Pond, an innovative crypto startup, has raised $7.5 million in seed funding to develop a decentralized AI model layer tailored for Web3 applications.
Led by Archetype, this funding round includes prominent investors such as Coinbase Ventures, Near Foundation, Cyber Fund, Delphi Ventures, and key figures in the industry, including Illia Polosukhin (co-founder of Near Protocol) and Cynthia Wu (COO of Matrixport). Pond aims to transform how on-chain data is utilized across the crypto ecosystem through AI-driven models that bring new efficiencies to everything from DeFi to security. 🧠💹
In this ARTICLE, we’ll explore Pond’s mission, the technology it’s building, and how this startup plans to reshape data use in the decentralized landscape.
What is Pond? 🌐
Founded in 2023, Pond began as a tool for exploring blockchain networks through on-chain data. Users could enter an ENS name, such as vitalik.eth, and view associated connections to navigate blockchain relationships. However, as the startup developed, Pond saw a larger opportunity to create a unified graph network across all types of blockchain data—social, financial, and more—and expanded its focus to develop crypto-native AI models.
As CTO Bill Shi explains, Pond’s ultimate goal is to create a "complete model ecosystem," encompassing everything from data processing to model training and inference, all optimized for blockchain. This ecosystem enables Pond’s models to extract value from blockchain data and provide actionable insights for users, similar to how models like GPT and Llama power productivity in Web2 applications.
Key Innovations: How Pond’s Models are Transforming Crypto 🛠️
Pond’s decentralized AI model layer has already shown promise across several use cases, each addressing a different blockchain need:
1. Security 🔒
Pond’s graph-based AI model for security is designed to detect malicious addresses with remarkable accuracy, achieving an accuracy of 0.936 and a precision of 0.935. This model, set to be deployed by an industry-leading security firm, provides early warnings for potentially malicious activity and aims to enhance overall trust within the blockchain space.
2. Recommendations 🎨
Pond’s recommendation models offer personalized suggestions for Web3 users. For instance, they suggest NFTs on Zora or DeFi protocols on Gearbox, helping users navigate the vast array of options in the crypto market. This tailored experience simplifies decision-making, especially for newcomers, and could become a key driver for engagement on Web3 platforms.
3. DeFi Fee Optimization 💸
In DeFi, liquidity providers often struggle to set optimal transaction fees. Pond’s dynamic fee model helps address this issue by adjusting fees based on predicted outcomes. When a trade is likely to result in losses for liquidity providers, the model increases the fee to mitigate risks. Conversely, fees are reduced for profitable trades, encouraging more participation. This approach maximizes returns for liquidity providers and improves the efficiency of DeFi ecosystems.
How Pond’s AI Models Compare to Web2 Solutions 🧩
While Web2 AI models like ChatGPT assist with general tasks, Pond’s Web3 models focus specifically on processing vast amounts of decentralized, on-chain data that are often difficult to analyze manually. The complexity and messiness of on-chain data make it challenging to extract meaningful insights, but Pond’s models transform these raw data streams into actionable, comprehensible information. This focus on Web3-specific applications is a significant leap forward in enabling practical uses of blockchain data.
According to Shi, “By leveraging AI capabilities, we transform what is beyond human understanding into comprehensible information, helping users make better use of on-chain data.”
Future Plans: Expanding Crypto-AI Applications 🌱
With its recent funding, Pond plans to scale up its operations, enhance its product suite, and grow its team of 11 by adding roles like Chief Operating Officer, Product Manager, and Ecosystem Growth Manager. Here are some of the upcoming areas where Pond intends to apply its AI model layer:
DeFi Risk Management: Advanced models to assess and mitigate risks in decentralized finance.
Insider Trading Detection: Graph algorithms to monitor suspicious trading patterns and flag potential insider activity.
Personalized Recommendations: Further refinement of recommendation engines to provide even more tailored suggestions across DeFi and NFT spaces.
By tackling these complex challenges, Pond aims to become the go-to platform for AI-enhanced insights within the crypto world, unlocking the potential of blockchain data in ways previously limited by traditional analytical methods.
Investor Confidence and Market Potential 💹
Archetype’s lead investment in Pond reflects growing confidence in AI’s role within the blockchain ecosystem. According to Pond’s CEO Dylan Zhang, the round was structured as a SAFE agreement with token warrants, giving early investors both equity and the opportunity to participate in future tokenized products.
The involvement of Coinbase Ventures and Near Foundation highlights the appeal of Pond’s technology to established Web3 entities, as it fills a critical gap in blockchain analysis and security. With big names backing the vision, Pond is well-positioned to bring AI-driven insights to crypto in a way that’s secure, scalable, and suited to the decentralized economy.
Final Thoughts 🧠
Pond’s $7.5 million seed funding marks a significant step for the crypto-AI sector, addressing real-world challenges in Web3 with sophisticated, decentralized AI models. As blockchain technology grows and data on-chain becomes increasingly complex, Pond’s approach to AI promises to unlock new levels of efficiency and security, setting a new standard for Web3 data utilization.
For crypto enthusiasts, DeFi investors, and blockchain developers alike, Pond’s innovations are worth watching. As it rolls out more AI-driven tools, Pond could well become an essential layer in the emerging crypto economy, making on-chain data not just accessible but transformative. 🌐
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NOTE: This article is not a paid or sponsored post. It is intended solely for educational purposes. As always, please conduct thorough research (DYOR) before making any investment decisions in the cryptocurrency market.
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