We're obsessed with the shiny new toys of AI: the image generators spitting out fantastical landscapes, the chatbots engaging in surprisingly coherent conversations. What about the pipes under which the water flows? Just as importantly, what about the wires that transmit it? These decentralized compute networks and their related tokens are fueling the AI Revolution. I think we are making a gigantic mistake by underplaying their importance.

AI's Plumbing System Severely Undervalued?

Think of it like this: everyone's marveling at the skyscraper, but nobody's paying attention to the foundation. We are wowed by the shiny use cases of AI. Throughout all of this, we fail to consider the enormous computational resources that go into training and deploying these models. While all the attention is going to the centralized provider of GPU compute, CoreWeave, with their mind-blowing valuation of $79.2 billion. All the while, decentralized compute networks are hiding in plain sight and getting dangerously underrated.

I'm not saying CoreWeave is worthless. They're providing a crucial service, no doubt. And to be fair, their current valuation is hardly grounded on current profits or existence even as their current ‘model’ isn’t truly profitable. And yet, they announced a $314.6 million net loss during the first quarter! On the other hand, decentralized networks such as Akash Network (ATH), Render Network (RNDR), and Bittensor (TAO) are already up and running. They’re tapping into existing GPUs and plugging them into the end user, running real production workloads and doing it all with a model that is much more capital-efficient. They don’t have to port everything out to huge, costly data center server factories.

The entire market capitalization of all decentralized compute tokens is around $12 billion. That's less than 1/6th of CoreWeave's valuation. Does that sound right to you?

Irrational Exuberance or Rational Neglect?

This reminds me of the dot-com boom. Here’s the thing – everyone was throwing billions at internet applications (pets.com, anyone?), and completely ignoring the infrastructure that made it all possible. You know who won, though? The companies that actually got the fiber optic cable laid. Ultimately the winners were all the players who constructed and operated the data centers. Are we setting ourselves up to make the same mistake with AI?

We see "irrational exuberance" towards GameFi tokens, which have low usage but very high values, and undervalue distributed compute tokens.

Decentralized networks offer several key advantages:

  • Resilience: No single point of failure.
  • Accessibility: Democratizes access to compute power.
  • Efficiency: Utilizes existing resources, reducing waste.
  • Innovation: Fosters open-source development and experimentation.

The future of AI is likely to be dominated by a few centralized, private AI providers. Now, THAT thought is actually terrifying! What happens when they begin censoring information, limiting overall access, or charging exorbitant costs. That’s why a decentralized compute infrastructure is key to keep AI development free and open for business.

The Social Signal of Decentralization

Here's where it gets interesting. If you love decentralization, support open-source technology, and are afraid of concentrated power, now is the time to speak out. You need to be shouting from the rooftops to demand compute tokens! When you invest in these tokens, it’s not just an investment to make you money, it is signaling your values. It’s about creating a future where AI is a tool for all — not just the large, controlling mega-corporations.

Imagine SRM Entertainment (soon to be TRON Inc.) staking their whole treasury of 365 million TRX tokens. They're trying to generate a return, sure, but they're making a statement. By doing this, they’re positioning themselves with a short-sighted vision of the future. In the same vein, Sogni AI launching their mainnet and SOGNI token listing signal their shared commitment to decentralized generative AI workflows.

The question is this: Are you going to be part of the foundation, or just another spectator admiring the skyscraper? The opportunity, and the potential rewards, await you.