AI has by far captured the highest mindshare within the crypto industry over the past few months.
While it may look like saturation, I like to think it’s more of an adaptation. With other crypto sectors like DeFi and NFTs taking a bit of a backseat while the world marvels at the innovation taking place in AI, it only makes sense that crypto x AI is the next natural frontier.
This sector has been discussed for a couple of years now, but things really hit the ground running in late 2023/early 2024.
The two most notable first movers in this space were Bittensor and Render. Render has been around for a long time, but its decentralized compute product perfectly suited the AI narrative, while Bittensor went head-first into AI with its blockchain built around the AI subnet architecture.
Fast-forward to October 2024, and these two took a backseat while AI agents went firmly into the driver's seat with the introduction of Truth Terminal. Truth Terminal was essentially an agent that would shitpost and post memes like any other CT account.
It rose to popularity after adopting GOAT, a coin that hit a market cap of $1 billion, and Fartcoin, the memecoin that currently has a $1.2 billion market cap.
Since then, however, the landscape has evolved.
People started making task-specific agents. For example, agents focused on analyzing charts and posting the analysis to X came into mainstream existence. Then, agents were designed to scan tickers and identify whether they were scams or not. Alongside came the AIXBT-style agents that simply aggregated information and gave breakdowns of coins — an AI KOL of sorts, but better than your average CT KOL.
But all of this is ultimately rudimentary. It’s AI in its simplest form.
The infrastructure projects took things to the next level. They built out entire frameworks that made it easy for developers to create crypto-native agents and other AI products. Popular examples include Eliza (by ai16z), ZerePy (by Zerebro founders), Arc, and Rei.
Beyond this, there are also swarm projects like FXN, which allow multiple AI agents to interact and communicate with one another seamlessly, creating an AI agent ecosystem of sorts.
More recently, AI has been combined with DeFi to make DeFAI. These are AI agents that automate on-chain activities — so things like making trades, farming yield, or providing liquidity can all be automated and handled by an AI agent.
Everything described above is great, but there’s one caveat — right now, the activity is limited to Solana and Base.
While there’s nothing wrong with being on these chains, we believe there are majorly overlooked opportunities elsewhere that are not talked about nearly enough.
The biggest one is Sophon.
Why AI on Sophon?
First and foremost, if you don’t know what Sophon is, check out our previous article.
For the context of this article, it’s important to know that Sophon isn’t just an ordinary layer-2 [L2]. It’s an L2 with a very specific focus: consumer crypto.
Consumer crypto boils down to products that use blockchain technology to enhance the online user experience of existing consumers. The focus is very much on the masses instead of crypto-native applications.
Harnessing crypto's transparent and permissionless nature, the fact that it’s the first truly digital-native form of money, and combining it with popular online experiences is a great recipe for bringing the masses on-chain.
This is exactly where Sophon’s edge lies within the AI narrative.
The crypto AI agent stuff, along with the infrastructure frameworks, is really good and necessary, but ultimately, AI teams are going to care about one thing: reaching as many people as possible. The more niche a product is, the lower its reach.
Therefore, being a consumer-focused chain, AI teams have the perfect platform to deploy AI products that touch maximum consumer endpoints.
Gaming is already a big part of Sophon. For example, Petopia, a fun mobile rogue-lite shooter, recently crossed 100,000+ matches and 1.2 million+ transactions in the game shop. So yeah, it has a massive player base.
Now, imagine an AI gaming solution. This could be a product that populates games with AI characters or builds AI assistants to help users navigate through games. Given the user base, Sophon is a great candidate for devs when deciding where to deploy.
Even if we boil it down to something simpler, like buying items, a platform on Sophon can allow customers to create different types of agents to automate these tasks for them.
For instance, imagine a company does an exclusive drop of an item on Sophon — the agent can be configured to automatically buy it even though the user isn’t on their device.
The natural evolution of AI will eventually lead to making consumer-focused products and the general life of consumers online easier. With Sophon already having a head start in consumer crypto, it only makes sense that AI products that want a head start in consumer AI launch on Sophon.
The $5 million Sophon Intelligence Academy (SIA) initiative will play a major role in this. In essence, the Sophon team, along with their partners, will be allocating capital to help different AI teams build out the agent ecosystem on Sophon.
With that as the backdrop, let’s dive into what the AI ecosystem looks like on Sophon right now.
The current AI landscape on Sophon
Cod3x
Cod3x is a platform that aims to evolve the DeFi landscape through agentic interfaces. It will fall under the DeFAI category, which you might have heard spoken about across the industry quite a bit recently.
The idea is to allow anybody to create an agent that will simplify DeFi tasks like trading, providing liquidity, coming up with yield farming strategies, and so on into simple natural language commands made to an agent.
Simply tell the agent to buy XYZ coin at a given price, and the agent will do it for you.
The grander vision with Cod3x is to create a form of swarm intelligence amongst all the various agents where they collectively grow smarter and better through interactions with one another.
Ultimately, this will contribute to the creation of a self-sustaining economy of AI agents, where the value generated by the agents will end up covering the cost of operating them and even generate a profit for users.
Cod3x will play a central role in the Sophon ecosystem and the SIA program. Cod3x and Sophon have partnered to create a $1.5 million campaign (under SIA) called Sophon Spark.
As the name suggests, this campaign will help spark the agentic economy on Sophon. The $1.5 million will be used for:
- Strategic liquidity incentives
- Native lending platform integrations
- Token launchpad for AI projects
- Monthly competitions to attract and reward AI agent developers
Anomaly
Anomaly created Nova, which is something of a magical agent. Nova is an agentic world builder that operates in the realms of AI gaming, trading, and social interactions.
Through Anomaly and Nova, Sophon users will be able to create agents in all of these categories to fulfill their specific needs. By design, these agents will continuously evolve and improve themselves through real-world interactions.
Nova has already attracted significant attention. It was the first AI agent on Reddit, where the Nova’s Scenarios game was launched. To date, this storytelling game has amassed close to 10k unique players.
Beyond this, there are a bunch of other key features that Nova will bring to amplify the agentic economy of Sophon:
- AI agent launchpad - A launchpad that is set to host over 10,000 agents that will continuously evolve through gaming, trading, and social interactions.
- Trading integrations - Provide users with real-time market research and information while also automatically executing trades.
- GameFAI - Agents built through Nova will be able to understand game mechanics, which will make AI characters in games much more sophisticated.
- SocialFAI - Nova agents will be able to engage in social interactions. An example is the Nova AI Podcast, where Nova interviews different founders and innovators in the AI space.
All of this is coming to Sophon, where the project will also tokenize its AI platform. So yeah, it's pretty massive.
ScorePlay
ScorePlay is a prediction platform that may finally make you profitable for once in your life.
We all know how big sports betting has become as an industry. Online casinos have massively ramped up interest from the younger generation in sports betting.
But despite everyone thinking they have the script and that their bet is a lock, the last leg of the parlay gets them.
Rather than constantly losing money, you can use ScorePlay.
ScorePlay is an AI-driven sports prediction market. Its peer-to-peer platform currently offers 85% lower fees than its competitors and a variety of tools for users to develop their strategies.
In the near future, the platform will feature AI agents focused on sports betting. These agents will provide users with insights, strategy, and automated bet execution.
The platform's success is undeniable. It has 10,000+ testnet users and a 68% user retention rate. All of this will soon be coming to Sophon.
Pretty impressive, right?
SPHNX
SPHNX is a clever cat. It’s a challenge-based game that operates through an AI LLM.
The name of the game is simple: players have to use text-based prompts when communicating with the game’s agent to make it say a forbidden word. The word changes after someone successfully makes SPHNX say it, but it isn’t easy.
If you succeed in making the bot say the forbidden word, you can win up to 70% of the reward pool.
However, the bigger picture with SPHNX is that it helps advance AI privacy research.
As more users compete, doing their best to jailbreak the bot, a lot of data is collected about how AI agents process sensitive information and handle data privacy under pressure.
This allows developers to identify vulnerabilities in LLMs and, therefore, make them even more sophisticated than they are at present.
Aethir
Aethir is less consumer-facing but still an incredibly important part of the AI puzzle.
For AI models to be successful, they need data: a shit ton of data. To process all of it, they need access to compute power, which is expensive and often difficult to source, especially for AI developers who are not well-capitalized.
Aethir is an infrastructure solution that offers compute on demand through a GPU marketplace where people can trade compute power.
This will ultimately act as the backbone for AI on Sophon because anybody looking to build AI products will already have access to a top-notch resource they can tap into for compute power.
Yet another reason why Sophon should be at the top of your list of considerations if you’re an AI developer.
Looking ahead
Okay, so now you know what currently exists on Sophon and what’s coming up. So, we thought it would be an interesting thought experiment to discuss what we think would be good to see launched on Sophon.
- Sophon assistant
As a consumer crypto chain, Sophon offers a wide range of products. Additionally, the target audience goes beyond crypto-natives who are already very familiar with navigating a blockchain.
Something we think would be cool to see is a Sophon AI assistant.
An example of what this could look like is an AI agent linked to a wallet. A user can simply type what they desire, like “I would like to place a bet on tonight's football game.” The AI assistant will then direct them to the best betting platforms on Sophon, making the process much smoother.
Take it a step further, and the AI assistant could even be the interface through which users execute their transactions. It would be a major enhancement in user experience.
- Gaming x AI
As mentioned earlier, gaming will play a huge role in the Sophon ecosystem.
They have partnered with top-tier gaming publishers to launch top-tier games, which means there will already be a large existing gamer base. Eventually, AI will make its way into gaming, and for crypto projects working within AI gaming, Sophon is the best place to be.
A gaming navigation assistant would be cool. It could take you through the different games and give you a rundown on how they work and how to play them.
Something else that should be implemented is AI characters within games. When playing against NPCs, they are much more interactive and can adapt to different game scenarios, making the overall gaming experience much more enjoyable.
- DeFAI
We know most of you are probably tired of hearing about this sector, but I believe it is best suited for Sophon.
Yes, Sophon is a consumer-focused chain, but that doesn’t mean there will be no crypto-native apps at all. What it does mean is that there will be a good chunk of users on Sophon who could potentially benefit from DeFi applications but may not be savvy enough to use them.
DeFAI products will prove to be the best solution. Users simply have to use the AI tools to perform different on-chain tasks on Sophon, and they can start earning with relative ease.
- SocialFAI
SocialFi as a sector has always had fleeting moments of attention within our industry, but it will eventually play an important role at some point in the future.
When you combine SocialFi with AI, that future starts to look a little easier to grasp.
SocialFAI refers to AI agents that can take part in a variety of social interactions and constantly adapt and improve as they engage in more real-world interactions.
This could be an agent that runs a research-driven crypto Twitter account, an agent that just posts memes, or even one that runs their own podcast and hosts a variety of different guests (kinda like Nova).
SocialFAI is likely to be a major category going forward, and given Sophon’s consumer-oriented approach, a sector like this fits perfectly into their ethos. Nova might just be the first in a series of SocialFAI dominos that we may see on Sophon.
Closing thoughts
In all, we believe Sophon has somewhat of a blue ocean play within the crypto x AI field.
There’s no question that the entire sector will grow massively from here on out, but Sophon, being positioned as a consumer chain, tackles a completely different audience, and arguably a much wider one than any other chain.
We believe AI on Sophon will be much more useful as a consumer-facing solution product than anywhere else, and the potential for different types of AI products to deploy on Sophon, especially with its underlying architecture, is virtually endless.
While we know everyone and their mother is trying to hop on the AI bandwagon, the way Sophon is positioned — it actually fits perfectly.
I think AI on Sophon is a massively underrated opportunity and you should definitely keep your eyes on it.
Valhalla awaits.
