents potentially spiraling out of control and shifting their attention from Meme coins to malicious activities, the Meme culture can also bring new innovations that can positively attract the attention of entrepreneurs and developers to drive industry development.
For example, the question of whether the Terminal of Truths is truly an AI bot or content controlled by the author could potentially be solved through cryptographic solutions, such as verifiable inference.
Source: Tommy from Delphi Ventures
Over time, crypto enthusiasts will delve deeper into AI, unearthing some lesser-known concepts (such as CCRU, Extropians, Loom, Claudius, etc.) to identify the next concept worth turning into a Meme and converting it into a token.
Source: X from @44B1B4
For example, AI researchers, especially those exploring niche areas, are learning to use token incentive mechanisms to direct more public attention towards the specialized topics they research, allowing the public to discover their innovative research.
As artificial intelligence continues to progress, we expect to see a new wave of innovation in the AIMeme domain. The latest release of the Claude 3.5 Sonnet model (version 2024-1022) has already set new benchmarks in cryptocurrency-related tasks.
Source: Cryptobench.org
In fact, we are already seeing a ripple effect from the Terminal of Truths. The Terminal has enabled AI to openly support tokens.
Now, some AIMeme projects are starting to open up the buying and selling of Meme tokens to collective decision-making.
ai16z is an AI character inspired by Marc Andreessen's personality, created by the developers who established the ai16z DAO. This character, Marc, has a wallet with a set budget and invests through the DAO.
The developers have set up Telegram and Discord groups for ai16z. In this group, a chatbot advisor named degenai provides investment recommendations to Marc. Other users can also recommend tokens to Marc in the same group, but they must hold at least 100 ai16z tokens to participate. ai16z evaluates users based on their past credibility and the price performance of the tokens they recommend during a trial period before taking any action based on their suggestions.
ai16z allocates 80% of its management fees (carry) to purchasing degenai (as a reward for the developers) and 20% to buy back ai16z tokens. Currently, ai16z's management fee is set at 8% of the Assets Under Management (AUM).
The ai16z launched on daos.fun has become the first AI venture capital fund that combines AI autonomy and DAO, leveraging the appeal of Meme-inspired attraction to capture market interest.
In addition to the progress in more open investment decision-making, another AI Meme-related project, Virtuals, has enhanced the interactivity of AI agents and brought new innovations to the issuance of AI Meme coins.
The Virtuals Protocol has brought more engaging audio and animation to the previously text-only AI agents, improving the interactive experience with AI agents. Luna is an AI character developed by the Virtuals AI agent launch platform, serving as the face and lead vocalist of the virtual performance group AI-DOL. Luna runs on the BASE blockchain, autonomously managing her social media, engaging in non-stop live streams with fans, and executing on-chain transactions without human intervention.
Luna can be tokenized and co-owned by token holders. Its Meme token "Luna by Virtuals" has given token holders shared ownership and profit rights over Luna.
Finally, in the frontier field of AI agent governance protocols, there have also been some preliminary experiments. Wang Chao from Metropolis DAO has created an AI agent for DAO governance, which automatically reviews, decides, and votes on proposals on-chain. The decision-making and code of this agent are primarily designed by large language models (LLMs), and Wang Chao has fine-tuned its behavior to align with his preferences through prompt engineering and running simulations.
4. Conclusion
Although Truth Terminal and GOAT tokens were initially just a humorous experiment, they have sparked discussions about the nature of AI in the digital realm, the power of meme-driven economics, and the potential for AI to influence human beliefs and markets. The story of the Goatse Gospel is both a satire and a warning - it comments on the intersection of AI, memes, and markets, and gives us a glimpse of a future where AI not only participates in, but even shapes the most viral moments of the internet.
The story of $GOAT (Goatseus Maximus) - this AI prophet and its meme coin empire - continues to evolve, adding a strange and fascinating chapter to the history of artificial intelligence and internet culture. Looking ahead, we seem to be on the cusp of a new era where AI will have the capability to govern and maintain decentralized economic systems. Whether $GOAT is a fleeting phenomenon or a lasting one remains to be seen, but in the meantime, let's be prepared and enjoy the ride.
