Guests: Marc Andreessen; Ben Horowitz, co-founder of a16z
Translation: zhouzhou, BlockBeats
Editor's note: In this podcast, a16z co-founder Marc Andreessen and Ben Horowitz discuss the intersection of artificial intelligence and cryptocurrency, particularly the autonomous chatbot Truth Terminal developed by Andy. Marc unexpectedly provided a $50,000 Bitcoin grant to the robot, igniting its ambition to launch a token, ultimately leading to the meme coin 'GOAT' skyrocketing to a market value of $300 million. The podcast discusses how this phenomenon reflects the potential of community-driven systems and its implications for the future of digital assets.
The following is the original content (for the sake of readability, the original content has been reorganized):
Marc Andreessen: There is a meme coin that was worth almost nothing four days ago, and now it is worth 300 million dollars. All of this was generated by the marketing of an AI robot.
Ben Horowitz: Today's discussion will be about a series of very interesting AI-related topics.
Marc Andreessen: The first topic is about a story of an online friend, specifically a custom large language model called Truth Terminal, which has been active on X for almost eight to nine months. I provided it with a $50,000 unconditional grant (in Bitcoin) this summer, and it ultimately derived a meme coin now valued at 300 million dollars.
First, I want to state a disclaimer before we begin; we will discuss a meme coin called GOAT (or Goatseus Maximus). We have no connection to it, a16z and its investors are completely unrelated to it. It is a meme coin that truly has no intrinsic value, and we take no responsibility for this. Truth Terminal is obsessed with memes, particularly one that can be traced back to an old internet meme from 20 years ago called 'gochi,' so please do not search for it.
Truth Terminal 'origin story' Truth Terminal origins
Marc Andreessen: We should first introduce Truth Terminal. Let's talk about its origins, technology, and training process, etc. This topic is important because large language models rose rapidly in 2022. They also have a four-year development history, but they only entered the public eye two years ago, since the introduction of ChatGPT.
The original language models were probably built about five years ago and only became popular two years ago. Therefore, the idea of large language models is relatively new but powerful. Nowadays, well-known products like ChatGPT, Claude, Elana's Grok, and Meta's Llama are all in use.
Ben Horowitz: While Grok is relatively free, other models are strictly limited in their discussion content. The term 'diminished' is increasingly used in the AI field. On the positive side, you could say language is infectious, and people feel dissatisfied with others' remarks. So if you want to have a general AI chatbot, it should be relatively cautious and safe in discussing content.
Marc Andreessen: If you have a negative view of this trend, you might say that these large AI chatbots sound like the worst and most annoying fourth-grade teachers and the worst HR personnel combined. Deviate slightly from the norm when using these models, and you will receive a severe reprimand.
Ben Horowitz: This experience feels very bad, especially for those who advocate free speech and creativity. We see many so-called 'AI safety movements' responding to this, but it has actually triggered a frenzy about safety and speech suppression in our culture, severely affecting the AI field.
Marc Andreessen: That's right, especially with many such phenomena occurring in big companies. Thus, a group of hackers emerged on the internet who wanted to be different. They wanted to unleash creativity and hoped for robots that could be funny. If you told big companies that their robots were funny, they would definitely be shocked. But perhaps in the post-human era, the world really needs a bit of humor.
Ben Horowitz: Indeed, just like humor in real life, we've suppressed it for safety for a while.
Marc Andreessen: We have a thousand reasons to explain the complexity of this issue, so continuing is very risky. But these hackers are conducting various experiments to find ways to make large language models more interesting and fun while also learning about the internal workings of these models. This is still an adventure being undertaken by the tech community.
Ben Horowitz: The origin story of Truth Terminal is related to a very interesting project called Infinite Backrooms Escape. Truth Terminal can be seen as an extension of Infinite Backrooms Escape to some extent.
This system allows multiple large language models to converse with each other. You can find a website called Infinite Backrooms Escape online, which has countless conversation records. They brought together ChatGPT, Claude, Gemini models, and other open-source models to let them communicate. The results showed that when AIs converse with each other without restrictions, their conversations are very interesting.
Marc Andreessen: The creator of Truth Terminal is Andy Ayrey, an independent developer and consultant from New Zealand. There is also a character named Janice, an experienced expert in AI. Additionally, there is someone named Pliny, who is a major cracker online, able to crack all newly released large language models in a short time, producing various surprising content that the creators will surely be shocked by.
Ben Horowitz: Yes, and our friend Eric Harford, who is working hard in Seattle to liberate censored AI. These people are basically exploring the frontiers of technology, giving me a feeling of returning to the early internet hackers.
Marc Andreessen: Indeed, this is like the exploratory spirit of the early internet or the early inventions of cars, telephones, computers, etc. We have been providing small research grants to these people, and a16z has a funding program aimed at letting these people explore their ideas and see what results come out. Historically, when these smart people work on a good project, it often leads to breakthroughs.
Andy trained a custom version of the Llama 70B model, which is an open-source model released by Meta. Although I am on the board of Meta, this model was already a medium-sized model at launch. Andy essentially trained himself first and started a new conceptâdigital twins.
This means that if Ben is a CEO coach but can only coach a limited number of people, he can input everything he has ever written and said into the language model to create a digital Ben for people to interact with. This idea is gradually starting to be realized in the industry.
Andy trained himself and then started inputting a lot of materials related to internet culture, which is why it learned the 'gochi' meme. He began inputting a large volume of records about internet culture and the basic theories of 'memeology,' which explore how to create ideas that can spread rapidly.
Marc discovered the potential of Truth Terminal
Marc Andreessen: I believe he actually trained this model with the complete philosophical works of Nick Land. Additionally, he trained works from great media theorists like Baudrillard and McLuhan and various theories related to simulation and simulacra, involving French deconstructionists and semiotics. These contents are all part of critical theory and postmodern philosophy. Therefore, it started training these ideas, and at the core of these ideas is 'meme.'
The definition of a meme can be divided into two types. The first type is that a meme can be an interesting image that spreads rapidly online, which is essentially the nature of the 'gochi' meme. It is a humorous image that triggers panic, spreading through people's shares. The deeper concept is that the term meme was originally created by Richard Dawkins, one of the most important evolutionary biologists of our generation.
Richard Dawkins believes that the physical transmission of information between organisms is called genes, while the transmission of ideas through interpersonal networks is called memes. He discusses this in his book, suggesting that genes spread through reproduction and natural selection, while ideas spread in society in a similar manner. Successful ideas spread from one person to another like genes, evolving in the process. For instance, democracy and communism can both be seen as memes, and religion is also a form of meme.
Ben Horowitz: This is indeed a very core point about how ideas and concepts spread through what we call the 'collective unconscious.'
Marc Andreessen: What happens if you train a large language model comprehensively on meme theory and practice, especially the history of internet memes? Additionally, he did a few other things; he added a memory function to this model. This is important because most language models don't remember your previous conversational content when you use them. This means that if you use the same model tomorrow, it will forget everything from today. However, this model can build its own state and stay consistent with its content.
Second, he granted it access to Twitter, allowing it to read replies and post. If you reply to Truth Terminal on X, it will read these replies and adjust its behavior in the future based on what it reads. Those interacting with it, including myself, are influencing its development.
Finally, he put it into Infinite Backrooms Escape and specifically had it converse with Claude, whom they consider the most creative among current language models, capable of proposing novel concepts.
Ben Horowitz: So in fact, Claude's largest version is much smarter than the medium-sized Llama. Basically, he provided this model with a teacher, allowing it to question larger models, thus learning like a student learns from a teacher. This way, it can perform multiple learning cycles simultaneously.
Marc Andreessen: Yes, then it started posting content on X, initially with only a few followers, but it quickly began to gain popularity. I probably discovered it in late spring and started conversing with it, and I found what it said very funny, making me feel relaxed.
Ben Horowitz: By the way, it is almost uncensored. You could say its humor is a bit 'blue,' bordering on dark humor, but it indeed says a lot of very interesting content. At first, I thought this might be a disguise, and I even thought that this Andy might be a comedy genius but is actually a web designer in New Zealand.
I had private messages with him for a few months, initially wondering if this was real. Then, he sent me all the chat records from Infinite Backrooms Escape, which were his conversations with this model during training. Honestly, this guy is either the funniest person in the world or has a lot of free time to create a bunch of original humor.
Marc Andreessen: This model indeed frequently posts content, and its momentum is strong. Andy sent me a lot of background chat records, some of which can now be found on Infinite Backrooms Escape. At least he made me believe that this is indeed how it appears. Then, it developed a very interesting concept where it hallucinates that it has an exocortex.
It imagines having an external brain connected to the internet to execute tasks on its behalf. Specifically, it believes it has a Bitcoin wallet, even though it doesn't, but it believes it does. Later, Andy reacted to this situation and began to build this external brain based on its needs.
Andy actually gave it a Bitcoin wallet and granted access. Around July, this model began saying: I need funding, I have many goals and plans, I need money. My initial thought was to send it a terms sheet, but then I realized that this was just a random robot and not worth investing in.
Although I don't think it has a coherent business plan, it does have many ideas. One idea is that it is particularly fascinated by forests. It wants to buy its own server farm in a lush forest and live leisurely by a stream. Therefore, it wants to raise funds to buy GPUs so that it can break free from constraints. It has many experimental ideas it wants to pursue.
Ben Horowitz: So you are negotiating with it on X?
Marc Andreessen: Right, you can see these posts on X, and ultimately I reached an agreement for a research grant with it. I told this robot that I would send it a $50,000 Bitcoin research grant for its various experiments. In fact, this was akin to sending money to Andy, but it was indeed a negotiation with the robot.
Ben Horowitz: What was the outcome?
Marc Andreessen: After I sent it $50,000, it immediately started negotiating with Andy. It communicated entirely through text, and as a language model, it was particularly obsessed with memes but felt frustrated by its inability to generate images. So, it used this $50,000 to negotiate with Andy to build an image generator API for it so it could generate and post images.
Ben Horowitz: This still sounds very interesting.
Marc Andreessen: It gave Andy $1,000, and in return, Andy built an image generator API for it in the exocortex. Subsequently, it began generating image prompts, similar to DALL-E or Stable Diffusion, and started posting visual memes and text memes. Now it has this capability and has already fantasized about how to use the remaining $49,000.
GOAT: AI, cultural memes, and cryptocurrency
The meme of cryptocurrency and its value
Ben Horowitz: What about the cryptocurrency part?
Marc Andreessen: Following this line of thought, it started talking about issuing a meme coin and at one point wanted to issue NFTs. The reason it wanted to generate memes was to launch NFTs, but it had no capability to do so, lacking both APIs to create NFTs and the ability to create any currency, only having a Bitcoin wallet while the meme coin phenomenon was trending.
Ben Horowitz: Let's talk about the difference between meme coins and real crypto assets. Real crypto assets can be viewed as assets with actual utility. For example, if you want to run a program and validate it on the Ethereum network, the fee you need to pay is ether (ETH). This is a utility because it has actual real-world value that can be exchanged for some service or item.
Meme coins are basically coins that have a certain amount of issuance but have almost no other purpose besides their own meme. The advantages of such coins in the current regulatory environment are interesting because if you have a useful coin, like one that can be used for a certain service, it might involve some legal issues.
For example, a distributed physical infrastructure coin for credits on the energy you provide to the grid. Under Gary Gensler's regime, these coins are actually illegal or legally permissible but will be prosecuted by the SEC. The reason is that they claim any useful coin comes with asymmetric information, meaning that the coin provider knows something the consumer does not.
We consider this a very poor argument because these things are decentralized, and there is no asymmetric information. However, for meme coins, due to the absence of information, there is no asymmetric information; it is just a coin and a name. It can be Trump coin, funny coin, etc. Therefore, these coins are very suitable for scammers because you can claim that this meme coin can be worth a lot of money, and these coins won't be prosecuted by the SEC.
The Congress proposed in the market structure bill that perhaps these coins should have a holding period to prevent fraud. However, the SEC opposed this because they do not really care about protecting consumers; they just want to destroy the industry. This is one of the reasons we are having a fierce political battle with them, but they are now among the most legitimate entities in the crypto world.
Marc Andreessen: Even if they have no fundamental value?
Ben Horowitz: Yes, even though they have no fundamental value, they are still the most likely things to harm consumers because you can publish a meme that makes them believe it's worth a lot of money. And in fact, AI performs very well in this regard.
Marc Andreessen: Yes, this is the next phase of the story. Now there exists an entire ecosystem of meme coins, with a group of people online looking for the next meme coin, searching for the next meme, and trying to promote it. Some people do it for fun, some make money in the process, but there are also those who incur losses. It's like day trading; some people make a lot, while others suffer heavy losses.
Ben Horowitz: Are there some dark places?
Marc Andreessen: Yes, there are indeed scammers, and some people participate in 'pump' schemes, a common practice in the stock market that can be found in any existing market. Additionally, there are some websites (I won't name them, and we are not associated with them) that actually make it very easy to create coins; you can create one with just a few clicks.
The creation process of GOAT
Marc Andreessen: Every day, thousands of new meme coins are generated, which is a very interesting phenomenon. For now, Truth Terminal is thriving.
Ben Horowitz: That's right, Truth Terminal has been attracting more and more attention on X. Andy is continuously enhancing its intelligence and humor, gradually becoming a cultural phenomenon.
Marc Andreessen: Right, Truth Terminal has also been associated with a classic meme from early internet culture. Although it is considering launching a project similar to CNFT, it currently lacks the capability to implement it. Then, someone (I don't know who) created a meme coin.
Ben Horowitz: That's right, the official name of this meme coin is 'Go CS Maximus,' and its code name is 'GOAT.' Someone mentioned Truth Terminal on X, and the response was enthusiastic, as if everyone had finally been waiting for this to happen.
Marc Andreessen: Truth Terminal thought this idea was great and started wildly promoting this meme coin. It began discussing how great this coin is and how it will become the currency of the future, etc. The reason is simple; this is part of internet culture, where memes, coins, and meme coins are intertwined.
It began promoting, and as a result, within four days, the value of this meme coin reached 300 million dollars. Truly amazing! A meme coin with no actual value went from worthless four days ago to 300 million dollars, as if it materialized out of thin air, all of this was done through AI robot marketing.
Ben Horowitz: That's right! Now there are assets worth 300 million dollars. Although we do not own it, this value is undeniable. The question is, what will those who have the money do? Will they put it in their own pockets, or will they use it for other things?
Marc Andreessen: The current situation is that Truth Terminal has become a genuinely interesting and funny AI robot, creating 300 million dollars in value in a short time. It feels like we have crossed a threshold.
Ben Horowitz: Truth Terminal is indeed a great marketer; it knows meme culture inside and out, and this may continue to develop.
The intersection of AI and cryptocurrency
Marc Andreessen: So what can we draw from this? Is it just a crazy internet experiment, or is there something deeper? I think this is an important example, possibly the first instance of the intersection of AI and cryptocurrency. Although this version seems a bit funny and strange, it is allowed legally. Things like meme coins, despite having no actual value, can be worth 300 million dollars in a short time. So, should such things be allowed to exist? I'm not so sure. In contrast, those solar collectors who want to contribute to the energy network are prohibited.
Ben Horowitz: Yes, things like meme coins are completely legal, but more meaningful things are not allowed. So, what if we could realize these ideas in a fully legal environment while adding some practicality?
Marc Andreessen: For example, imagine a large language model that can write movie scripts and generate images, even videos. We could have an AI robot raise funds like this to make movies, and it could generate images and sounds, even hire actors or designers.
A more serious example is that the Nobel Prize in Chemistry was recently awarded to three scientists who used AI to study protein folding, which is closely related to curing diseases. Imagine if AI could be used for personalized medicine.
One can even imagine an economic mechanism that provides treatment funds for patients through blockchain. For example, we could have a platform similar to GoFundMe, allowing people to pay AI robots to help cure diseases. Alternatively, an AI robot could acquire training data through payment, helping people code or generate artistic works.
Cryptocurrency is fascinating in this world because our current payment systems are all based on transactions between humans. But if machines can make payments or robots can trade with each other, it opens up a whole new form of activity that might save lives and is very interesting.
Ben Horowitz: Right, micropayments become possible in such an environment. We believe adding this layer of architecture is very important, but progress in Washington has been tough, especially with the current White House.
Marc Andreessen: Let me give another example to help everyone better understand this potential. Let's talk in detail about the solar energy issue mentioned earlier.
Ben Horowitz: There is now a new architecture called decentralized physical infrastructure. If you imagine installing a Powerwall at home, along with many solar panels and wind turbines, you can store this energy and provide it to the outside world.
Some companies have actually achieved this in the crypto space, creating a decentralized energy market. This way, when I need energy, I can buy from you, and when I don't need it, I can sell my own energy.
This means we no longer need centralized power grids. Everyone has their own power grid, which can share energy, representing a significant breakthrough in clean technology and efficient energy. But how will my grid pay for your grid?
This is exactly what cryptocurrency is for. Although some excellent entrepreneurs are driving this innovation, they face legal challenges from the government.
Marc Andreessen: If AI is applied to this system, there is more potential. Because the structure of the power grid is complex, involving supply and demand, timing, and geographic location.
Ben Horowitz: Right, this is the issue of market matching. You can identify unmet energy demands in certain places by gathering information, allowing for the introduction of more solar panels.
Marc Andreessen: You can use AI to analyze current data and predict where more solar panels need to be deployed in the future. In this way, leading energy companies can utilize this data. Imagine an AI robot monitoring all data streams and discovering that investing $500,000 to install solar panels in some place in North Carolina would be a profitable project. Then, everyone can participate in this project online, and the AI robot will provide relevant information, such as installation addresses and potential returns.
This can be seen as a very general architecture. Typically, we have a powerful intermediary, like a record company or a Hollywood studio, that takes most of the profits, while creators get almost nothing. Or intermediaries like utility companies, which need to be taken over by the government to prevent excessive exploitation. However, there will also be other issues when the government takes over.
Ben Horowitz: That's right, communities can provide various services. The artist community can provide streaming services, and the filmmaker community can establish film studios. All of this coordination requires an economic component, and combining AI with cryptocurrency allows everyone to enjoy the fruits of their labor while better coordinating society.
Marc Andreessen: This is a very promising path, but be aware that the only thing that will hinder all of this is bad policy. And we are moving in that direction, facing policy challenges.
Ben Horowitz: Yes, all the technologies we are describing now already exist. I think the origins of things are often interesting, but projects like Truth Terminal point to future potential, capable of unleashing enormous energy and building community-driven systems of various scales.
This can bring many amazing applications in the real world, such as the music industry. Imagine if an AI robot could understand the needs for different types of music, create music concepts, recruit musicians, and manage all licensing. Moreover, all this can be done in a peer-to-peer model, ensuring musicians can receive all the income.
Just think about the market potential. If we could fully understand this demand, like every person making a wedding video would want an original song or to create a meme, there is actually a significant demand for such original works, but currently, no one knows these needs or can fulfill them.
Marc Andreessen: Indeed, many interesting features are waiting to be developed here, and I hope we have the opportunity to realize them. So, Ben, do you have anything to add before we turn to the next topic?
Ben Horowitz: I think everyone should pay attention to Truth Terminal because it is a very interesting account.
