Akash: the intersection of Crypto and AI
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Akash is an L1 built on the Cosmos stack which acts as a marketplace for computing resources (or decentralised cloud). Demand-side participants submit their desired price and supply-side participants compete for the business which can result in in lower prices than other cloud systems. Historically they have been focused on building a decentralised alternative to centralised public clouds (read this Messari report for more background), but with the introduction of Akash AI this focus has turned to the AI marketplace. A marketplace with AI models hungry for compute on one side and GPUs on the other. The team plan to bootstrap supply from various sources including institutional PoW miners which could be an interesting segment to focus on given Ethereum’s recent transition to proof of stake, the founder goes into the other sources here.
They recently ran a successful incentivised GPU testnet; “testing the first open-source cloud for open-source GPUs and AI by providing GPUs, defining deployment specs, deploying AI models, and benchmarking GPU performance” with participants being rewarded for different tasks. Their marketplace allows users who want to run AI models to get access to powerful GPUs (difficult to get elsewhere) while allowing a massive network of idle GPUs to be utilised. The development company Overclock Labs, have already successfully tested on an internal testnet and will be building a front end for Akash AI themselves and verticalise the product. With these successful pilots complete, the team are now looking towards a mainnet in the near future.
AKT is the native token and is used as a POS staking token with a 21 day unbonding period (used as gas and inflates at 8% to reward stakers), the unit of payment in their marketplace and as an incentivisation method. Currently 68% of circulating supply is staked. The end game model is to charge a “take fee” for every successful lease which would be distributed to holders. The take fee is provisionally set at 10% for AKT transactions and 20% when other tokens are used. Given this take rate is not yet live, the protocol fees are currently extremely low. It is speculated that fees and other changes including stable payments will be implemented in the upcoming mainnet. The initial token allocation was 100 million AKT:
All of the above tokens are fully vested (see schedule here). With roughly 55% of supply circulating the remaining tokens come into circulation via inflationary staking rewards until 2030, this inflation is to be dynamic over time with a max of 15% and a minimum of 5%.
We see Akash as a much earlier (and therefore cheaper) competitor of Render Network (read more here). Given the AI vertical, the potential upside for AKT is huge should the team execute and find product market fit. We will be monitoring the mainnet launch closely.