Recently, there has been an increasingly loud voice in the circle that if Kite fails, it would be equivalent to sentencing the "AI+Crypto" track to death. To be honest, every time I hear such rhetoric, I want to laugh. It's like when I lost some money last year in that so-called "never-inflation" DeFi project and then vowed never to touch DeFi again; it feels a bit childish. When can the success or failure of a project be equated with the future of an entire track? To clarify this issue, we need to break it down and see what Kite is actually doing, why it might fail, and then put it back into the broader context of the AI crypto field to see how significant its weight really is.
Let's start with a sandbox simulation. Suppose, I mean suppose Kite really fails, what is the most likely reason? Is it that the technology does not work? I think that's unlikely; in the field of AI large models, the speed of technological iteration is measured in days, and today's bottleneck might be broken by a new algorithm next month. A greater possibility, I believe, lies in the balance of the economic model. One of the three non-standard criteria I personally use to judge such projects is whether the benefit distribution mechanism among computing power, data, and models can form a positive cycle. Kite's design is very ingenious, attempting to use token economics to incentivize decentralized computing power contributions and high-quality data labeling, but the problem is that this ingenuity also means fragility. Early contributors are in it for a high return expectation, but once the market enters a bear phase or the project's development speed does not meet expectations, the effectiveness of token incentives will be significantly reduced. Will the computing power providers and data contributors experience large-scale losses? This can create a death spiral. At that point, it’s not that AI technology is lacking, but that the Crypto approach has not been successfully navigated.
Let's zoom out a bit and take a look at the entire 'AI+Crypto' landscape. Kite is a star, but it is not everything. We see projects focused on the decentralized computing power market, with the pure goal of creating an 'Uber for AI', matching the demand and supply of computing power; there are also projects focusing on on-chain AI agents, allowing AI to become entities that can directly execute on-chain operations, which has already shown amazing potential in automated trading and complex strategy execution; and there are those creating AI-driven content generation, mixing in NFTs to create a bunch of new playstyles. The technical paths, business models of these projects are completely different from Kite. The success or failure of Kite has reference value for them, but it is by no means decisive. For example, another project I have been following, which focuses on on-chain data privacy computation, recently announced a collaboration plan with several large medical institutions to protect data privacy through zero-knowledge proofs, while allowing AI models to utilize this data for training. This path has almost no intersection with Kite's narrative.
So, returning to the initial question, the failure of Kite can at most only prove that the technical implementation path it chose, or that economic model, encountered huge challenges at a certain stage. But this does not negate the enormous potential of the combination of AI and Crypto. The true Holy Grail in this field lies in how to use blockchain's production relationships to reshape productivity in the AI era. Kite is just one of the explorers; its exploration, whether successful or not, will provide valuable experience and lessons for future entrants. To pin the hopes of the entire landscape on a single project is itself a form of laziness and gambling. What we really need to think about is, where will the next breakthrough point emerge? Is it a more stable economic model or a deeper technological innovation?
In the AI+Crypto space, what models do you find most promising or most difficult to understand? Feel free to chat in the comments.
Disclaimer: This article is solely a personal opinion sharing and does not constitute any investment advice. The market has risks; investment requires caution.
