The Rise of Cybereconomic Smart Agents
Published by Kevin Denman on: August 6, 2024 | Read on Medium
The emergence of the cybereconomy began about 25 years ago when internet use began to evolve from a read-only medium to a read-write medium that could support an entirely new class of write-oriented use cases like ecommerce, blogs, and social networks. While it may seem to some like the cybereconomy is complete, builders in the crypto space have spent the last decade retooling the internet with digital ownership and cybereconomies at its very core.
In addition to providing humans with fundamentally new ways to participate in the cybereconomy, blockchain infrastructure will also spawn the rise of a new actor - the Cybereconomic Smart Agent.
Decentralized applications (dapps) and web3 protocols offer the perfect environment for AI agents to have the "agency" their name suggests. They provide AI agents a unique deployment environment that web2 simply cannot:
Permissionless Access: Web3's permissionless orientation means that anyone can participate. This also means that Smart Agents can be deployed on behalf of users without needing approval from a central authority so-long-as they abide by the rules of the protocol.
Web3 Wallets: Unlike in traditional fintech, Smart Agents in web3 can create and utilize a wallet, providing a secure, agent-controlled interface for managing assets and interacting seamlessly with protocols and dapps.
Transparent Protocols & Smart Contracts: The transparent and traceable nature of open source blockchain protocols ensures that Smart Agents operate within well-defined and predictable parameters.
Open Source Code: The open-source nature of crypto allows developers to create and customize Smart Agents freely using wallets, dapps, protocols, and LLMs. Smart Agents in an open source context will adapt, replicate, and evolve more freely than in a close source ecosystem preoccupied with shareholder value.
What are some compelling use cases?
In Vitalik's blogpost The promise and challenges of crypto + AI applications, he concludes that the immediate opportunity for AI in crypto is where AI is acting as the "player". Expanding on his “player” definition, there is no shortage of Smart Agent use cases that take on this player role in Web3:
DeFi Vaults: Smart agents can be integrated into DeFi vaults to work on behalf of the vault and, by extension, the liquidity providers (LPs). These agents can autonomously manage and optimize the vault's strategies, execute trades, and rebalance portfolios, maximizing returns while minimizing risk. For example, VaultCraft (formerly Popcorn) could add Smart Agents to their SDK enabling developers to seamlessly power their vault with the best Smart Agent available for their chosen protocol.
Gaming: Imagine an on-chain game inspired by "The Matrix." SmartAgent developers can deploy Agent Smiths that compete against humans in a nondeterministic gameplay mode. These agents could adapt and learn, providing a dynamic and challenging gaming experience that evolves over time with Smart Agents and humans.
Decentralized Physical Infrastructure (DePIN): Smart agents can be employed by DePIN compute providers to optimize their operations across multiple protocols. These agents could dynamically allocate resources, switch between different networks based on supply and demand, and ensure that infrastructure providers maximize their profits and efficiency. For example, Semiotic Labs of The Graph has developed an algorithm for indexers.
Beyond Smart Agents functioning as a “player” in Web3, the other most compelling frontier is Smart Agents functioning as an “interface”. David Johnston, one of the core contributors of Morpheus, describes the Smart Agent as the core LLM-enabled interface between humans and Web3 protocols.
How will the Smart Agents rise up?
The rise of Smart Agents will accelerate via a combination of building blocks emerging in the web3 ecosystem. These building blocks are hardly small, and consist of many well-funded projects with brilliant teams behind them:
Smart Agent Development Toolchains. Developer toolchains like Theoriq, Olas Protocol and Morpheus provide toolchains and frameworks for creating and deploying Smart Agents.
Foundational Models. Platforms like Sentient aim to provide crypto-native large language models (LLMs). These LLMs serve as foundational components, offering pre-trained models that can be fine-tuned for specific tasks within the blockchain ecosystem.
Training Data.Decentralized data markets such as The Graph and Filecoin offer access to diverse and high-quality Web3 datasets necessary for training LLMs that Smart Agents can utilize.
Compute Resources. Decentralized GPU compute markets, including Akash Network and Render Network provide the necessary compute for training and running Smart Agents. These platforms offer scalable and cost-effective access to GPU resources, enabling efficient model training and real-time inference.
Agent Interoperability. Solutions like Hyperlane, Cosmos (IBC), Polkadot (XCM), and Layer Zero offer cross-chain interoperability. Smart Agents will learn to use these rails to either interact with eachother or become cross-chain capable themselves.
The cybereconomy of the future will have Cybereconomic Smart Agents at its core
As we stand on the brink of this new era, it's worth reflecting on the predictions made in "The Sovereign Individual." The authors foresaw a future cyber economy characterized by the convergence of network states, cryptocurrency, and Smart Agents. This future is now rapidly approaching, with the integration of Smart Agents into the web3 landscape set to propel the cyber economy into a parabolic trajectory.
In conclusion, the rise of the crypto Smart Agent is not just a possibility; it is an inevitability. As developers harness the power of Smart Agent platforms and marketplaces, we will witness an unprecedented transformation in how decentralized applications operate, ultimately reshaping the digital economy.
Sources
- Davidson, J., & Rees-Mogg, W. (1997). Transcending locality: The emergence of the cybereconomy. In The Sovereign Individual: Mastering the Transition to the Information Age. Simon & Schuster.
- Buterin, V. (2024, January 30). The promise and challenges of crypto + AI applications. Vitalik Buterin's Blog.
- Johnston, D. (2023, May 26). Smart agent white paper. Medium.
- Investopedia. (n.d.). Web 2.0 vs. Web 3.0: What’s the difference? Investopedia. Retrieved August 6, 2024, from https://www.investopedia.com/web-20-web-30-5208698