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The Kayon AI reasoning engine layer is the "brain" of the Vanar ecosystem, functioning as an on-chain AI processing unit that interprets and applies logic to the data stored by the Neutron semantic memory layer. Its primary function is to enable smart contracts and AI agents to move beyond simple transactional logic and engage in complex, verifiable decision-making directly on the blockchain.

The functioning of the Kayon layer involves several key aspects:

Interpreting Semantic Data: Kayon reads the highly compressed, AI-readable objects (called "Seeds") stored in the Neutron layer. These seeds contain not just raw data but rich context and meaning, which Kayon uses as its knowledge base.

On-Chain Reasoning: It allows for computational reasoning over this data without needing external oracles or off-chain computation. For instance, a smart contract can ask Kayon to verify specific text within a digitized invoice stored on-chain before automatically triggering a payment.

Explainable Intelligence: A key feature of Kayon is that it ensures AI decisions are not "black boxes". The reasoning process is auditable and transparent on the immutable ledger, which is crucial for enterprises and regulated industries that require explanations for automated financial decisions.

Triggering Automation: By enabling smart contracts to reason over data, Kayon serves as the catalyst for automated workflows (managed by a future layer called Flows). This allows AI agents to act autonomously based on complex, verifiable information, such as managing a company's treasury or enforcing compliance rules, without constant human oversight.

In essence, Kayon transforms passive on-chain data into active, intelligent information, providing a robust framework for building sophisticated, AI-native applications that can think, remember, and act safely within the Vanar ecosystem.