⚡Has Crypto found its destiny with decentralized AI?
Plus Ordinals volume, gaming crypto resurgence, and more
The Dynamo DeFi newsletter covers trends, on-chain analysis and tools in crypto each week.
📈Trends and Narratives
Has Crypto Found its Destiny with Decentralized AI?
The tech news that everyone’s been talking about is the OpenAI board’s ousting of Sam Altman, who was quickly hired by Microsoft to lead a new AI division.
While not crypto news on its face, this move by a group of less than 5 people to slow down AI progress has sparked discussion about the need for decentralized AI. Balaji laid out what they could look like in this thread:
This feels like a pivotal moment. There’s a future where we look back in retrospect at the past decade of development in blockchain tech as the prelude to its use-case in building a broadly accessible AI infrastructure. Digital money makes more sense when you have digital minds.
Unsurprisingly, talks of decentralizing AI have refocused attention on AI-related crypto projects. As I see it, there are 4 main points of synergy between AI and blockchain:
Decentralized data storage and computation networks, such as Arweave, Filecoin, Render and Akash
Peer-to-peer markets for AI models and training data for AI models
On-chain verification that videos are real (and not deep faked)
Value storage and transfer for autonomous agents
One project that’s been especially interesting to me has been Bittensor, whose TAO token has been on an absolute tear recently. Bittensor is a decentralized network for incentivizing and collaborating on AI models. This longform post is an incredible starting point to learn about Bittensor:
Gaming Crypto Resurgence
Another top performing sector recently has been gaming related cryptos. While it's grown recently, this sector is still relatively small with a total market cap of around $12 Billion. I view this as a potential powerful driver of crypto adoption for a few reasons:
In-game assets are already widely paid for. Tokenization provides a clear value proposition by allowing them to be used across multiple games or applications.
There’s huge overlap between crypto users and gamers already.
A “digital asset” makes more sense in a digital world.
One game I’ve been watching for awhile (but unfortunately didn’t invest in) is Parallel. Parallel is a sci-fi based trading card game and were recently approved for release in the Epic Games store. What first interested me in Parallel was that I noticed people playing it for fun, a rare trait in a crypto game.
Even more interesting, Parallel is also incorporating AI and autonomous agents. This thread by Bankless dives into how Parallel synthesizes AI, gaming, and crypto:
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🔢On-Chain Analysis
Ordinals Volume Reaches New Heights
Bitcoin Ordinals, inscriptions similar to NFTs on Bitcoin, have been another ascendant sector over the last few weeks. Just this past week, total volume on Ordinals marketplaces hit an all-time high.
Solana DEX Volume Reaches Nearly 40% of Ethereum’s
A lively memecoin and microcap season and the PYTH airdrop pushed Solana DEX volume to an all-time high today. It was nearly 40% of Ethereum’s total volume over the past 24 hours.
On a longer time frame this growth is even more apparent. Solana DEX volume has grown from less than $200M per week in September to over $2B last week.
It isn’t a secret that I’ve been bullish on Solana and its ecosystem. While Ethereum historically has dominated DEX activity, in the past there were few cheap alternatives for retail investors with an established ecosystem. BSC gained a lot of traction in 2021; however, it’s always been difficult to access for people in countries. If new users continue to enter the market, I’m expecting many of them to experience DeFi for the first time on Solana.
🛠️Tool Spotlight
Solana Airdrop Checker
With the Pyth airdrop rolling out today, the Jupiter airdrop announced, and a large number of Solana DeFi projects running points systems, Solana DeFi is shaping up to have a large airdrop season.
As these airdrops are announced, you can use this tool to check your availability. Note that for Pyth, certain users of Ethereum, Cosmos, Sui, and Aptos were eligible as well.
📅Key Events This Week
That’s all for this week. For more frequent content, follow me on Twitter and YouTube.
Until next time,
Patrick Scott
Dynamo DeFi
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