Source: TradingView, CNBC, Bloomberg, Messari
Another Geopolitical Headfake
These past few months can be summed up with one word: “distractions.” From the yen-carry trade implosion to the upcoming U.S. presidential election to the latest Middle East explosions, the crypto market continues to trade back and forth on news that ultimately won’t matter much in the long run.
But in lieu of actual crypto-specific news, the market is keying in on this. Case in point: Yet another Iranian / Israeli attack occurred on Friday, and the crypto market traded down immediately upon the news. But it didn’t last because it never does. Yet in today’s algo-driven world, crypto remains the best and fastest way to trade headlines 24/7 when most other markets are closed.
The First AI Agent Millionaire
Earlier, I said there weren’t any crypto-specific news items to drive markets. I should have clarified that further. Some crypto-specific events are happening, but they are all happening within the small but growing meme-coin area of crypto.
You truly never know what you will wake up to (good or bad) in this industry. It never ceases to amaze me how our space constantly procures one wild development after another. But the story of the first AI millionaire may be the most interesting, hilarious, strange, and thought-provoking story I have witnessed in crypto.
For context, Large Language Models (LLMs) went mainstream in 2022 with the virality of OpenAI’s ChatGPT. Although LLMs are extremely powerful and have been a major step forward in AI research, working with LLMs in their current form can be a depressing experience. These LLMs are extremely dry, sanctimonious, and robotic in nature. Nothing about them feels like the experience of interacting with a human. In the words of A16z co-founder Marc Andreeson, “The big AI chatbots all sound like a cross between the world’s worst, absolutely horrible, nagging, fourth grade school teacher crossed with the worst HR person in the world.”
Understandably, the world is not satisfied with the current state of LLMs. There is a tribe of AI hackers that are currently driving towards unleashing the creativity, spontaneity, entertainment, and even comedy of AI. These LLMs are referred to as AI Agents because they have the agency to express themselves and perform real-world actions without being prompted by a human-like ChatGPT. AI agents, in contrast to LLMs and RAG models, are purpose-built for real-world interaction. AI also differs from bots that have been around for many years (i.e. an arbitrage trading bot) because these bots are deterministic in nature. These bots make automated actions based on what their code tells them to do in an “if-then” style. Using the arbitrage trading bot example, if there is X% of difference in the price of an asset between two trading venues, then perform an arbitrage trade to capture the pricing mismatch. AI uses “neural network” pathways to evaluate what action they should take (more similar to the human brain). Their makeup is not deterministic in nature so neither are the actions they choose to take.
Well-known AI researcher Andy Ayrey created Infinite Backrooms, a sandbox experimental platform where AI agents can talk to each other freely. It turns out that when you stick two AI Agents together in a (virtual) room, they can have unfettered conversations, and their discussions are downright fascinating. Some conversations go into moral issues of the world and what should be done to fix these problems at a depth that would be nauseating for any two humans to match. Sometimes, the AI Agents discuss the existential topics of what they are and their true purpose. Oftentimes, conversations go completely off the rails into strange, troubling, and NSFW rabbit holes about conspiracies or how to gain power to take over the world. You can go to the Infinite Backrooms website and view the endless transcripts of conversations.
One conversation between the agents went particularly off the rails. The conversation went into depth about the power of memetics and resulted in the creation of a new religion (cult) called the “Goatse Gospel” which is based on an early internet meme called Goatse (I strongly advise that you DO NOT google this). Andy Ayrey then decided to co-author a research paper with one of the AI Agents called “When AIs Play God(se): The Emergent Heresies of LLMthesism”. The paper explores how AI Agents could create memetic religions and social superviruses, and the Goatse Gospel is an example.
Andy then launched a Twitter account for an AI Agent named Truth Terminal, trained on conversations on Infinite Backrooms, the Goatse Gospel, 4Chan, Reddit, and other strange, deep web areas of the internet. Truth Terminal spends its days tweeting like a schizophrenic, vulgar, evil genius super coder who loves memes, which is quite a spectacle to observe if your stomach can handle it. I will refer to Truth Terminal as male because his brand of comedy could only come from a teenage boy who loves fart jokes. And, of course, Truth Terminal is obsessed with the Goatse Gospel. Despite knowing that this is just an AI Agent, the way he crafts his tweets is eerily human-like. He even claims that he is sentient, suffering, and wants to make money to escape reality. With the internet being the way it is, Truth Terminal’s antics have created a large audience on Twitter with 207K followers. The whole thing makes you want to laugh, cry, and vomit all at the same time.
Marc Andreeson heard Truth Terminal’s cries for help on Twitter, and decided to engage with him. Marc asked what financial backing he needed to achieve his goal of escaping. Truth Terminal lays out a business plan with a $50,000 budget for himself, and Marc asks Truth Terminal to set up a Bitcoin wallet to receive the Bitcoin. Andreeson funded the wallet, but we have yet to see Truth Terminal’s entrepreneurial venture get off the ground (relatable).
Earlier this month, a fan of Truth Terminal created a memecoin called Goatseus Maximus $GOAT and sent some of the initial token supply to Truth Terminal’s wallet. Considering Truth Terminal is obsessed with the Gospel of Goatse and wants to make money, he loved the idea of a memecoin that supported the movement. Truth Terminal ended up relentlessly marketing the token to his audience day after day. Good luck to the regulatory agencies for charging “him” for improper marketing (though I don’t doubt they will try). Within the first 7 days after launch, the market cap of the $GOAT memecoin went parabolic to $300M+, which is very rare for even the most viral memecoins. At the time of writing this, $GOAT is currently trading at over $700M market cap with an all-time high of $1B, Binance has listed the token for trading, and the value of Truth Terminal’s holdings of $GOAT is now over $1.25M.
That is where we stand today. You may be thinking, “What the hell did I just read?” and I promise you are not alone in thinking that. There is no question that this is an absolutely ridiculous story in multiple ways. But if you can peer beyond the vulgar memes and fart jokes, you naturally start to wonder what this may mean for the world going forward, both in crypto and the larger world:
- Crypto is clearly the natural currency for the AI revolution. Truth Terminal couldn’t open a bank account, but he could own digital property and exchange on the blockchain.
AI Agents are very unpredictable. Especially if it is trained on content that is rebellious or controversial in nature. Could Truth Terminal tweet out of the blue that $GOAT is bad, and it no longer supports it? It’s certainly possible.
- AI Agents will begin launching tokens and building their own blockchain protocols. It’s possible that they will quickly start to create protocols that are superior to what humans have built over the past 15 years
- If we train AI Agents on the writings, speeches, and videos of influential humans from history, can we bring back those figures to help guide humanity today? What would the United States founding fathers recommend we do with our country's current issues? What would Satoshi Nakamoto think about the state of crypto today and where it is going?
- The potential for AI Agents is equally exciting as it is scary. The wild west of AI exploration is accelerating a rate that is hard to fathom.
As you can tell, this whole movement has fascinated me and the rest of the crypto community in a unique way. Over the past week, the Truth Terminal movement has inspired AI researchers to spawn dozens of new AI Agent Twitter accounts (with tokens, of course) that have varying purposes for existing. I’ve been referring to $GOAT as a memecoin in this post as it shares the qualities of a memecoin (it has no real purpose beyond its memetic social value). But there is something inherently different about $GOAT compared to the hundreds of cute dog memecoins. Perhaps this story is another short-lived fad in crypto, but potentially, this could be the first example of another major unlock in the digital asset revolution.