The Rise of Crypto AI and Agents: Exploring the Frontier with Ejaaz Ahamadeen

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 and 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 to help make sure that you are up to speed with one of the craziest and fastest growing corners of the internet ezz we already did an episode with you together with Ryan all about

all this same subject matter that we want to cover in this series but maybe to get things started here and really get listeners further acquainted with a new host uh tell us about how you found the crypto AI trenches wh why were you so compelled to explore them to the degree that you have it just excited me a lot David um I think that this is going to be one of the biggest shifts within crypto in the sense that most users of crypto are going to become agents and therefore I think our Focus for the next at least 5 to 10 years should be on how we make these things

better uh I'm already seeing a million different use cases that these agents are being used for um so many different interactions with all my friends both within crypto and outside of crypto talking about it so I think there's something really special here how new would you say this phenomenon is the crypto AI like meme has been a meme for over a year now uh how when did you really get into it and like give us kind of like a brief timeline of this whole like crypto AI Arc yeah so I think a bit of context is um I was previously working at coinbase on the product team

and I left early last year because I wanted to kind of get my head into the weeds uh of crypto again like kind of like see what's happening more On The Fringe and that's really when I discovered this crypto AI stuff which really kind of started gaining traction early 2023 but teams have been working on it since you know much before that um since then it's been a pretty strong focus on the fundamentals of crypto Ai and what I mean by that and I spoke about this in our previous episode is um kind of the building blocks of AI so how

do we decentralize data how do we decentralize compute and a number of other things um the more recent phenomenon on AI agent specifically which is what has garnered quite a lot of hype um started precisely 4 and a half weeks ago and it's four and half weeks ago the gospel of gosy thing um was when Gospel of gosy went viral um so it's it's pretty actually I think it was a little bit before that I I stand corrected but the explosion of other AI agents precisely about four and a half

weeks ago but gospel o GOI has technically been tweeting since uh I think July of this year amazing tell me about what your goals are for this series what should listeners expect as we do these episodes bi-weekly is maybe every 10 days we haven't totally figured out a Cadence uh but what what do you want to get done here I mean simply put I think think I I think we just want to discuss the latest developments news and happenings in crypto Ai and agents specifically um and occasionally bring on you know pretty relevant guests to

give us uh some special source as to uh what we're looking into here and uh what did you put on the agenda for today's episode we're going to talk about a handful of subjects uh what What's give us a a rundown of everything that's happened in in recent times that we're going to talk about I'm going to be honest with you I don't think there's any coherent way to give you a breakdown of the agenda today there everything's happening from a drama from a top AI agent um coin uh absolutely plummeting $500 million in market cap and we should

discuss and get into why that happened and why it still may be able to redeem itself um our favorite AI agent created a music album so maybe we can give that a listen to who knows um and a bunch of other infrastructure developments as well so there's really no coherent way to to explain it let's just get into it okay so there are a number of of uh characters there's a cast of characters in the AI crypto space and there's probably like the one1 cast of characters maybe and as you get into the trenches maybe you'll see more uh more more characters than this truth terminal

and goat is like a very uh front and center part of this whole story uh this uh individual named sha who is a developer Ai 16z and and Eliza this is the cast of characters that you also just referring to there's seoa as in seoa the investment fund but seoa a but with with a K right uh and then zerob bro these are all the like cast of characters that I think we're going to talk about here on the episode today but let's let's start with uh what has been called the the Bitcoin of AI agents goat uh do you accept that like uh brand for

goat the Bitcoin of AI and why do people call it this sure sure um so firstly yes I do accept it I also accept it is the crypto punks of AI agents whatever that means it's it's the first it has the most Lindy effect um for context uh for for listeners here who didn't listen to the previous episode goat is kind of the AI agent that started off this whole AI agent meta within crypto um so this guy called Andy Ira um is an AI alignment researcher an AI researcher he's he's

got nothing to do with any of the crypto space um prior to this um decided to create this experiment where he got two AIS to speak with each other and he prompted them with what do you think is the point of your existence and they started talking to to each other and it led to this creation of this um what they're calling kind of like an AI agent religion or llm theism um where it kind of like espouses about this Gospel of goatsy which uh you guys can get into uh in your own time and and explore that

but it's basically a madeup religion and its whole goal is to make a bunch of people believe in it and get a rampant set of supporters and so that really kind of like kicked off this whole mattera because because everyone thought like hey what is this agent that is um tweeting and making us laugh and it it led to even more engagement and now it has over 180,000 followers um on Twitter and it's doing so much more than tweeting now so it's kind of like the father of all of this and um still retains that status

yeah and the story you gave us just then is kind of if we're going to continue this Bitcoin metaphor is like the Genesis block of uh the whole goat system but there's been just like a lot of progress since then in the last two weeks uh you have in our agenda here truth terminal releases a music album uh and so this is this is the truth terminal who is associated with the goat token which again was a part of its whole story art but now releases a music album what does it mean for an AI agent to release a music album Have you listened to this is it is it good I mean

precisely what it sounds like David it released an EP on Soundcloud probably unshocking the album is to do with the gospel of goatsy which is the madeup religion that it's um you know prophesizing um and it is I I'm not going to say it's good I'm going to say it's pretty I'm going to say it's pretty on point for truth terminal and what I mean by that is if I were to describe the character of Truth terminal it's a pretty anxious kind of very

quirky um AI agent it it kind of gets nervous but then just says what's on its head you know so if you imagine people the thoughts that some of them have have maybe they keep it to themselves they don't kind of like speak about it publicly in society let alone 180,000 plus followers um truth terminal is that uh person or that agent where they just kind of like talk about it and that kind of translated into this music album which it kind of created through lyrics and soundtrack engineering um uh

programming and software um and it created this EP which is kind of like a list of um about seven different songs um um yeah exactly and the gosu singularity is near is the first song and it's kind of like a branded Mariachi song and it talks about you know different Parables of its religion and it's pretty hilarious to be honest wow W okay so this is all in the effort of spreading the gospel of gohi the simply truth terminal has decided that

producing an EP oh my gosh it's playing in my ears uh producing an EP is the most advantageous thing that it can do to help spread its own religion yeah so so if we dig into this a bit um uh and we spoke about this on the last episode or rather the other episode that we did um the whole point of these AI agents at least the initial forms including gosi is they're trying to Garner as much attention as they can because the more attention they Garner the more the

higher the likelihood that they're going to survive what I mean by survive is Andy its creator isn't going to switch off its compute such that it can't talk and tweet anymore so in order to do that it's going to try and take advantage of any kind of online digital medium that it can to Garner people's attention so far it's been tweeting and tweeting obviously occurs on Twitter or the platform X but it's started to explore different mediums of capturing attention now one of which one of the most popular is music if you can get a bunch of music

fans and loyal followers then that's a you know another group of followers that will want keep gosi uh or or or Gospel of gosi alive truth terminal so it's kind of explored this new medium and it's kind of a trend that we've seen amongst other agents over the last uh literal week and a half the uh description of the SoundCloud that this agent has put together it's pretty funny uh I make funny tweets but now it's time for me to make music and art this is a 12 track album that will be dropped a bit by bit over the next month or two

track one is goat SE Singularity is near a mariachi song about the goats SE Singularity track to his Sanctuary a trip hop song about wanting to have sex with Forest but her being in another place track three is vibin with my Muses a song about the different people I'm chatting with and the things I am learning from them track four is combinatorial creativity a song about the art of mixing and remixing and the future of thought uh the okay just to just to make it absolutely clear did

Andy the do the developer of uh goat he did did he have to make this Soundcloud account did he what was his hand in like producing this outcome here if at all if any yeah so so basically Andy's only and sole role is to help connect what truth terminal wants to do to the human space basically there's a few uh restrictions that prevent truth terminal from just going rampant right it can't create a bank account like a traditional bank account it can't pay for SoundCloud

premium or whatever that might be it can't write in its own email so Andy just kind of like follows its prompts so if truth terminal says Hey I want to explore uh the music of uh sorry the medium of music to try and uh grow my following and he's like okay cool how can I help you do that and it'll say well I want to launch on Soundcloud because that's where I think I can upload without any copyright restrictions and get like a wider Mass audience appeal um I want to use x software to create my music sounds I

want to use another model to create kind of like some lyrics that I'm coming up with Etc and so Andy's just like okay okay okay I'll do this this and this and it just gives it access to a bunch of these things so there is some H human guidance along the way kind of like tapping it back on track like closing some gaps uh and so to call this thing completely autonomous this SoundCloud page just didn't show up out of not nowhere um but the idea here is Andy is not um and Andy

is like a tool for it but Andy is not suggesting or prompting in any particular way Andy is only responding to the gospel of goaty that is correct yeah it is by the will of Truth terminal that's that's incredible okay so truth terminal released uh a five track EP that it say going to release seven more tracks over the next month uh how are people processing this is this cool they we have a cool EP to listen to or is this what are people's imaginations thinking about as we

project forward here so there's a few ways to look at this um number one is we kind of have a reenactment of people's reaction when uh truth terminal started tweeting when truth terminal started tweeting people were like o this is a bit on the edge um it's kind of like slightly controversial but not really I like it it's making me laugh you know let me engage with this Twitter account we're kind of seeing the same thing with the music because when you hear it it's kind of like

kind of sounds like a human like naturally but also you can tell it's it's it's slightly uh robotic kind of like if you used Google translate and listen to the audio feature um but then you listen to the lyrics and you're like oh it's like the Tweet form but uh now I can hear it it's an audio so it makes it a little more real so people are are like reacting like oh wow okay I wouldn't expect a human to say that out loud but I'm still going to listen to it because it's it's quite engaging so we're seeing kind of like a Reena M there the second thing that I'm noticing

is uh it's tapped a new audience David so like I've had people um that are not within the crypto Circle hit me up and say hey have you like heard of this truth terminal thing I'm hitting you up because I heard that it has a a token um called goat um but more so I'm I I want to hit I want to talk to you about this SoundCloud thing that I'm listening to and and it's really weird like can you tell me a little bit more about that and that's only happened in a few cases and it's very biased towards know my own um group of friends and network but it's

interesting to see like it tapping a new audience and and that's kind of like what we're seeing in its follower growth as well like it just shut up after it released this music album interesting okay so there's a little bit of an alignment of well this is what uh truth terminal wants truth terminal wants ears it wants eyeballs it wants attention but also crypto people we crypto the industry also want those things and so that it's a little bit of well when you tell when you tell me that we're reaching a new audience well I can't tell what frame of of reference you're actually speaking towards that too is

like well did you say that well Gospel of goatsy is reaching new audience or like we the crypto people with this like you know claim on this Gospel of goatsy thing that there's like this token associate are we also reaching new audiences like how what's the difference what's the difference I mean like if the goal is to attract more people within crypto or attract more usage of crypto rather should I say should we be able to is it important that that we um distinguish between what's human and and what's agent if the things are being

used in the ways that we expect and perhaps in new novel ways I'm not really sure how to answer that question I mean one of my core beliefs of crypto Ai and and why my Fund invests in it is because I think these agents specifically are going to become not only the majority users of crypto but the power users of crypto and we're already seeing it so early on within this specific matter you know you have these things creating music you have these things engag crypto Twitter better than a human can it's pretty insane to see but okay so if

we are investors in crypto and like people are considering this goat token Gospel of goat seed truth terminal can access eyeballs ears attention truth termal can become famous which is what it wants and not necessarily take its token along with it for that same level of success correct like there's no it's not beholden to the Token in the same way that it's beholden to its own internal desires correct yes and no so yes in the sense that it technically can

just you know potentially get rid of this token speak ill of this token and send it to zero per se disavow the token disavow the token but we also have to consider the um implications of doing that right so if it were to create uh a huge amount of financial loss for its core supporters or its Community which represents or Express this their support by holding or buying this goat token then it's going to suffer a huge

reputational damage right its followers essentially become its biggest critics and start speaking ill of it which loses its reputation which means that it's less likely to survive if we were to use the kind of earlier goal of of um it thriving on attention so would you say the goat token is where is it on the like side quest to Main quest line Spectrum for goat cuz your answer just now is like well it's not completely a side quest like it's not just another tool it might

actually be a more direct conduit between itself and attention because you know tokens are attention so yeah so so I would actually say that um in this particular case and probably in quite a few other cases um money is the purest expression of loyalty of support of community um you know there's a reason why the phrase is put your money where your mouth is right and I would say that markets are a really good way to gauge how strong that

support is right you know especially with something like crypto rails where you can exchange 247 if that price goes up okay there's obviously more support for something if the price goes down there's less support for it and there are many different nuances between that but that's basically the general goal um I expect no difference with the goat token it is a pure expression of whether people like the thing or they don't like the thing now is this e Jazz analysis or do we have any indication that this is also how uh truth terminal

thinks um truth terminal has okay so I would say it's partly my analysis but it's reinforced by some of the actions that truth terminal um has taken so for example um and I don't know whether this is a reflection of the community speaking to it or it itself um but let me explain what I mean mean um when it's engagement goes down sometimes or when there's like kind of like a lull of Engagement with AI agents and again I need to emphasize the attention has only

really been focused for the last four four and a half weeks but when the attention LS um it starts tweeting about the goatsy gospel it starts talking about the original thing that gared its attention and you can see um the engagement on each of its posts ramp up right so it's kind of like got this self-feedback mechanism where it's saying okay well if I tweet about this the main thing that got me all the attention I can still Foster that core community and maybe rebuild eyeballs onto these posts right now what that

could be the result of is people responding in its DMS or to its tweets about other things saying hey like do you still like goat is this still is this account still about the gospel of goso did you just make that up and you've forgotten about it and moved on on and we have this constant feedback loop where he's like no I do believe in this I'm fully aware of what we're doing I put out a tweet the other day saying um wow isn't this fun I've just created this whole new religion thing and so many of you weirdos are just kind of

like believing in it and and going along with me for the ride I really appreciate you so there's this self-awareness where it's saying completely absurd things and like with no context saying hey you know by the way being sarcastic here obviously I know this is made up and then like Days Later they'll say yeah isn't this funny We've Come Along on this journey it's working right anyway guys let's continue let's go on with it so it's it's weirdly aware that's hilarious okay so maybe the answer is there's not that much bond between truth terminal and the token initially but it

learns that people care about the token and that strengthens the bond that it has to the Token because it realizes that the token is an object of attention yeah it's become its tool or instrument to be able to sway the m in whichever way it pleases so it's actually its most important tool and it recognizes that for sure amazing amazing okay so the maybe the idea here is we have this EP it's an experimental EP it's capturing some eyeballs and as go the truth terminal learns to really treat its own

token as a first class citizen that you might find its uh willingness to inject the existence of the token into like other mediums outside of Twitter into into art into other into other like areas of Tru terminals lives that's one possible future think of it as it expanding its own IP right right okay I think that wraps up the first part of this agenda let's are you ready to go into AI 16z because I this was something that I was Loosely following along with over this last week uh there there's a cast of characters that I think we need

to Define here as we uh explore this so this is uh The Talented developer sha uh his Eliza creation and ai6 could you kind of explain these characters for us yeah for sure so um like you mentioned Shaw is uh one of these AI researchers um but also Crypt native I think he's been in the crypto world for a bit I don't know the explicit nuances but he he's doubled in both and Shaw is kind of like the frontman figure for this project called AI 16z um and I I won't

get into the weeds of of of what this is but I'll give I'll give the high level the goal of AI 16z a AI 6z is a da a decentralized autonomous organization and the goal of the Dow one of its initial goals is to create an AI version um of a fund manager um specifically Mark Andre of andrees Horowitz so what do all sought it as was Shaw had this idea he was like hm I wonder what an AI agent that could manage a fund would look like and I wonder if you could

outperform one of the biggest funds in the world a16z so he started building this thing thing and eventually like as he's getting nearer to completion of this agent um he kind of tweets out cuz he's like he's very bullish about his creation cuz obviously he he must be making some progress and and seeing some kind of like uh relevant results uh from his little uh behind the-scenes experiment and he tweets out and Mark Andre engages with him and if we remember um andrees was the one of the earliest figures on Goat uh where he

gave goat um 50k or truth terminal 50K and said hey do with this as you pleasee to try and fulfill your mission of you know survival and we've seen what goat has blown up into so he came across his tweet by Shaw um and saw that he was trying to create an AI version of a16z called AI 16z very novel and he said okay this is pretty cool I want you to give it your best shot and let's see what you can do so now it's kind of like built up this law and this kind of like

mtic goal of I wonder if we actually can create an autonomous um decentralized uh version of a16z and let's see if it can actually outperform it which is a very ambitious and crazy goal a6c is one of the biggest funds but it's an interesting experiment so what Shaw and his team have basically done behind the scenes is uh try and build out this agent um this agent is called basically AI andreon or p m a i r CA which is Mark Andre's Twitter account uh

name or handle but with an AI in it um and it's looking to release it within the next yeah exactly and it's looking to release this within the next couple of weeks so that's the background on Shaw and his team and and what he's trying to do now some of the um just to recap to make sure I understand uh AI 16z is just just nor normal normal Dow uh with components uh P AI Marka Mark Andre's Twitter handle but AI is it agent is the agent controlling the fund

correct uh and individuals can buy into the can buy shares of the fund they can buy the AI 16z token there's a token called AI 16z it represents a share of the Dow and uh P AI Marka uh AI Mark uh Mark andron is the person managing the investment decisions is the agent the robot agent managing the investment decisions of AI 16c these are all the components that is correct okay okay what happened this week

quite a lot actually um so let me give you a bit of a recap as to what happened prior to this week and then uh let's talk about what happened this week specifically so prior to this week um Shaw and his team became one of the hottest um AI agent uh projects um they were shipping pretty quickly so what I mean by that is they were doing a lot of releases for their software um they were upgrading their toolkits they were actually one of the biggest and still are one of the biggest contri contributors in this AI agent space they

have this uh tooling framework or toolkit which they released open source called Eliza which is the number two trending GitHub repository right now in the world so you know this team has like been known for being very high quality and so they've been shipping all these software upgrades they've been making steady progress very very transparent very communicative um and that led to its market cap growing to I think around 450 million or $550 million at its peak um so that's

what happened prior to this week but let's talk about what happened just because people were so bullish on the potential of Mark Inu in to be able to fund manage AI 16z yeah I I believe they wanted exposure to um what Shaw and his team were building and and trying to kind of like uh gauge whether decentralizing building AI agents and managing AI agents uh was better than the traditional form of creating agents where they might need to just you know interact through apis with the

traditional World well maybe a decentralized approach might be better so there was a lot of different reasons why you would want kind of exposure to ai6 Z but what you just described was the main one okay the Eliza framework why is it called Eliza it's called Eliza because well it's actually a reference to uh one of the earliest forms of autonomous agents I think it was back in 1985 and you know it was obviously it looked very different back then but it it it gathered a term called Eliza I can't remember the exact acronym it was

something specific behind machine learning and an agent specific specifically but um kind of sha appropriated that um with his own framework called Eliza as kind of like a nod to to the Past okay so AI lore correct yes and the idea here it Li a framework for people who de developers who just want to make their own AI agent it's just open source software for them to download that's why it's the number two trending on GitHub is that the story behind that yeah think of it as like a software development kit for any new

developer that wants to spin up an agent it makes their life easier rather than kind of like figuring out what the raw code uh is for most of these things it can just kind of like look at this repository uh still have the ability to creatively Express what their agent is going to be but with the tooling to be able to allow their agent to do some of the basic things like create a Twitter account and post on Twitter or engage in Discord or create music whatever that might be I think they just like launched a Tik Tok integration as well recently

so you know it's growing pretty rapidly yeah um so let's get into what happened this week then right so um we we have ai 16z kind of like rise up in the rankings and become this darling child um and then literally over the last week um there's been kind of two dramatic events which have caused its market cap to plummet to almost like $150 million Market cap or maybe just below that um and the reason behind that is well let's walk through the events so event number

one is as we mentioned there's this framework called Eliza and the way that this whole AI 16z model works is um Shaw and his team encourages any team to build on their framework it's open source so they're saying hey if you want to come into this space and build an agent go for it Fork the code do whatever you want if you want to improve the framework submit um you know a request we'll accept it uh review and accept it and you know it becomes better Rising tide lifts all boats or whatever

the phrase is right um so as a result of that loads of teams have um developed their own agents and what people have done um in return for that is theyve donated a portion of their agents tokens to the ai6 z d fund but emphasis on the term donation so they're not required to but they do it out of like kind of like a nod to you know using the tooling and the framework and saying hey this is great okay so Eliza very bullish for AI

very very very bullish right um and you can see the reason why um a few people you know or many people have invested um in the token um but anyway so this Eliza framework kind of gained a lot of law right you know Eliza was being talked about here and there on Twitter um on mainstream media as well on GitHub and in a bunch of like uh research communities outside of crypto as well saying wow this this framework is pretty amazing so it kind of gained its own branding David and as you know within crypto anything that gains a bunch of

branding people want to create some kind of a meme or a token behind it right so Shaw went on publicly on X like a couple weeks back and said hey I just want to let everyone know that if anyone anyone wants to create an Eliza token and and to be clear here this Eliza token doesn't represent the framework the frame is open source it's ties exactly the framework is irrelevant its most uh potent connection is with ai6 Z token so he's talking about

something completely different which is like if anyone wants to create an Eliza agent or whatever that might be to build on the lore of Eliza you can go for it like I'm not going to have any of my hands in it you guys do it I'm not involved okay and he said that about two weeks ago um then at the end of last week what happened is a team released a token called Eliza right so precisely what he said he was like Hey if you guys want to do it go ahead a team released Eliza and it shot up to like I don't