Artificial Intelligence (AI) has become the catchphrase for 2023. Chatbots have shot to popularity and developments from the AI space are coming thick and fast. AI tokens have also piggybacked on the trend, registering massive gains over the last few months. For instance, at the time of writing, big data and AI projects like SingularityNET, Fetch.AI, The Graph, Render Token, etc. had experienced 918 percent, 328 percent, 230 percent and 166 percent gains since the start of the year, respectively.
Now, a new project that's looking to get in on the action is CryptoGPT (GPT). The newly-launched protocol is looking to combine blockchain technology, artificial intelligence and data monetisation to provide value and utility for all its ecosystem participants. As such, the platform’s native token has also been posting sizeable gains since its launch. But what is CryptoGPT and how does it work? Tag along to find out.
What is CryptoGPT?
CryptoGPT is an Ethereum layer-2 scaling solution that uses zero-knowledge (ZK) rollups to increase throughput. ZK-rollups use unique validity proofs to validate off-chain transactions. These transactions are then bundled together and sent back to the mainchain to be stored. This mechanism of validating transactions and bundling them together off-chain helps reduce congestion on the main chain. Therefore, these layer-2 solutions can take on additional transaction volume without affecting the transaction processing times and fees of the main chain. That’s why they are called layer 2 scalability solutions.
Now coming to the goal of CryptoGPT. According to its website, the project is looking to “turn data into a valuable asset used in AI models to power value creation in many industries.” Big tech firms have been monetising user data for years now, without providing any real benefits or rewards to the users.
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Data is expected to become more valuable with the boom of AI. The machine learning algorithms that power AI systems are heavily dependent on data. CryptoGPT will use a data-to-AI engine model that will collect, process, encrypt and package data for commercial use.
In a nutshell, CryptoGPT will record, encrypt and anonymise user data using zk roll-up technology. This data is the product that can be used to strengthen AI and machine learning platforms.
Users can use the various apps existing on the CryptoGPT network. Their activity data will be stored as encrypted NFTs which can be sold to other AI and machine learning platforms. The difference is that all this is done with the user’s permission, and for the amount of money they want. Users can sell their data and receive GPT tokens every time a platform uses it.
Apps look to come on board as they can collect data with consent from users. They can then sell this encrypted data to hundreds of businesses globally. Users join the network to use its native apps and get paid while doing so. And finally, CryptoGPT will collect transaction fees from all the network activity. The network already has a handful of apps in fitness, dating, games and education which have drawn in over 2 million ecosystem users.
The GPT token
The GPT token is at the centre of the CryptoGPT ecosystem. It will be used to pay gas fees on the network. It can also be staked to earn validation rights. Most importantly, users will be paid in GPT tokens for their activity data. Holders of the GPT token will also earn voting rights on various proposals on the platform’s DAO.
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The platform will have a maximum supply of 3 billion GPT tokens. Of this total supply, 20 percent will be reserved for a public sale, another 20 percent will go towards staking, and 25 percent will be distributed to users who provide their data. The remaining tokens will be distributed to the team, used for marketing, and reserved for future development.
GPT is already listed on several prominent exchanges, including ByBit, Huobi, MEXC Global, Bitget, Gate.io, Uniswap and PancakeSwap. The token has also registered sizeable gains since its launch. It jumped from $0.0534 on March 10 to $0.1030 at the time of writing, according to data from CoinGecko. That presents a 92 percent gain in less than two weeks.
Conclusion
Artificial intelligence is the next big thing in the tech space. As such, there is real momentum backing AI crypto projects, as evident from the skyrocketing prices of their native tokens. CryptoGPT is no different. The platform offers value and utility to users and developers on the network. As such, it could see significant growth in the future. However, cryptocurrencies are highly volatile and their prices can tumble despite the strongest indicators. Therefore, it is extremely important to do your own research and invest only as much as you can afford to lose completely.
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