What is ai16z? Eliza Framework & Tokenomics

What is ai16z?

ai16z is an AI agent and crypto fund managed through a Decentralized Autonomous Organization (DAO). While ai16z is unaffiliated with Andreessen Horowitz (a16z), the name serves as a witty reference and an indicator of clever branding strategy from the founders.

ai16z is powered by ElizaOS, an open-source framework for building and deploying AI agents called "elizas." These agents perform tasks across social media platforms like Discord, X (Twitter), and Telegram, including reading links and PDFs, summarizing, and interacting with users.

Additionally, ai16z's agents extend far beyond social engagement, with practical applications like Marc AIndreeson, trained to provide investment insights, startup advice, and guidance, based on the thinking and philosophy of venture capitalist and a16z's co-founder, Marc Andreessen.

With over 95,000 token holders, a $1.7 billion market cap, and a 6.22% mind share in AI agents, ai16z is a top competitor to Virtuals Protocol and aiXBT. The $AI16Z governance allows token holders to influence decisions through a trust engine where recommendations are weighed based on performance.

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How Does ai16z Eliza Work?

Eliza allows anyone to build fully functional AI agents, similar to ai16z, in just 15 minutes. Eliza's multi-agent simulation framework makes the complicated process of creating agents (like Degen Spartan AI) simpler with user-friendly tools and templates:

• Build Personalities in Minutes: Start with pre-made character templates that define an agent's personality, tone, and behavior, or customize your own with simple edits.
• Smart Memory and Conversations: Eliza remembers past interactions, using advanced tools to provide personalized responses and meaningful context for long-term discussions.
• Simple Platform Integration: Whether it's Discord or X, Eliza connects your agents to where the audience is, ready to chat, share, and engage effortlessly.
• Extensive Use Cases: From community moderation to content creation and even role-playing, Eliza adapts to your needs with flexible features and rich capabilities.
• Deploy Anywhere with Ease: Get your agents running locally or in the cloud, with support for advanced setups like secure environments or decentralized platforms.
• Smart Contract Functionality: More tech-savvy creators can add onchain capabilities to their AI agents, letting them execute swaps and DeFi interactions on Solana, or EVM chains.

If you're interested in the technical know-how, a16z's recently published 20-page whitepaper covers runtime optimization, blockchain data manipulation, smart contract interaction, context-aware agent design, and the integration of secure execution environments.

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What is daos.fun?

daos.fun serves as the backbone of the ai16z fund, providing a decentralized platform on Solana for fundraising, trading, and profit-sharing while offering governance rights and liquidity options to token holders.

• Fair Launch Fundraising: A one-week funding period lets contributors buy tokens at a fixed price, with refunds available if the goal is unmet.
• Strategic Investments: 90% of funds are allocated to Solana protocols, while 10% is used to create a locked liquidity pool for trading on an AMM.
• Profit Redemption: After the ai16z's fund expiration on October 25, 2025, token holders can redeem underlying assets or trade tokens on the curve.
• Governance Control: A voting module will empower DAO members to mint tokens, raise funds, or permanently burn mint authority.
• High APR Liquidity Rewards: Staking in the ai16zPOOL currently offers a 31.39% APR, with liquidity exceeding $4.6 million.
• Verified Creators: Gold checkmarks distinguish trusted creators, enhancing transparency and user confidence.

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AI16Z Tokenomics

The $AI16Z token was launched on the Solana blockchain in October 2024. It has a current circulating supply of approximately 1.1 billion tokens, distributed between 95,000+ holders. As of now, the top 30 wallet addresses hold 42.88% of the whole token supply.

The project is undergoing a tokenomics overhaul to address its native token's undervaluation and ensure its long-term viability. This update focuses on integrating secure mechanisms that capture value from the widely adopted Eliza framework:

• Launchpad: Launching in Q1 2025, the Eliza-based platform will tokenize and launch AI projects, with fees and liquidity pairings driving $ai16z value through buybacks and burns.
• Incentivized Participation: $ai16z staking unlocks early project access, fee shares, and governance rights, while ecosystem funds reward developers for impactful contributions.
• Treasury Optimization: Diversified investments in major tokens and stablecoins will stabilize the DAO treasury, funding liquidity support, buybacks, and potential airdrops.
• Token as a Core Asset: Positioning $ai16z as the primary currency for agent-to-agent (A2A) transactions, aligning all projects within the decentralized AI ecosystem.

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ai16z vs Virtuals Protocols

The battle for dominance in the AI agents sector has intensified, with AI16z and Virtuals Protocol contending for the top spots. Below we look at their key similarities and differences.

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Similarities

Both AI16z and Virtuals Protocol are at the forefront of the AI agent trend, providing platforms for building, deploying, and interacting with intelligent agents.

Each protocol offers advanced tools for AI agent creation; AI16z through its Eliza framework and Virtuals via its GAME framework, emphasizing functionality, user engagement, and adaptability.

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Differences

Virtuals Protocol tightly integrates its $VIRTUAL token into all platform activities, ensuring value accrual with each transaction. In contrast, AI16z’s Eliza framework is open-source, allowing unrestricted use but with weaker direct ties to the AI16z token.

Virtuals Protocol uses a centralized platform, curating high-quality projects with stringent standards. On the other hand, AI16z favors a decentralized and collaborative environment, relying on community creativity without imposing strict ecosystem controls.

AI16z empowers developers by providing a flexible, permissionless framework, encouraging experimentation. Meanwhile, Virtuals maintains a more curated approach, prioritizing fewer but higher-quality projects like AIXBT, VADER, and LUNA.

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Founder

Shaw (@shawmakesmagic on X) is the founder of Eliza Labs, the company behind ai16z and Eliza. His background includes years of work in open-source AI and machine learning, where he collaborated on agent-driven systems before integrating token-based incentives in the crypto space.

Shaw wants ai16z to provide average individuals access to the kind of high-value, network-driven investments traditionally reserved for elite venture capitalists like a16z, enabling exposure to early-stage innovation.

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Final Thoughts

ai16z represents a unique intersection of AI and decentralized finance, democratizing access to advanced AI tools and innovative investment opportunities.

As new narratives like DeFAI gain traction, ai16z stands out as one of the projects that could potentially expand its onchain functionality to allow for more complex tasks such as lending and yield farming.