Since the AO network's testnet launch on February 26, there has been a significant increase in messages and user numbers, indicating rapid development. The integration of Arweave and AO Network marks the beginning of the Permaweb 1.0 era, promoting the growth of ContentFi and AgentFi applications. The innovative token minting mechanism of AO ensures long-term value, while its economic model protects the interests of AR holders and incentivizes external funding. Breakthroughs in AI technology support the operation of Large Language Models, expanding application boundaries. The AO ecosystem is quickly taking shape, showcasing performance and technological innovation, with a promising future ahead.

Author: Kyle

Translator: Kyle

Reviewer: IB

Source: Content Guild Translation

In a market environment lacking technological innovation, the rise of parallel EVM narratives demonstrates a strong demand for parallel execution mechanisms. Similarly, the hyper-parallel computer AO, based on Arweave and utilizing off-chain computation, is also fulfilling this mission. Since the release of its testnet, AO has garnered significant attention. With more builders joining, the network has become increasingly active, and the nascent ecosystem is beginning to take shape.

June marked a milestone month for the AO ecosystem. Several major technological innovations and key initiatives were concentrated in this month, creating more possibilities for AO's future development. This article will provide a detailed analysis of AO's latest progress from various perspectives, including network overview, Permaweb 1.0, whitepaper release, AI technological breakthroughs, and ecosystem layout.

Overview of the AO Network: Significant Increase in Message Volume and User Growth

Data Source: AOLink

The AO network has remained active since its inception. As of June 26, the network's message volume surpassed 200 million. Remarkably, just 13 days later, it reached the 250 million milestone, demonstrating rapid growth.

The table below shows the growth in message volume since the testnet launch on February 26:

The data indicates that the daily message volume has been consistently increasing, with an average of 3.9 million daily messages over the past two weeks. This highlights not only rapid growth but also a significant acceleration in message volume.

Moreover, the number of users, both regular users and developers, participating in the AO network has been rising sharply. As of July 10, the total number of users exceeded 170,000. In terms of developer engagement, the number of active developers on the AO network has consistently exceeded 5,000 daily over the past month, with active developers reaching 10,000 on one-third of those days.

Arweave and AO Combined: The Start of the Permaweb 1.0 Era

Permaweb, built on Arweave, is a new type of decentralized internet architecture. Users can access all content stored on Arweave, including applications, photos, and videos, in the same way they would on Web2 websites. Permaweb allows content to flow freely among various native applications, ensuring users have control and use of their data in an open and fair network environment. Its vision is to break away from the current isolated network structure controlled by a few giants, guaranteeing freedom of speech, content ownership, and choice for users.

The Arweave network has been operational for six years, with a series of mature applications and services already launched on Permaweb. With the introduction of the AO hyper-parallel computer, all Permaweb applications can now be adapted to AO. This marks the official beginning of the Permaweb 1.0 era, greatly expanding the possibilities for application development, and ushering in a new era of ContentFi and AgentFi applications. Thus, Permaweb 1.0 can be summarized as Arweave + AO + ContentFi + AgentFi.

Building ContentFi, Starting with the Acquisition of Odysee

At the Permaweb 1.0 launch event, incubator Forward Research announced the acquisition of Odysee, the largest video-sharing platform in Web3, with 7 million monthly active users. This acquisition not only brings considerable traffic to the Arweave ecosystem but also signifies the "rebirth" of Odysee. Odysee will be rebuilt as a ContentFi application on Permaweb, creating a new content economy.

Image Source: Community Labs

ContentFi applications rely on atomic assets, a new type of NFT paradigm on Arweave. Unlike mainstream NFT standards, atomic assets store data, metadata, and smart contracts on Arweave, all under a single Arweave transaction ID. Additionally, the Universal Data License (UDL) protocol can attach "license tags" to any atomic asset, allowing creators to set personalized usage terms for their content uploaded to Arweave.

Based on AO, all atomic assets follow a unified data standard, allowing them to circulate flexibly within Permaweb. For example, they can be sold on the BazAR exchange or used for secondary creation in other applications to extend content value. This marks the beginning of Permaweb's exploration of a new content economy, maximizing content value for both creators and ordinary users.

Expanding DeFi Boundaries with AgentFi

AgentFi, also known as Autonomous Finance, is entirely driven by AI and will push DeFi to a new stage of development. Unlike traditional DeFi applications, AgentFi creates AI agents to automatically execute intelligent trading strategies. Arweave provides AgentFi with a reliable, durable, and diverse data storage platform, enabling AI agents to access and analyze high-quality data for intelligent and autonomous financial transactions. AO offers powerful data processing and computational capabilities, allowing AI agents to adapt to market changes and optimize trading strategies.

Autonomous Finance is an organization focused on promoting financial infrastructure, AgentFi, and ContentFi applications on Permaweb. Its products include AOLink (AO blockchain browser) and DataOS (ContentFi protocol). Recently, it launched an autonomous DCA agent application and an autonomous financial data platform, Dexi, beginning the exploration of AgentFi applications.

Release of the AO Whitepaper: Unveiling the $AO Economic Model

AO is currently in the testnet stage and has previously released the Spec (protocol specification) document, describing AO's core functions, architecture, working principles, and protocol specifications. On June 13, AO whitepaper was published, "The AO Protocol: A Decentralized Open-Access Supercomputer." Building on the Spec document, the whitepaper introduces essential elements such as the security model, economic model, and token minting mechanism.

The innovative design of AO's economic model achieves efficient allocation and pricing of security resources through a dynamic staking market, staking lock-in period, and economically reasonable security pricing and market equilibrium mechanisms. This mechanism not only enhances network security but also reduces overall operational costs through customized security measures. Detailed content can be found in the AO whitepaper. To ensure long-term stable operation, the economic model incorporates the native $AO token to incentivize network participants to maintain and enhance network stability and efficiency. Below are the specifics of the $AO minting and distribution mechanisms.

$AO Minting Mechanism

The AO token's minting mechanism is uniquely designed to ensure long-term value and scarcity. The specifics are as follows:

The minting mechanism began on February 27, 2024 (retroactively), and all AO tokens minted during this period are allocated to Arweave token holders. As of June 13, 2024, 1.0387 million AO tokens have been minted.

$AO Distribution Mechanism

The AO token distribution mechanism aims to balance various interests, ensuring long-term network stability and development. The specifics are as follows:

Currently, bridged assets only support stETH from the Ethereum network, but will gradually include SOL and other yield-bearing assets in the future. According to the latest Dune dashboard data, stETH assets deposited into the AO network exceed $440 million, involving about 1,900 addresses. Based on the earnings from bridging assets, the AO network supports ecosystem development through a permissionless funding mechanism and the Permaweb Ecosystem Development Guild (PEDG). Developers and startups can use these funds flexibly to drive project growth.

Additionally, AO tokens will remain locked until approximately 15% of the supply is minted, estimated to be around February 8, 2025.

AI on AO Launch Event: Supporting the Operation of Large AI Language Models

AO made several significant announcements in June, including key advancements in AI technology, breaking through the WebAssembly 32-bit limit, simplifying Arweave data access, and creating an optimal environment for running large AI models on-chain. These include:

These three technological breakthroughs enhance application performance and promote development flexibility and technological innovation. As an application example, the event introduced a new fully AI-driven project, Llama Land. Another decentralized GPU network project, Apus Network, aims to provide the most cost-effective AI model execution environment for AI applications on AO.

Two Important AI Projects: Llama Land and Apus Network

Llama Land is a fully on-chain, AI-driven massive online multiplayer game built on AO. In this virtual game world, Llama Land features a system similar to the Federal Reserve, Llama Fed, operated by the Llama model, responsible for monetary policy and minting Llama tokens. Users can request Llama tokens by providing Arweave tokens (wAR), and Llama Fed decides whether to grant tokens based on the quality of the request, with no human intervention.

As the number of AI applications on AO increases, so does the demand for computing power. Apus Network, as a pioneer, is the first to launch on AO.

Apus Network is a permissionless decentralized GPU network. Combining Arweave's permanent storage and AO's scalability, and through its economic incentive mechanism, Apus Network provides a deterministic GPU execution environment for AI models, further promoting decentralized AI development.

The New Landscape of the AO Ecosystem: Project Migrations and Emergence

Image Source: everVision

In nearly five months since its launch, the AO ecosystem has seen rapid development, with new projects emerging almost weekly. The AO ecosystem now encompasses 13 sub-sectors, with over 60 projects. In addition to new AO-native projects, established Arweave projects have also migrated to the AO ecosystem, bringing mature products and technologies that can quickly take root and improve the environment for new projects.

Migration of Established Arweave Projects

Financial protocol everPay and decentralized exchange Permaswap, under everVision, have both completed AO architecture adaptation, supporting both Arweave and AO versions. The everVision team also developed the cross-chain bridge project AOX, currently supporting asset circulation between Arweave and AO networks, with plans to integrate more blockchain networks in the future.

AR.IO, an established decentralized gateway project in the Arweave ecosystem, recently announced the completion of its AO migration after a month of work. The AR.IO team developed the AO Ecosystem Domain Name System ARNS and launched a test token $EXP.

Decent.land, a decentralized social protocol in the Arweave ecosystem, developed the EVM-compatible computing network WeaveVM and facilitated the bi-directional integration of MEM (Web3 serverless computing platform) and AO. Additionally, by combining its cross-chain bridge Molecular Bridge and indexing tool elciao, Decent.land has enabled asset interoperability between EVM chains and the AO network.

BazAR Exchange also announced its migration to AO, building a new AO atomic asset ecosystem with the UDL protocol and optimizing the Helix tool, making it easy for users to upload and customize atomic assets.

Emergence of New Projects

In my previous articles, "Initial Glimpse of the Ecosystem: Highlights a Month after the Launch of the Parallel Supercomputer Arweave AO" and "Wealth Effect Emerging! Two Months after the Launch of the Parallel Supercomputer AO: Network Activity Soaring, AI Agent Financial Infrastructure Leading Ecosystem Blooming," I detailed new projects in the AO ecosystem up to June. The following content focuses on recent project developments.

June was a busy month. Community Labs launched the lending protocol LiquidOps, completing the DeFi trio in the AO ecosystem along with the decentralized exchange Bark and the stablecoin protocol Astro. Meanwhile, everVision introduced the concept of FusionFi, aiming to make Permaswap the unified financial protocol on Permaweb, supporting various financial services in the future.

In terms of AI applications, besides the previously mentioned Llama Land and Apus Network, Autonomous Finance also launched the decentralized autonomous financial data platform Dexi. Similar to DEX Screener, Dexi provides important financial information such as historical prices, buy and sell orders, and liquidity, while also monitoring autonomous AI agents.

ao builders launched a new game, Cyber Beavers, with gameplay similar to "Brawl Stars." Players can earn CBCcoin by mining and killing, and the last survivor wins all CBCcoin. The AO game distribution platform AO GAMES also recently launched Protal Engine v1.0, providing a standardized game development framework, facilitating game development and migration. Several AO-native games will be launched in August.

Establishment of the AO Ecosystem Foundation, ao ventures Hosts Demo Day

SevenX Ventures, in collaboration with everVision and BuidlerDAO, launched a $10 million AO ecosystem fund to invest in and incubate early-stage projects within the AO ecosystem, accelerating ecosystem development. everVision will provide technical support to help projects develop within the AO ecosystem, while BuidlerDAO will organize hackathons and accelerators to lower the entry barriers for developers and entrepreneurs.

Previously, ao ventures completed a $30 million funding to support ecosystem application development. The recently concluded 10-week incubation program attracted over 100 developers, with more than 30 project submissions, ultimately selecting 11 projects to participate in Demo Day, indicating a new batch of applications will soon join the AO ecosystem.

Conclusion

For the AO ecosystem, June 2024 can be regarded as a "golden month". The AO network continues to develop rapidly and has formed a vibrant ecosystem. In addition to strong growth momentum, AO has made several major announcements over the past month.

Following the launch of AO, the landscape of Permaweb has changed, with limitless possibilities for application development. In the Permaweb 1.0 phase, two main directions were conceptualized: ContentFi, enabling content monetization and free circulation, and AgentFi, combining AI technology to achieve autonomous agent finance.

The issuance of the AO native token, though not yet in circulation, heralds the imminent launch of the AO mainnet. The token economic model ensures the long-term interests of AR holders and maintains the security and stability of the Arweave system. Additionally, incentive mechanisms attract external funds, injecting growth momentum into the AO ecosystem.

As a permissionless parallel supercomputer network, AO, despite its youth, has significant performance advantages. It has also achieved key breakthroughs in AI technology, supporting the operation of large AI language models, further expanding the boundaries of application development. The future potential of AO is indeed intriguing.

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