Project name: Morpheus

Project Type: Intelligent Agent Artificial Intelligence (AI)

Token symbol: $MOR

Cryptocurrency Ranking: N/A

Market cap: N/A

Full Issue Value (FDV): N/A

Circulation supply: N/A

Maximum supply: 42 million

opening words

Greythorn recently analyzed several AI projects, highlighting that artificial intelligence and its significant impact in the coming years are worthy of attention. At the same time, Greythorn sees growing demand for open source large language models (LLMs). It is worth noting that these LLMs usually lack basic features such as user-friendly interface and effective management of user data. To solve these problems, smart proxy protocols are introduced. It facilitates the management of local LLMs through a Web3 wallet, enhancing user experience and control.

As the AI ​​market prepares for significant growth, with many key players predicting that AI will play a key role in the mainstream adoption of cryptocurrencies, Morpheus is challenging the centralized AI space with its innovative AI agent network, providing a transparent and fair launch strategy, making it a key project in the future AI landscape.

Project Overview

MorpheusAI marks significant progress in combining AI with blockchain, especially for Web3. It goes beyond traditional smart contracts (which are reactive) and leverages AI Agents for proactive, real-time decision-making. This shift from basic automation to complex, autonomous task management is enabled by advances in large language models (LLMs), which combine the analytical power of AI with the efficiency and security of blockchain.

MorpheusAI not only enhances various areas such as service markets and crypto gaming by enabling complex AI-driven tasks, but it also integrates seamlessly with Web3 technology. It provides APIs, decentralized cloud services and easy integration with cryptographic tools and DApps, aiming to make personal AI agents or intelligent agents widely available. These smart agents can interact with users’ wallets, DApps, and smart contracts, bridging the gap between traditional technology and blockchain technology.

MorpheusAI provides a user-friendly and innovative approach to AI in blockchain by allowing natural language communication with intelligent agents and proposing a network backed by a token system to incentivize development and usage. It establishes itself as an open source alternative in a field dominated by closed source models, providing a secure and efficient solution that enhances the blockchain ecosystem for developers and users.

Morpheus key attributes

● Web3 Integration: Morpheus is inherently Web3 native, enabling users to trade cryptocurrencies, use smart contracts, and access DApps and DeFi services, beyond the capabilities of current LLMs that lack direct Web3 connectivity.

● Decentralization and cost efficiency: By running on decentralized public infrastructure, Morpheus avoids the regulatory and cost barriers faced by centralized entities, providing a more affordable and flexible solution for AI deployment and use.

● Developer-friendly platform: Morpheus provides developers with a Linux-like alternative to quickly create new agents or LLMs without incurring costs while ensuring data ownership and security.

● Innovative reward system: The platform incentivizes the contributions of various roles, including capital providers, coders, computing providers, and community builders, through a token-based system that rewards participation and contributions to the Morpheus ecosystem.

Morpheus path

● Capital certification and rewards

Capital providers support the network by providing stETH, generating revenue, and contributing to protocol owned liquidity (PoL). This mechanism ensures liquidity in the ecosystem, rewarding capital providers with $MOR tokens in proportion to their contributions.

● Code certification, registration and rewards

Developers contribute code to the Morpheus network and are rewarded based on the value of their contribution. This system encourages the development of specialized agents and tools that enhance the platform's capabilities and user experience.

● Calculation proofs and rewards

Computing providers provide the resources required by the AI ​​model and receive compensation rewards based on demand. This approach ensures efficient use of resources and rewards providers for their contribution to the network's computing needs.

Source: Morpheus

● Community builder certification, registration and rewards

Community builders develop and provide user interfaces and developer tools to facilitate interaction with the Morpheus API. They are rewarded based on the fees generated by their contributions, fostering the development of a vibrant and supportive ecosystem.

Source: Morpheus

Morpheus Technology

● Technology stack and smart contract development: Morpheus leverages the Ethereum blockchain and its ERC20 standard for MOR tokens, with plans to expand to other Ethereum layer 2 solutions and compatible blockchains to enable wider adoption and functionality . User data security: Putting data security first, Morpheus plans to use fully homomorphic encryption (FHE) technology to provide enhanced user data protection for LLM to ensure security within the point-to-point network.

● Bootstrapping and network growth: The bootstrapping period will facilitate the initial distribution of MOR tokens and ensure a balanced and fair starting point for the network. This phase is critical to establishing a stable foundation for Morpheus's growth and utility.

Tokenomics

Assignments and rewards

● Daily distribution: $MOR tokens are distributed daily, with the community (builders and creators who develop tools and front-ends driving user engagement and growth) accounting for 24%, and capital providers, computing resource providers, and coders each accounting for 24% , and the other 4% is reserved as a conservation fund.

● Total supply: $MOR tokens were capped at 42 million, with no premine or early token sale ensuring a fair launch, which took place on February 8th.

● Block reward: Starting from 14,400 $MOR per day, the reward decreases every day until it reaches zero on day 5833, changing the incentive model from block rewards to transaction fees.

Source: Morpheus

Utility of MOR Token

$MOR serves as an on-chain mechanism to facilitate transactions within the Morpheus network, such as:

● Developers pay the computing provider for API calls. Transactions are for specific proxies created by developers. Reward users who provide training data for new LLM/agents

Token distribution stage

Early stage: startup stage

● Capital providers: receive $MOR based on their stETH contributions.

● Calculation provider: Handle user prompts with $MOR compensation.

● Coder: Earn $MOR rewards for your contributions to Morpheus software.

● Community Builder: Earn $MOR for participating in front-end, tools and value-added services.

Medium term: wider circulation

● Block rewards and transaction fees are balanced across all roles.

Long term: deep liquidity

● Transaction fees become the main incentive mechanism in the ecosystem.

tail emission strategy

To ensure long-term survival and continued incentive alignment, Morpheus adopts a "tail emissions" strategy:

● Post-block reward: After the initial distribution period, tail emissions based on 50% of burned $MOR tokens ensures ongoing rewards. This $MOR tail emission will begin after the last $MOR token issuance on day 5833 of the distribution schedule (approximately 16 years).

● Circulation cap: Tail emissions are limited to 16% of tokens in circulation, maintaining the scarcity and value of $MOR.

By ensuring that tail emissions are only a portion of the tokens that are burned, the total circulating supply of MOR will not exceed the hard cap of 42 million. In reality, the total supply of MOR may become increasingly scarce over time as some tokens are burned and only partially replaced. This approach allows the Morpheus ecosystem to maintain a balance between incentivizing participants and ensuring the scarcity of the MOR token.

The chart below shows the number of $MOR tokens available over time, starting from the first 5833 days and going from year 17 to year 256. Let’s say an average of 25% of $MOR tokens were destroyed or “burned” during this period.

Source: Morpheus

Competitive product analysis

Olas (formerly Autonolas) is at the forefront of AI intelligent agents and is considered one of Morpheus' main competitors. We've discussed Autonolas in detail and compared it to Morpheus and Fetch.ai, so I'll just give you a brief overview here. Autonolas stands out for operating on multiple blockchain platforms, which increases its adaptability and wider adoption. It specializes in creating and deploying autonomous agents for developers, dApps, and users, emphasizing shared governance and ownership.

Morpheus, on the other hand, is focused on making AI and computing power as widely available as PCs and smartphones. It emphasizes giving individuals the ability to own and use AI agents and computing resources, going beyond AI to cover a wider range of computing capabilities.

While the two projects compete for market share, they actually have complementary goals. Autonolas focuses on the governance of autonomous agents across different blockchains, while Morpheus focuses on providing individuals with access to AI and computing resources. This difference in focus suggests that there may be opportunities for mutual interest and cooperation between the two.

Overall, Autonolas provides a blockchain-independent platform for governance and shared ownership of autonomous agents, while Morpheus aims to put AI and computing power directly into the hands of users

Bullish fundamentals

● Since its debut, 1% of Lido stETH has been staked in the Morpheus Capital Provider Smart Contract, reaching 99,717 stETH in just 20 days.

● MorpheusAI introduces a new reward mechanism that proactively rewards various contributors with $MOR tokens, promoting an ecosystem of collaboration and incentives.

● The rapid development of AI technology has led to AI agents increasingly replacing human labor in various fields. The CEO of Anomica Brands predicts that 7080% of transactions will soon be conducted through autonomous AI agents, pointing to a transformational change in the way transactions are conducted.

● The DeAI space has been particularly popular following the launch of ChatGPT, which ranked first in CoinGecko’s 2023 search traffic rankings by sector, indicating growing interest despite accounting for a small share of the overall cryptocurrency market capitalization.

● As the founder of MorpheusAI, David Johnston has been at the forefront of decentralized technology, introducing “Dapps” in 2013 and later “Smart Agents” in 2023.

● MorpheusAI actively participates in important events such as the 2023 Decentralized AI Summit, demonstrating its commitment to leading and shaping discussions in the field of decentralized AI.

● MorpheusAI’s unique features, such as Techno Capital Machine (TCM) and commitment to fair launch, allow it to make a significant impact in the agency space.

● Considering the valuations of similar agency projects such as OLAS ($3.5 billion FDV) and FET ($1.5 billion FDV), MorpheusAI shows significant growth potential, supported by a large addressable market (TAM).

Bearish fundamentals

● Like any project utilizing blockchain and AI, Morpheus is susceptible to security risks, including smart contract vulnerabilities and potential AI model manipulation. Any major security breach can severely impact trust and user adoption.

● The success of Morpheus also depends on its ability to provide a user-friendly experience. The technical complexity of managing AI agents and blockchain operations may deter non-technical users, limiting adoption.

● Bear market conditions or a loss of investor confidence in crypto assets may indirectly affect project performance.

● Morpheus’ economic model, including its token economics and incentive structure, needs to prove sustainable over the long term. Any design flaws may lead to issues with liquidity, token value stability, and overall project sustainability.

● Convincing users to switch from traditional AI platforms and services to decentralized models can be a challenge.

● The actual implementation of its vision faces significant technical obstacles, including scalability, interoperability between different blockchains, and ensuring the effectiveness and security of AI models.

Conclusion

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