DeFi: Morpheus launches network of decentralized AI agents, attracting $175MM in deposits within a week
Does decentralizing AI agents alter our trajectory, or are we still moving towards a dystopian future reminiscent of Neuromancer?
Today we highlight the following:
PROTOCOLS: Morpheus Launches Network Of Decentralized AI Agents, Attracting $175MM In Deposits Within A Week
CURATED UPDATES: Financial Institutions and Adoption; DeFi and Digital Assets; Blockchain Protocols; NFTs, DAOs and the Metaverse
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PROTOCOLS: Morpheus Launches Network Of Decentralized AI Agents, Attracting $175MM In Deposits Within A Week
AI development faces several challenges today. The computing bottleneck acts as a speed limit to development, while a lack of collaboration hinders progress due to the fact that much of the leading-edge research is happening within big tech companies, who do not like to share. These trends risk centralizing AI in the hands of a few companies like the old familiars… Microsoft and Google, which operate closed-source large language models (LLMs), profiting from consumer data and licensing fees. We are pleased to see that there is a growing interest in more transparent, open-source LLMs.
Morpheus offers a decentralized, open-source LLM alternative in the Web3 space. It introduces a peer-to-peer network of personal AIs, called Smart Agents, capable of executing Smart Contracts by utilizing a user's Web3 wallet for key management and transaction signing when interacting with Smart Agents. Trained on Web3 data, including blockchains, wallets, dApps, DAOs, and Smart Contracts, Morpheus incorporates the SmartContractRank algorithm to score and recommend the best Smart Contracts to users. For instance, users can instruct the Morpheus Smart Agent to stake a specific amount of $ETH, and the agent will suggest the staking protocols with the highest smart score, enabling users to stake their $ETH using their personal AI.
The concept of AI agents performing tasks on our behalf isn't a novel one. In fact, just a few days ago, OpenAI made an announcement about developing AI agent technology that can effectively take over your device and operate apps on your behalf. The question is, does decentralizing the AI agents alter our trajectory, or are we still moving toward a dystopian future reminiscent of Neuromancer? In other words, is decentralization enough to keep the AI tyrants at bay?
Morpheus stands apart from centralized platforms by allowing users to retain ownership of their personal data, minimizing the risks of leaks and attacks. Individuals will possess private keys controlling access to their data, prompts, and wallet. The data will be stored using the IPFS standard and the Filecoin network.
But Morpheus is not the only player. Nearly a year ago, we analyzed Fetch.ai's $40MM funding round. The platform functions as an autonomous machine-to-machine ecosystem, where agents serve as independent nodes directly interacting via Cosmos. These agents possess the ability to learn, predict, and transact autonomously on behalf of users. Also, in the past months, Bittensor (TAO) has gained significant popularity, with the TAO token surging over 10x to $600. We like the idea of Bittensor’s network allowing individuals to contribute to open-source AI and monetize their work, regardless of the size of their contributions. However, we are concerned that the project is perceived as a yield farm, with 90% of TAO staked. Perhaps this should raise the same questions about Morpheus's $60MM in stETH deposits within 12 hours - is this driven by speculation or genuine belief in the tech?
Autonalos, which focuses on decentralized, trust-minimized, and transparent AI agents, takes a different approach by placing more emphasis on the product as opposed to quick gains. See here for their whitepaper. Note that while tokens are indeed important incentives that motivate people to refine models and gather real-world data, we must tread carefully lest tokens become the primary focus rather than a byproduct.
Overall, the AI arms race, playing out between big centralized players raises significant questions related to data and privacy. In our long take, we mention that custody always leads to a principal/agent problem, where the agent has an incentive to steal from the principal. Web3 offers a counterweight to this danger through self-custody of information and AI agents. Advancements such as zero knowledge machine learning (zkML) enable smart contracts to securely query AI models without exposing the underlying data and parameters. In a world where multiple successful open-source models exist, and some are effectively run on decentralized infrastructure, we anticipate that crypto custody and control of AI agents will become a core value proposition of Web3.
👑 Related Coverage👑
Curated Updates
Here are the rest of the updates hitting our radar.
Financial Institutions and Adoption
⭐ Franklin Templeton Files For Ethereum ETF - The Defiant
Citibank Tests Tokenization Of Private Equity Funds On Avalanche - CoinDesk
US Treasury Will Outline Fears About Use Of Crypto In Illicit Finance At Upcoming Hearing - The Block
DeFi and Digital Assets
⭐ Starknet Token To Launch On February 20 - The Defiant
Ex-FTX US Exec Brett Harrison’s Startup Raises $12MM For Derivatives Brokerage - Blockworks
EigenLayer Amasses More Than 10% Of Circulating LSTs - The Defiant
Fordefi Secures $10MM Investment For Crypto Wallet-as-a-Service - Finextra
Arbitrum DEX Dolomite Launches On Polygon zkEVM - The Defiant
Blockchain Protocols
⭐ Polygon zkEVM Prover Reaches Type 1 Status - Blockworks
⭐ Analog Closes $16MM Funding For Cross-chain Communication Tools - Cointelegraph
Frax Launches Modular Layer 2 Blockchain - The Defiant
Citrea Brings ZK Rollups To Bitcoin - The Defiant
DN-404 Token Standard Launches To Improve On ERC-404 - The Defiant
NFTs, DAOs and the Metaverse
AI-Powered Gaming Platform Ultiverse Raised $4MM At $150MM Evaluation - Crypto Daily
CoW DAO Sets Up MEV-capturing AMM For Liquidity Providers - Blockworks
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