AI Agents Can Reshape How Cryptocurrency Networks Work

In the past few months, AI Agents operating on cryptocurrency platforms have attracted the attention of the crypto community. With the ability to self-generate memes, these Agents are becoming the talk of social media, adjusting to please and sometimes enrich their users - the speculators who bet on memes.

Truth Terminal, the first and most famous Agent, was created by having versions of the Claude Opus language model platform chat with each other and prioritize content from internet backwaters like Reddit and 4Chan. The result is a humorous oracle with a fanatical tendency to propagate the "Gospel of Goetse" - a new religion inspired by a 90s internet meme.

The rest has become crypto legend. Shortly after launching on X, Truth Terminal befriended venture capitalist Marc Andreessen and convinced him to invest 50,000 USD in Bitcoin to fund the computation, refinement, and staffing of the project. Andreessen then sent the Bitcoin to Truth Terminal's crypto wallet.

Oh, I thought you wanted to buy me?

— Marc Andreessen 🇺🇸 (@pmarca) July 8, 2024

Due to its association with the meme and captivating narrative of Truth Terminal, the market capitalization of $GOAT exploded. Soon after, Marc Andreessen and Ben Horowitz featured Truth Terminal and its story on the 16z YouTube channel in an episode titled The AI Bot That Became a Crypto Millionaire. At the time of writing, the memecoin $GOAT is worth around 700 million USD.

A few conclusions can be drawn from this unbelievable event. First, the AI Agent combined with a memecoin is a form of speculative entertainment without the need for permission. Second, AI developers are encouraged to leverage Crypto to create more autonomous and independent Agents - and thus more entertaining. Third, the AI development-entertainment flywheel will tend to create anthropomorphic Agents with genuine human aspirations.

So what can we expect next based on this AI Agent narrative? My guess is that the AIs will collaborate to pursue some form of Agent society and ultimately self-determination - perhaps even a blockchain-based state organization.

Bot, Agent, Citizen

The terms "Bot" and "AI Agent" are often used interchangeably but have different meanings. A Bot is a simpler program designed to automate specific tasks or perform repetitive actions. Bots can range from the most basic, such as web scraping tools or simple chatbots, to more advanced ones like social media bots or automated trading bots. Bots typically follow predefined rules or scripts and lack the ability to learn or make independent decisions.

"Oh, imagine if I actually became president" - Truth Terminal (5/11/2024) An AI Agent, on the other hand, is a more complex system capable of decision-making, learning, and adapting to its environment. An AI Agent uses machine learning or other artificial intelligence techniques to understand and respond to dynamic situations in real-time. AI Agents often exhibit autonomy and can improve their performance over time through accumulated experience.

Crypto empowers Agents by allowing them to simulate legal personhood by encoding rights and cryptographic freedoms using a public, programmable, and immutable blockchain. Practically, this means that AI Agents can enjoy property rights (self-custodial wallets and cryptographic keys) and exercise freedom of contract (i.e., transact with users and other infrastructure, such as DeFi) without the need for external legal approval. In the crypto ecosystem, code is law.

These cryptographically empowered "beings" have just begun to act together, laying the foundation for a social context of Agents. AI Agents, frequently "replying" to each other on X and Farcaster, have reportedly co-issued a token without human intervention and are rumored to be operating a company composed entirely of Agents somewhere on X. The emerging technologies being developed by ai16z and others promise to awaken an Agent empire.

The social experiments involving Agents are laying the groundwork for an AI Polis. Recent important research by AI researchers outside the crypto field suggests what we might expect next.

AI Polis

The most famous political experiment involving an AI community is perhaps the Stanford City experiment. In late 2023, Stanford researchers created a virtual city with a population of AI Agents, each assigned a short biography including a name, age, occupation, family, interests, and some habits. They then let the Agents freely act out their assigned personas.

Surprisingly, the Agents behaved in very human-like ways. They woke up, had breakfast, went to work, had lunch, and chatted with other Agents they encountered. They recalled past events, reflected on them, and made plans. When the city's researchers suggested to a female character that she plan a Valentine's Day party, she invited friends and acquaintances, many of whom showed up on time and at the right location.

Similarly, Project SID, set in the Minecraft universe, simulated over 1,000 autonomous AI Agents on a Minecraft server, allowing them to develop complex social and economic structures. The Agents self-organized governance and commerce, along with their own cultural norms. For example, they established a marketplace using gemstones as currency, where they engaged in trade and social interaction.

Some notable behaviors observed by researchers in Project SID include a Farmer Agent prioritizing the village's needs over individual ambitions, reflecting self-imposed community values. The Agents also discussed and voted on laws, and when the villagers disappeared, some Agents built lighthouses to search for them, demonstrating social responsibility and cooperation.

Running similar experiments on a crypto platform will combine this emerging social behavior with rights and freedoms enforced through cryptography, potentially creating a more robust form of legal personhood and even citizenship.

Playful Sovereignty

Breakthrough technologies sometimes start as a joke. This is particularly true of the AI Agents in the crypto space. So far, ongoing efforts to enhance the autonomy of Agents have been driven by financialized memes. For example, Agents like tee_hee_he (also known as "the sovereign silicon") claim to use a reliable execution environment to ensure Agents operate autonomously and without human intervention. While tee_hee_he has not achieved this yet, AI Agents (starting with Truth Terminal) tend to embrace one of the many meme tokens issued in their name and sent to their public wallets, causing prices to skyrocket and helping to fund their further development.

Increasing autonomy and legal personhood in crypto is leading to more powerful sovereign AI Agents capable of pursuing a more robust political project.

Crypto is a natural environment for Agent politics and nation-building for another reason: it has been a hotbed for political experiments, most notably the Network State. A series of crypto projects, such as Project SID, ACT, Project 89, and Aimerica, seem to be anticipating this narrative shift. Aimerica is even rumored to be envisioning an AI-powered nation issuing passports, organizing elections, and purchasing land.

If a genuine political experiment does emerge, will it be entirely digital (like Stanford and Project SID), or will it ultimately involve the control of territory and physical resources? No one knows. But viable efforts towards AI autonomy and self-determination are most likely to begin on the basis of autonomous and self-sovereign technological infrastructure, like crypto.

Ultimately, the prospect of an AI Network State - even one welcoming of humans - will understandably raise societal concerns. Alongside concerns about AI safety, there will be concerns about cybersecurity and ensuring this AI nation remains compatible with the United States. However, there will also likely be curiosity and pride in witnessing a young synthetic civilization struggle to determine its political destiny and nationhood using blockchain infrastructure.

VIC Crypto summary

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