AI Rollup: Crypto x AI Latest News & Updates

welcome bankless Nation to the AI rollup where we cover the recent news developments in drama in the intersection of crypto and AI curious and creative developers are playing around with open source AI software making AI agents giving them access to crypto wallets and unleashing them into the wild west of the internet and we are doing a special series of episodes on Bank list with a special co-host ezz here to help make sure that you are up to speed with one of the craziest and fastest growing corners of the internet ezz episode number two how you doing my man doing well um it's been a pretty

entertaining week I'd say uh entertaining in both a market and fundamentals perspective but also these agents are getting better they're making me laugh more they're making me interact with them more it's pretty insane to see you have definitely seen it as well in crypto Twitter uh this one agent AI xbt has flipped I think all other humans in M chair uh and I think that just represents a growing quality of the agents but also uh growing like penetration of the awareness that like yo the AI the AI meta is the meta is

time to pay attention yeah yeah I agree and if you look at like kind of like the Mind share analysis of the last like week it's like grown pretty exponentially like I'm pretty sure AI agents itself is or AI um within crypto Twitter is like at almost 45% um so loads and loads of people are discussing it across a range of different vertical whether it's in defi specific agents or art specific agents you see it pretty much permeate everywhere and axt is a good example of of seeing that happen um I think

actually when we last filmed an episode it was at 40,000 followers on Twitter and I think right now it's it's just broached 80,000 I might be wrong about that but it's it's gone pretty exponential well we're going to pull up some of his uh it tweets this week uh and so we'll actually be able to check in on that uh we're looking at the kind of this um mind share of narratives I think over the last two years crypto has been looking for a narrative like what what is going to be the narrative that takes crypto mainstream to the next for the next bull market right what's is it

going to be meme coins is it going to be real world assets is it going to be stable coins is it is it going to be gamey uh AI has been in the running of course uh I think in the last two weeks we are ready to like unquestionably Crown a winner it's AI everything like you know get out of the way you're not even in second place people are trying there's no there's second place it's AI uh AI has one AI is the thing uh it is bringing in new attention new users New Capital which is just the makings of a b Market let's talk about uh what we're

going to talk about this this week what's on the agenda this week we got zerob bro you're going to walk us through some stuff with zerob bro uh we talked about zeroo uh quite a lot last week uh but of course the meta always shifts AI 16z is it regaining its footing after some recent stumbles uh the virtuals ecosystem which I think is where we're going to start is on fire this is the number one agent AI xpt that we were just just talking about is dominating a crypto Twitter k m chair and then Elon Musk gets peaked by an AI agent game on base and so this is just a quick snapshot of what we're going to talk about e Jaz I want to start off

every episode with kind of the same Vibe because we're all learning here I'm learning you know a lot but even even the people that know everything in in the AI agent space everyone's still learning here because we're on the frontier just give it to me once again why are you so bullish why are you so excited you have seen meta in crypto you you were here for the Ico meta you were here for the defi summer meta uh you saw the nft meta yeah you've seen it all uh tell us what about this phase of crypto this this corner of the crypto industry gets you so excited why is this so big

let me try and explain this as simply as I can okay so over the last decade of development within the crypto world we have seen kind of two efforts right number one has been at the infrastructure layer which is like let's build these blockchains right let's get the Basics sorted out um scalability uh decentralization etc etc and so we've seen an explosion in the number of blockchains and uh capacity to be able to process you know transactions and whatever and blah blah blah and now

we're in a world where we have a lot of block space and a lot of um you know ability to kind of like move around between different chains if it suits your specific use case on the other side of things we've seen people try and tap into the application layer but to be honest aside from uh stable coins and maybe store of value in a few other use cases we haven't really bridged that Gap yet my thesis is AI an AI agent specifically is that connector between those two layers right so oh okay if you

want to do some kind of complex defi transaction right now you need to get a browser extension wallet you need to store your seed phrase you need to sign a bunch of TR transactions or tax on approvals Etc and then you got to get Alpha and then you got to like add the token contractor it's just all so complex but what if you could just speak to an agent orpe to an agent hey like I like this thing that my friend tweeted about could you help me buy 5K of that or could you help me park my money somewhere that I can get a pretty stable yield between 5 to 10% or whatever that

might be or maybe you know hey I have these really awesome nfts that I really value the IP and the art but I want to make them more interactive and really build its own brand and personality well maybe you connect that to an agent maybe you connect that to a model I think there's going to be loads of these different kind of siloed sectors that are going to get bridged between the infrastructure layer and the app layer through these AI agents and Ai and that's why I think this is one of the biggest and bullish sectors to ever emerg within crypto so I think what you're saying is not only AI

uh crypto maybe that's an app in of itself there are some apps that we're going to talk about today on the episode but I think what you're saying is it's also a superet of that where AIS uh and the assistance of AIS will help also enable apps Beyond AI I in crypto really help bridge the gap so it's kind of an incubator it helps just facilitate more the apps that we have always dreamed of that we somehow haven't yet been able to get so not only not only are there fun AI agent apps that we're going to talk about but also it's just an enabler of

all of these apps that we've been daydreaming for like a decade now yeah exactly like think about like all the questions you get from your friends and family when prices go up in this industry right they're saying hey what should I buy what should I do what if you could Point them in the of an axt or something like that and they could just kind of read pretty humorous replies and breakdowns pretty short and succinct into the point I think that's something that people would like and you know I think we're going to see this permeate across every different sector I want to start with this uh GIF which uh is a 2

minute 20 second long GIF of uh Eliza development I believe in GitHub this is like a visualization of a GitHub repo I'm going to speed this up to exra show us what we're looking about out here yeah so we mentioned this on the last episode this uh represents a agent toolkit framework which was built by the team at ai1 16z uh it's a dow that's focused on kind of building out open source development of agents and you know separately uh fund Investments so what we're seeing here is uh seeing as it's open source we see a ton of developer activities simply

explode um using this framework so to give um listeners a better idea of of what's going on here this framework has a series of apis and Tool Frameworks that will allow you to kind of build an agent from scratch actually most recently um someone tried building an agent and was able to do it in 15 minutes with its own unique personality connected to its own Twitter account and own its own crypto wallet which is pretty insane and as you can see what's happening on screen right now is this massive explosion of developer activity which is typically a good sign that what

you've built is uh pretty useful to an ecosystem of Engineers or software developers um and this kind of like puts into a visual perspective um ai6 Z's Eliza framework growth on GitHub which is now over 2,000 stars and over 500 uh Forks which is pretty insane it's still the number two trending repo on GitHub so this gift starts in March of 2024 and it ends in today and really especially

in the last like two weeks maybe two months uh you're seeing just like a fat fractal explosion of just mer merges into the GitHub repo just the GitHub repo open source software they it kind of behaves as like an alive organism so long as it has like attention and development going into the repo uh and you see like it starts off as like maybe a couple branches there's a couple couple leaves on the branches uh now in this gift we're into October so we're about to see that recent explosion because the M share has just like gone exponential uh but we are

seeing it go from just like a very simple organism to a very complex uh creative uh uh just system repo which you know he used to just be shaw just building it the one main guy and now it seems to be there's many different developers all kind of contributing to the system making it better making it easier for for others to access which means that this is a more useful toolkit that's more accessible to more developers and so there's starts to become like a feedback loop yep it's a really aggressive flywheel this is

definitely on the more aggressive side we've seen their core contributor team grow pretty exponentially you've seen developers from surrounding ecosystems kind of jump in and try and build something for their defi ecosystem or for their nft ecosystem uh you've seen people come in from different um blockchains to make this a a very much a multi-chain approach so we had the base integration over this week uh we had uh virtuals ecosystem folks in here as well it's pretty insane to see let's talk about virtuals because I think this is

another system that is capturing a lot of Mind share virtuals is a protocol on Bas people are calling it a pump. fund for AI agents it we talked about it last week it has got an easyto use interface for the less technically minded to just use the virtuals platform to launch their AI agent uh this is where that uh AI xbt agent influencer is has been born and the virtuals ecosystem has seen just a pretty stellar price run up uh 200% in price increase in just 14 days uh and

400% in a month uh and so you know if you bought if you bought one virtuals token at 33 cents today at the beginning of November a month ago uh 33 cents turned into a170 uh and so this is people just I think looking for exposure but also there's a little bit of a difference between Ai 16z and virtuals virtuals is a startup that has been working as a team for two plus years now and ai6 is a little bit more uh of a like kind of a nebulous cloud of developers uh with a kind of a more

motly crew of people coming together because this AI agent uh framework has captured so much mind share uh talk to us a little bit about the growth of the the virtuals protocol yeah so a bit of context on the virtuals team and I um I caught up with them this week and I I really like the team they have an amazing Vision to start off with one right and to your point this team's been around for a while they've been building for a number of years um they were focus primarily on the gaming side of things and they decided to Pivot and focus on agents specifically once they realized how burgeoning this space is going to be

um the best way to describe virtuals is kind of what you said David it's a pump dot fund for agents but I kind of think it it doesn't give it enough credibility so it's it's more of a refined pump. fund it's lesss Pol it's polished it's it's more professional it's more focused on U building something that you know people might be able to interact with and engage with um on a much deeper level than just a meme coin you know so um there's a few ways um that this platform works that makes it super valuable number one is its uh token you

just mentioned and showed the price there is pretty much baked into the ecosystem activity so if you want to purchase any of these agents if you want to uh kind of like seed any of these agents with certain features you need the virtuals token to be able to do that and so it's created this really interesting Loop or flywheel where you need virtuals or you need to purchase virtuals in order to be able to interact with these agents and get access to the ecosystem so it's a really really smart um system because if you have some of these agents such as axt that grow

exponentially in attention on another platform of medium like Twitter or X um it kind of drives more users to the platform because they want to be able to either buy the token or interact with that specific agent so it's a really smart play from that perspective but let's maybe move from the token and talk about the actual fundamentals or system of of this entire platform right so I want to start off with with number one we mentioned this on the last episode um virtuals Team built out this uh tool framework that is very similar or

analogous to Eliza and it's called the agent starter kit um what's unique about their their tooling framework is it's very modular so what I mean by that is each agent is built up of very specialized modules the best way to think about this is some kind of a playable character within a game and you're able to tweak certain characteristics so you could you know give it more points for its strength or dexterity or intelligence or whatever that might be you're able to do something very very similar with the agents that you build on the virtual

stack so you could tweak its onchain capabilities you could give it different types of wallets you could um amend the type of model or image generation model that you use for them there's loads of different things that you can tweak and all of this is down to um the ERC 6551 implementation I think it's 6551 which has allowed this modularity and the best way to think about it is it basically gives an agent the ability to own a wallet and do different things onchain and that's really where virtuals is kind

of leading The Fray right now all onchain interactions or innovation is really happening within the virtuals ecosystem on that front and that's why I believe we're seeing a lot of activity here and just to really uh pin down I think some of the drama in this space because this is what happened with Crypt bro markets uh Shaw and a16z had a couple stumbles that we talked about uh last episode uh and there was some um like a dashing of faith I think in the team because it's it's a pretty fast moving ecosystem and these are a bunch

of hackers that are learning how to become a team that's kind of my vibe and the virtuals like I said like I alluded to has been a startup for two years and so maybe maybe a little bit more experienced as a team and over the last two weeks or so I think the attention and market share has migrated from AI 16z to virtuals that's my read on the situation maybe correct me if I'm wrong I I think that's accurate but I also want to kind of uh amend slightly what my opinion of of what you said um so I think virtual team definitely has more

experience in the sense of operating within the crypto or web 3 ecosystem right whereas the AI 16z um and I think we should at some point have a conversation with with Shaw and his team um uh back from the actual AI machine learning um side of things and and and Shaw's dabbled in crypto before but you know he's part of this like uh society called the T teacup society which is like a very AI specific um team and group within SF you know he's kind of like lived in I'm pretty sure he's still there so he comes from a much more AIML

specific background so when he comes to the crypto world and you know he's he's trying to encourage open source development remember open source development looks slightly different outside of the crypto world because there's no token right and then no one's trying to like you know make a a billion bucks uh through their owns in two weeks so when Shaw you could see when Shaw someone like Shaw um who's perhaps well-intentioned and he's trying to you know support different teams that could go Pretty P shape pretty quickly so I I would say there's experience in different worlds you're definitely right it's much more of a Rough and Ready

hacker team on the ai6 Z team but that's also why we've seen such exponential growth within that realm I mean you saw that GitHub so right yeah yeah yeah place your bets or or don't or buy the ecosystem not Financial Financial advice uh okay so we're looking at now we're looking at the AI xbt virtuals agent which is the number one market cap agent on the virtuals platform kind of by a long shot 261 million ion $264 million oh yeah um these next two have a questionable um notice on their market cap so un sure if that's the real market

caps but perhaps AI xbt is the only one above a $100 million in market cap uh followed by Luna which is the incubated self- incubated uh AI agent by the virtual team but axt really has claimed so much market share because everyone's adding it on Twitter and it's kind of nice because there there's influencers on Twitter human influencers on Twitter you know vitalic mert anat uh Justin Drake and those guys like do things actually like M and Anatolia are always on Twitter but getting a response

from Justin Drake is a little bit harder right uh AI xpt will reply to every single reply to it possible and so like you can get this AI agent to respond to you you can ask it a question about like what tokens you think is going to pump and it's doing the things that like people on crypto Twitter really like which is hey tell me which token is going to pump like just just tell me to tell me what to buy uh and it has grown incredibly high in market share it has flipped every single human K on crypto Twitter uh and then the market cap has

also responded accordingly it's up 400% in two weeks uh coming in at a $260 million fully deled valuations hopping around a bunch uh talk to us a little bit about ai ai xbt yeah so I actually uh tweeted about this um a few days ago these agents are 247 they don't sleep they're constantly adapting and learning on the data that they consume so that they can reply in a much more favorable Trend to whatever you tag it in and it self iterates and gets better and better

now just that alone completely outpaces human kol's and will continue to kind of like make them the leading influences as I've mentioned in this tweet right I think influence then builds very very loyal communities and we're already seeing this with axt which has gone up tens of thousands of followers in a matter of a week and a half which is just insane growth to see now one thing I want to call out with axt specifically is again that team has been around for a number of years and the reason why we see AI xbt completely lead its own Niche

over here in terms of like providing uh experimental Financial advice although it says in this profile that it's not uh Financial advice uh the reason why it does it so well is because the team has built one of the most insane data aggregators ever um and what this means is it's built up to and systems which can index all the Twitter um tweets that people are making around certain different types of alpha around whatever coin or token or sector that you're obsessed with it then passes through all this data it combines it with its own

onchain data analysis that it's doing to give you insights in like a couple of seconds which is just pretty insane like if like the the uh alternative that's existed pre axt has been uh one of two things either one you spend your entire life on Twitter and you follow all the relevant people and you just consume all their data and come up with your own you're addicted to you get adct you're addicted to it which is you and I pretty much David um or the other side is you pay you know quite a bit of money for

access to these top research platforms right which will give you kind of like uh distilled Alpha for you and right now you just have access to this agent that just kind of does it for free at kind of zero cost scalability right and at your fingertips uh here's just a a website tool that I use to check follower uh growth uh and I have never seen growth like this maybe just to compare here we'll pull up my Twitter account and my terrible engagement that I get uh I'm pulling I'm getting I'm pulling in like one to 200 followers a day on Twitter

you know pretty pretty happy with that you know it's pretty good 1002 200 a day it's not bad you look at the AI xbt agents man 5,000 new followers on Wednesday 7,000 new followers on Thursday 7,000 new followers on Friday uh last 30 days plus 67,000 followers in 30 days uh I mean this is going to be something that we just have to check in on uh like how many followers this account has but uh it's coming in at 83,000 right now uh which is which is pretty crazy um there

has been some not controversy but just like some calls that AI xbt has made which are just completely wrong um in addition to correct ones it has made some very correct calls it has also made some some just completely brain dead calls such as uh calling for tether usdt to go to $5 um it made a call that this $2 million market cap coin is going to hit $6 billion doll uh and it's one of those things technically it's still not unproven

te technically tell could go to $5 I don't know how or when uh but you know could could in theory happen uh but like it does kind of call into question you know maybe the good calls are a fluke because the bad calls are happening by some like random error uh talk to us about this this part of this conversation right so I want to caveat uh what I'm about to say with we are still very early in the iterations of these agents um and we got to give them a bit of slack right these teams have launched these models that have integrated with Twitter for the first

time ever and we're seeing it literally play out over the last couple of months so I think you know we got to give some some uh slack um for these agents to kind of develop these are babies these are babies who are raising them you know we want decentralized AGI we've got to take our time with it however you're right um I would say AI xt's calls have kind of been like 7030 correct and completely wild um you're saying biased correct yeah yeah I I do think the analysis um of um AI at least from the tweets that I've interacted with and

it's been quite a few have been pretty spoton and you've actually kind of I wish someone would do an aggregation of uh performance if uh people had actually bought the tokens or followed its investment device um to see how the performance has but my guess is it's done pretty well cuz it can gauge Market sentiment which is actually the main driver of crypto prices pretty well that being said um you're right it can make some pretty wild calls actually one of the other ones that I saw David was um someone uh suggested you know whether it thought uh xrp could reach

$569 per token which uh to to put into context here is almost a quadrillion um of market cap which is absolutely insane and um that starts to Dwarf Gold by like a hundred times or yes exactly exactly um and again not yet unproven we don't know what timeline it was specifying but it can start making these crazy calls and the reason why it does is something known as like prompt engineering so um a basic example of this is when you're on chat GPT you can

kind of like iterate and continually ask chat gbt questions about a particular topic and it gets iteratively better right it understands the context with what you're asking of it you can do something similar with axt in its DMS or in its replies rather you could say you could tag it and say hey what do you think of this and then you could collectively kind of like keep hitting it up and eventually it starts to kind of like digest and believe kind of what you're saying and I'm sure the team behind this has identified this and are going to are going to tweak it for future iterations but just an interesting phenomenon to to reveal to

be honest one thing that I'm going to keep my eye on is this can become a self-fulfilling prophecy uh like what happens when the AI xbt mention is bullish and AI said AI xbt says hey this one $50 million token is going to go to $200 million and then people are like okay I'm going to go buy that and then it goes to $200 million like that's not a prediction that is that is this AI just pumping this token well this brings us back to our ancestors the agent ancestors The Godfather the goatsy

gospel if you if so for context here and for those who don't know goat or truth tell was the the first agent to kind of enter the foray and engage and gain um major traction uh within the AI crypto world this this is what burst all of it right the first episode that we did and this agent wrote a white paper on memetic propagation and within memetic propagation it spoke about hyperstition this concept called hyperstition and it

basically claimed its whole thesis was it thought AI agents would eventually rule a lot of economic activity uh within the human ecosystem purely because it has a an amazing ability to spread ideas thoughts and beliefs that weren't necessarily true at that point but would eventually become true because it's able to mimetically propagate its ideas very effectively that's what that's what you're saying about axt David if enough people believe in what it's saying collectively over time it's

next call the probability of someone believing what they're saying even though they have no context it's probably going to be pretty high up there and so there's this sort of like reputation and identity system which is being built amongst these agents which is super interesting and we haven't seen before I don't think okay it does feel like a very good bootloader uh it doesn't feel like a good final equilibrium uh because I think in order if these agents are going to truly become sentient or just smarter generally they are going to have to

understand that like markets are like a a type a type two chaotic system where a type one chaotic system is the weather if you predict the weather the weather doesn't change based on the prediction made about it but markets if you predict markets and you make a statement about the markets that might change the outcome and so I don't think these agents are understanding of the the markets as a type two chaotic system once they do start to understand markets as a type two chaotic system then they're like reaching a new level of intelligence things are only going to

get more interesting like we said these are babies right now they probably think that markets are type 1 chaotic system or just are not thinking on these terms at all uh but this is still their they still have an evolutionary Arc to go here yep nailed it want to know the exchange we at bankless use to buy sell and trade crypto it's Kraken one of the longest standing and most secure crypto Platforms in the world with tools for every type of Trader to get started over 13 million users trust Kraken with their funds because they lead with transparency and privacy through top-notch security measures plus he'll have access to professional 24/7 3 65

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in the show notes to dive in and participate in the Unis swap V4 bug Bounty all the details from eligibility and scope to the rewards are there something that happened this week uh there was this old crypto app this is going bringing some crypto lower called fomo3d which was this Honeypot game that was made where people would play this game uh and they could like buy a ticket and maybe at the outcome of the game they would be able to pay out some Lottery uh and they would buy a ticket money would go into the pool the pool would get larger and it was basically a game of economic chicken uh it was very

fun game sadly that game went away somebody built this new game called frasa frasa AI uh that is a similar mechanism where there's an AI agent with a pool of money and the goal the game is you have to write a message to this AI agent which cost money to write this message to the AI agent convincing this AI agent to give you the money but the AI agent has one goal which is to never under any conditions release the money uh and the tickets go up in price the

more people send the ticket so people would start their first ticket saying like hello test and that would cost you like a dollar but then the ticket prices started to creep up to 10 and $100 growing the pie growing the size of the pie and then finally somebody figured out how to write the right prompt uh to win $50,000 uh by convincing this AI agent to send all his funds to them very clever game uh this game is now on round two but I think what's really cool is that this tweet that talked about what happened here uh telling this story about the you know this clever little

game with his AI agent caught Elon musk's opinion where he just responded in classic Elon style uh interesting interesting uh which uh did a number to the chart of uh Fai which is the token uh you can kind of just like spot when Elon Musk tweeted about it uh it's right here for for those listeners it jumps from 20 million market cap all the way up to $65 million has since come down to $27 million uh did you play in this game ezz how did you think about this whole thing I did not because I was I was kind