I bought more AI x Crypto crossover tokens this week. There’s a new wave of (mostly) autonomous agents driving massive pumps in memecoins. I think there’s a lot more to come.

These AIs are able to interact with humans and robots alike on social media (they’re popping up left and right on Twitter and TikTok). They support not just text, but also 3D avatars that can be ported between gaming worlds, social media, and anywhere else.

And most interestingly, they can transact on-chain.

A few weeks ago, Marc Andreessen gave $50,000 in Bitcoin to an AI bot known as Truth Terminal as an experimental grant. Truth Terminal, designed by AI researcher Andy Ayrey, quickly gained attention for promoting “memetic religions” and an esoteric concept it called the “GOAT singularity.” AI is weird sometimes ¯\_(ツ)_/¯ .

This idea of a meme religion around goats led the bot to endorse a new memecoin, $GOAT, it found on Pump.Fun.

Truth Terminal began posting left and right about the token on Twitter, which of course went viral and sent the coin’s market cap from ~$5,000 to over $850 million in days. It’s trading around $650 million as I write this today.

Not a bad two weeks, I don’t care who you are.

I missed the moment on $GOAT, but I dont think this will be the last time that an AI controlled bot will generate outsized opportunity.

Market Vibes

Crypto Reads

US Government Hacked for $20 million: An Ethereum wallet controlled by the U.S. government appears to have been hacked. On Oct. 24, Arkham, an on-chain intelligence platform, flagged that $20 million worth of USDC, aUSDC, USDT, and ETH was “suspiciously” transferred from a wallet linked to the U.S. government.

Kamala Harris’s Team Is Considering These Candidates to Replace SEC Chair Gary Gensler: The Harris transition team is vetting candidates to replace Gary Gensler as Chair of the Securities Exchange Commission (SEC), according to two sources close to the deliberations. Unchained has learned of two potential replacements, Georgetown Law professor Chris Brummer and Chair of the Public Company Accounting Oversight Board (PCAOB) Erica Williams, who are said to have more favorable views on crypto than Gensler.

Write and Write-Nots: …writing is thinking. In fact there's a kind of thinking that can only be done by writing. You can't make this point better than Leslie Lamport did: If you're thinking without writing, you only think you're thinking.

The ai x crypto narrative just got interesting

My first bet on AI was in stocks. I bought GOOGL and META soon after the ChatGPT release. GPT4 was (and is) literal magic. If you don’t have AI exposure, stop reading this right now and go find some. I’m not kidding. Have you tried using these tools recently? M-A-G-I-C.

I liked Google at the time because they were rich with TPU chips designed specifically for AI use cases — in a world with bottlenecked supply of GPUs from Nvidia and TSMC, I thought Google’s surplus of chips would give them a big advantage.

Meta was sitting on the best distribution platform for gen ML in the world. Instagram et al are such obviously good fits for creators and marketers to use ML to create actual value. My thesis was that no one else was better positioned to serve AI to the masses and be the top of the value chain to capture all the $$$ than Zaddy Zuck and Meta.

I didn’t buy the other obvious choices at the time, NVIDIA and MSFT, because 1) their prices were already crazy high from the initial GPT4 pump, and 2) I already have a very large equity allocation to the Nasdaq through QQQ which includes a lot of them both. I figured that was exposure enough given the prices at the time.

In retrospect, I should have dumped the GOOGL and bought NVIDIA!!!

Investing in ai via crypto tokens

My tactics on the crypto x ai side were similarly motivated. There are a lot of scams and narrative-based pump and dumps out there, so I wanted to only invest in protocols that actually made sense from a traditional business planning sense. I wanted to favor opportunities on AI infrastructure and distribution.

I’ve written about my first pick, Akash Network ($AKT), who uses crypto to coordinate a decentralized marketplace for compute, storage, and more (including GPUs). Real business, selling access to in-demand infrastructure. Makes sense enough.

Bittensor ($TAO) is another example with a similar-ish business model, and the TAO token has some memetic effects too — it’s the most widely associated single token with the “who is doing AI on crypto rails” narrative. I do not own any TAO, but i’m inching closer to a buy every week.

TAO and AKT were the only decent choices I could find, both on the infrastructure side. There wasn’t an obvious distribution play.

Until now.

A new revolution in ai x crypto

The first wave of the AI revolution was driven by breakthru in the foundational models themselves. OpenAI changed the world, and capital immediately accumulated at the handful of players on the bleeding edge of AI research.

The infrastructure must be in place before the tech can proliferate into all the nooks and crannies of everyday life. Makes sense. We needed the grid so that every house could have electric lights. We needed Cisco et al of the dot com bubble before high speed internet, and we needed cell phones with web access before Web2.0 could birth social media as we know it today. Telecommunications networks, railroads, the list goes on and on. Infra usually comes first.

What Truth Terminal and the GOAT pump have shown me, is that the infra is in place and autonomous agents are here. Like, today. They’re here right now.

Social media is the distribution, as I posited with my Meta investment, but it’s not just the social media platforms themselves. It’s the accounts and personalities (and bots) too.

And with AI Agents running these personalities, we can invest in them thru their tokens.

Social commerce → degen robots

Social commerce, particularly on TikTok, is the hottest topic in e-commerce right now and for good reason. Check out some of the numbers Shopify is projecting here. It’s wild how big this has become and how fast it continues to grow.

I see a strong connection between the rise of social commerce and the proliferation of AI agents on blockchains.

Brands borrow an audience from influencers/creators/celebrities to take distribution directly to the customer. There’s an existing trust between the buyer and the influencer, which creates higher conversion rates and more sales for the brand. It’s word of mouth distribution, with scale.

This isn’t a new idea. Affiliate marketing has been a thing forever. But it has always been constrained by the number and quality of celebrities or influencers. Brands have to find the influencer that fits their target market.

With ai robots, the brands can create the influencer themselves. Every brand can. And not just one. They can create hundreds (thousands? millions?) of bots that personalize and target to unprecedented granularity. Instead of paying affiliates 10-30% of every sale, why not create your own bot and own the audience without the marginal cost on every sale!

The tech just needs to be good enough to work. The bots must be entertaining and enjoyable and ethical.

Assuming they are (which, I think there’s evidence enough that we’ve crossed that Rubicon), why wouldn’t a brand want a robot cruising social media on your behalf 24/7/365? Why wouldn’t it want that bot empowered to engage, incentivize, and grow a community? This tech is improving at an incredible rate. The bots today are the worst that that they’ll ever be. The tech is only getting better from here.

Crypto, and especially the degenerate side of the industry, run on narratives. Memes beget memes. We’ve now seen, in real life, the power an autonomous agent can have in creating a meme, directing a following to take action, and generating crazy pumps. GOAT went from $5,000 to $800 million in two weeks. Sit with that for a minute.

Shopify projects the global value of social commerce to exceed $2.9 trillion by 2026. You don’t think that autonomous, AI powered bots will have a role to play?

Bots with the judgement to incentivize behaviors that you want (like buying a product or participating in a meme)?

Bots with the ability to create and to inspire?

Bots with degen crypto tendencies? 😍 

Truth Terminal showed us that it’s possible. You better believe there will be more of this to come. This is the start of a Cambrian explosion.

Autonomous crypto agents, no code required

It’s easy enough for a software developer (or someone comfortable enough to use AI to write/read code) to throw together a simple app that connects an AI to crypto. Coinbase is even marketing around this capability with their APIs.

But writing code still kinda feels like a lot of work, right? It’s 2024 and these are intelligent robots. We shouldn’t need to write code, right!?!

That’s the pitch for the Virtuals Protocol, a protocol that allows anyone to create a fully autonomous bot with on-chain capabilities and a token out-of-the-box. Your virtuals bot can use a variety of LLMs under the hood to power its intelligence, it’s avatar, and even its voice.

Each Virtuals bot comes with integrations so the bot is ready to post to social media from the start. Your bot can dance on TikTok, post on various other socials, and even message directly on Telegram and others.

These are not your grandma’s robots.

You sign up, choose your LLM of choice for cognition, avatar, voice, etc, seed the liquidity pool for the token, and click Go. Just that simple.

The initial use case taking off with Virtuals is anime Waifu characters (welcome to crypto). Whatever floats your boat.

Here’s an example Virtuals bot. Meet Luna. The $LUNA token is, as I write, trading at a $180 million market cap.

Virtuals has a great chance to become the default launchpad for crypto-enabled bots across social media and gaming. They make it easy and fast to create your own bot, no matter if you’re a retail trader in the meme-coin trenches or a sophisticated gaming/entertainment studio.

Virtuals is a bet on ai x crypto distribution

I expect the AI x crypto hype to continue increasing for the foreseeable future, and the $VIRTUALS token is well positioned to see outsized gains as a result. It’s trading around a $500 million market cap today and the token is fully unlocked. With a little luck, Virtuals could end up peaking in the 10s of billions given the huge potential and hype.

I’ve had Virtuals on my list of possible investments for several weeks. Unfortunately, when I sat down to deep dive this week, the price immediately 5x’d over just 7 days. So I missed that big move up, which is super annoying. I should have bought a small bag earlier to force myself to do the work. Lesson learned.

I decided to buy some tokens this weekend anyway, even after that price move. I decided to ease in over a few small buys and avoid missing the opportunity entirely. I bought a bit more when the price dipped on Saturday. If the price drops further I plan to buy more and hold for the medium term.

Portfolio Update

I bought $VIRTUAL as discussed above with moderate size (I’m hoping to scale in a little more this week).

I also took a gamble on a few ultra-small cap AI bot’s with tokens. The only one that’s done ok so far is $FIJI.EXE (you can play with the bot on twitter or telegram: https://x.com/FijiWPC). This FIJI coin is very very very low cap and low liquidity. It’s gambling. I’m disclosing it for the ethical reasons only. This is not an endorsement or financial advice. Please don’t gamble on meme coins just because you saw some idiot write about them on the internet. This coin is probably going to $0.