Permissionless III: Rise of the Machines
Agents, the election, and overwhelming graph neural networks
Hey folks! I’m back from Salt Lake City, ready to give my impressions of this year’s web3 Permissionless conference. The conference came at a great time; I had to evacuate from Orlando early last week because of Hurricane Milton, so I couldn’t have stayed anyways.
In this article, I’m going to give you a rundown of the conference by day, and highlight some of the projects that caught my attention and interest. Like other conferences this year, the convergence of the web3 x AI space is becoming a major topic, with the DeAI day really capturing a lot of attention. So, if new projects in the web3 space interest you, and you’re AI-curious, this post is worth a read. For full transparency, I went to promote and move Autonomys forward as a network ahead of the mainnet launch. Autonomys is a DeAI solution with a novel consensus. Learn more here.
Permissionless III is a major cryptocurrency conference, and this year it was held from October 9-11th in Salt Lake City, Utah. It was organized by Blockworks and Bankless, and included a 36-hour hackathon that was free for participation. Speakers I was excited to listen to included Balaji Srinivasan and Chris Dixon, both of whom have had extensive public speaking appearances this year. Unfortunately, I ended up missing both of their talks.
With that out of the way, let’s dig into it!
Arriving in Salt Lake City
As I mentioned a minute ago, I had to leave Orlando early to escape from Hurricane Milton. MCO airport shutdown the day after I left, and I had one of the last flights to SLC out of the city. The chaos in Orlando the day before was pretty wild – I was unable to get gasoline and had to come up with a plan B if I missed my flight. My plan was to drive to North Carolina and meet up with some friends. Fortunately, everything was fine. Damage in Orlando was relatively minor, and I came back to my rental house being intact aside from tree branches everywhere. In the moment, last week, leaving the city was scary and emotional given the projected impact on the state of Florida. I’m glad everything turned out to be much more mild.
I arrived in SLC on Tuesday evening, and ended up stumbling on Utah’s inaugural hockey season celebration downtown. I know absolutely nothing about Utah hockey, but I enjoyed walking to the Delta center, listening to a terrible DJ set for 10 minutes, and walking back to the hotel.
Day One Impressions
There were multiple side events happening in parallel during the week, albeit less than Token 2049 or other larger events. Most notably, Wednesday’s events included DeAI day and Safary’s marketing track. For the main stage and conference itself, many themes emerged during this conference:
Key Focus Areas
Modularity
Restaking
Gaming
Bitcoin
AI and crypto
NFTs
Layer-2 solutions
US Election and Policy
Multichain Future
Consumer applications
It was hard to ignore the reality of the November election, and regulation is on everyone’s minds. There’s a lot of uncertainty on how different election outcomes will impact crypto regulation. However, there is more of a consensus for clearer legislation over regulation to provide more stability and clarity. Crypto has trouble fitting into existing regulatory frameworks (e.g. crypto assets as securities vs commodities). That said, speakers tended to agree that the US falling behind in crypto regulation and losing a competitive edge isn’t ideal, and this technology will continue to progress regardless of who is at the wheel. Crypto is absolutely here to stay, and there were more talks about stablecoins at this conference than any other in recent memory.
The convention had a smaller area for booths compared to Consensus or ETHDenver this year, and the convention hall was, admittedly, pretty dead. One of the top sponsors this year was Illuvium, which really blew up in 2022. The project has come a long way since then, and looks more like a full-fledged AAA studio title. I enjoyed visiting the gaming lounge to see the setup (similar to something like PAX on a smaller scale) and snagging a few Kind bars. If anyone has played Illuvium, I’d be very curious to hear your experience!
DeAI Day and web3 x AI Projects
I spent most of the first day at DeAI day. The theme for this was the age of agents, and it was sponsored and presented by Morpheus, 6079, wire.network, and Exabits. These are some of the more promising and influential projects within the DeAI space. What they have in common is being members of the Independent AI Institute (IAI), which is proposing an open source industry standard for verification of AI inference on decentralized GPUs. Proof of Inference is being pioneered by 6079, and it is relevant because it addresses the challenge of verifying AI inference on decentralized hardware, ensuring the reliability and scalability of distributed AI systems through cryptoeconomic security mechanisms.
This begs the next question: why is decentralized AI (DeAI) even important? Is it not just a gimmick to utilize a gigantic solution looking for a problem? Simply put, in my opinion, DeAI will act as a necessary counter to centralized AI efforts, and crypto networks are uniquely qualified to facilitate more fair and robust AI systems. Bias could, in theory, be reduced if ownership and accountability is decentralized. IAI wants shared standards to make DePIN networks as competitive as possible when compared against centralized alternatives. To clarify: we are in the very early days of the DeAI space. I wasn’t even aware of this being an acronym until March of this year, and it wasn’t being thrown around at all during ETHDenver. DeAI OGs like SingularityNET supposedly coined the term, but it wasn’t until Bittensor this year that the term has enveloped the DePIN space.
Hopefully this provides some context for those of you who haven’t been following the space. As far as I can tell, it is the newest subsector of web3, and has a lot of crossover when people talk about web3 x AI. Not all usage of AI within the web3 space leads to decentralized solutions, but many projects have established that as a primary or secondary goal. For example, utilizing language models to make on-chain data more readable simply makes web3 more accessible.
Highlighting all of the talks during DeAI would easily be its own article (which I may write later this week) but to keep things simple, I’ll highlight three talks I really enjoyed.
Theoriq (Agent Use Cases)
Ron Bodkin, founder at Theoriq, gave a talk on agent use cases. Theoriq’s dashboard and setup has come a long way since this summer, and looks similar to Perplexity. Theoriq is marketed as a modular and composable AI agent base layer. As time goes on within the agent space, multi-agent systems (MAS) are growing in popularity and usage. Having an easy to use marketplace to buy, sell, and use specialized agents in a decentralized fashion is definitely desirable, and can lead to being able to ask questions and get responses with vastly richer context than a tool like ChatGPT.
Having an agent that can pull on-chain data, or be highly customized and access certain repositories, is a gamechanger. Think of this like Perplexity on steroids, decentralized. A MAS on a platform like this could be used to make better trades, or better, provide the necessary knowledge to allow for fully automated agents to make trades on your behalf. Bots have long been used within the crypto space, but having agentic frameworks that allow for longer context windows, speed, and information will eventually change the game completely. It is only a matter of time before MAS are used during and prior to all trades on crypto networks. Doing things manually will take longer.
This isn’t speculation. Nogas was also a sponsor of DeAI day, and they are building the first decentralized exchange for the nascent AI agent space, with the promise of universal chain compatibility, insane transaction speeds, and no gas fees. It is clear that the necessary bits and pieces of the DeAI space are being built now.
Wire Network
Wire Network was also a co-sponsor of DeAI day. Wire is currently marketing itself as the ‘only’ blockchain for the AI agent economy, with Nogas being a DEX that will be built on top of its network. Wire is trying to build a universal transaction layer for AI agents, and wants to make it easier and cheaper to do cross-chain operations within the space. Wire is also building an agent marketplace, and is also fully bought into the notion of the economy of the future being AI agent-based. Wire has a universal identity service called WNS, similar to ENS. Judging by Wire’s Discord and X presence, they’re just getting started on creating a community.
In nearly every case for projects and companies highlighted during DeAI day, building the infrastructure for agentic AI on-chain is top of mind. Having blockchain networks that can support the kind of throughput required will catapult us into the next generation of networks. Make some wallets for agents, give them some crypto to play around with, and see how they trade autonomously. This future is coming quicker than many have expected.
Pond (GNNs)
The last project I want to highlight from DeAI is Pond. Pond is building a decentralized Graph Neural Network (GNN) model for web3. As Bill Shi (CTO) explained during his talk, as something like a GNN is further developed, so will the ability to predict on-chain behavior. Web3 apps will be able to utilize Pond’s GNN model to predict user behavior, market trends, and on-chain events more accurately. It could be used to detect abnormal behavior, and potentially prevent scams or attacks.
Additionally, there’s the potential for usage in advanced trading and complex DeFi strategies. More sophisticated trading algorithms could be developed as a result, as well as better recommendations to users, targeted marketing, and anything else you can imagine applying AI. Pond wants to be the foundational model for AI in the web3 space. I think this project is absolutely worth following, and I’m excited to see where it goes. The value is definitely here.
Other Musings
The latter half of Thursday also consisted of AI panel discussions, which were in many regards less granular and more high-level for those new to the web3 x AI space. After a while, you reach a saturation point with a subject where you can glean only so many additional insights. The DeAI space is one of those for the moment. There are the core players, and core ideas. The hard part is watching and waiting for things to be built, ecosystems to be developed, and people to join in on the bandwagon. The physical infrastructure needs for AI have been widely discussed, and everybody and their mom is buying a nuclear reactor to power the next generation of data centers.
The other talks that really stuck out to me during the conference involved regulations, with the emphasis still being on regulatory clarity being needed, especially with ongoing debates about the classification and regulation of cryptocurrencies. Stablecoins are here to stay, with the current circulating supply of stablecoins being near their ATH. Transaction volume for stablecoins has remained steady, with USDC becoming increasingly preferred, given they are backed by US dollars or dollar-denominated assets like US treasury securities.
The conference was also great for networking. Akash Network hosted a great side event Thursday evening, and Scrib3 held a refreshing happy hour on Wednesday as well. It is hard to overstate this: you can pull just about anyone aside and you’ll find something in common. We’re all in the space because we like tech and cool stuff (at least that’s what keeps me around). One conversation led us to being on a podcast as a guest a couple days later! You never know who you’ll talk to.
Takeaways and Final Thoughts
Permissionless III was a business-focused, less degen-y conference, and that’s a good thing – it allows for more serious talks on regulations and a more sober and scrutinous view of where our multi-chain future is heading. Until the election happens next month, the future is open to speculation. However, many trends and key focus areas will remain at the forefront of the industry, like modularity, restaking, gaming, AI, L2s, consumer applications (mass adoption), and the roles of the CFTC and SEC in regulating crypto.
This is still a niche space, but it is growing. The average person isn’t tuned into the nuances of what is happening within this space, and it is still relatively small. AI is being embedded into everything. Stablecoins are here to stay, and have plenty of valid use-cases. The foreseeable future includes multiple chains. As AI expands, content provenance is sorely needed as we approach the deepfake-ification of everything. Crypto needs to proactively create the infrastructure to support aspects of the inevitable post-labor economy. The cheaper intelligence is, the more our world as we know it will change. Bitcoin may end up being the bridge between how we interact within the world today, and a post-scarcity economy. By the end of the decade, you may end up relying on a highly personalized AI to make sense of the blindingly fast-paced world.
The hurricane, and the potential destruction of the place I’ve enjoyed living gave me time to reflect last week. As technology and intelligence are automated, there is an urgent need to not just be more human, but to cherish humanity. We already live in an era of abundance, it just isn’t sufficiently distributed yet.
That’s it for this week. If you enjoyed this write-up, let me know. If you want to hear more about something, reach out.
- Chris