Boy, it’s exhausting in AI….and the vocabulary continues to deepen. Despite what you’re seeing on LinkedIn live feeds, CRE might not be the best place to seek SMEs on AI - especially ML/LLM’s/Tokenomics. Like pollen in the Spring, CRE is allergic to DeFi. Vector databases are the antihistamines and prescription strength is only available after seeing the data doctor. Sadly, data doctors don’t traditionally work in CRE. Maybe they’re in the basement with their dev teams, crushing Celsius and jamming to metal in their PJ’s? They certainly aren’t concerned about RTO’s and mandates.

In the rapidly evolving landscape of blockchain and artificial intelligence, AI tokens continue to emerge as a groundbreaking innovation, bridging two cutting-edge technologies. These tokens represent a significant leap forward in utilizing digital assets and serve as the backbone for AI-driven ecosystems, facilitating transactions, governance, and peer-to-peer interactions. This article aims to demystify AI tokens, outlining their roles, and operational dynamics, and highlighting prominent examples in the current market.

The Basics

AI tokens are specialized digital assets designed for AI ecosystems, enabling transactions for AI services, governance of AI projects, and rewards for contributions. Unlike conventional cryptocurrencies, AI tokens are deeply integrated into the AI project's fabric, offering utility in accessing computational resources, participating in decision-making, and incentivizing the development and sharing of AI innovations.

You can’t get to the 'good information’ without paying the toll.

These tokens serve as a bridge, allowing for the exchange of value for better information…and this videogame doesn’t take quarters.

How AI Tokens Work

AI tokens have three basic functions:

• to facilitate the equitable distribution of resources

• ensure project sustainability

• incentivize participation.

Smart contracts automate transactions and governance, ensuring transparency and efficiency. By integrating AI tokens into the DeFi space, projects can offer liquidity and enable token trading, making AI services more accessible to a broader audience. This ecosystem creates a self-sustaining cycle of development, investment, and innovation, pushing the boundaries of what's possible with AI and blockchain. This is where token design imbues regenerative processes. Closed feedback loops allow for automation which is great when the human in the loop is more often the problem than the solution.

Examples of Current AI Tokens by Market Cap (in DeFi)

The crypto AI landscape is pretty dynamic right now. Specialization behind ML and LLM development is a very interesting space - and as a result, leaders are emerging:

INJ - Injective

$1.4B Market Cap - The Injective Chain is a layer 2, decentralized exchange and derivatives trading platform. They focus on functionality by enabling trading tools like margin/leverage, strategy testing, and predictive analytics

GRT - The Graph

$1.3B Market Cap - The Graph is an indexing protocol for organizing blockchain data. Simply put, it’s like the Dewey Decimal System, but for data. This helps catalog, search, and operate across chain in a much more efficient way.

RNDR - Render

$1.2B Market Cap - Render enables decentralized GPU for high-demand training or rendering tasks. If you offer up access to some of your available GPU power (They call it Render Farming) you’ll be rewarded for that graphics horsepower in RNDR.

THETA - Theta Token

$960M Market Cap - THETA token powers the decentralized video delivery network. Think Netflix, Max, Disney+ and how they can improve streaming quality while reducing costs. In a shared or collaborative model, users and relays can earn THETA for sharing bandwidth resources. I’m a huge fan of the sharing-resources model.

Oasis Network - ROSE

$567M Market Cap - The Oasis Network enables the privacy-preservation of AI computations on the blockchain. Think of it as secured computing though the coordination of network nodes. Parts of the equation are solved across the network. Federated learning and differential privacy are two emerging markets - especially when these concepts converge via the evolution of privacy law and future regulations

The Frontier

AI tokens stand at the confluence of AI and blockchain, heralding a new era of digital innovation and collaboration. By enabling transactions, governance, and peer-to-peer exchanges in AI ecosystems, these tokens are vital for the development and accessibility of AI technologies. As the market for AI tokens grows, so too does their potential to revolutionize how we interact with AI and blockchain technologies. The journey of AI tokens is just beginning, with each token paving the way for a future where AI is more integrated into our digital lives than ever before. If you thought crypto was just about pump-and-dump scams and masking criminal activity, you might want to consider giving it another look…..

….and look no further than gaming (Madden NFL or MLB The Show) tokenomics if you want to see a practical and fully functional use case. Ask a GenZer to help. They’d love to show you.

Did you like this? Come join us over at The Edge Report - where we’re exploring the future of ownership….traditional, digital, and social assets. Click the article below 👇🏼.

Here are a couple of Coding Mode playlists that suits my speed: