Staking coming to SingularityNET (AGI) in March

SingularityNET (SNET) is an open and decentralized network of AI services made accessible through the blockchain. Developers publish their services to the SingularityNET network, where they can be used by anyone with an internet connection. Developers are able to charge for the use of their services using the native AGI token.

Staking coming to SingularityNET (AGI) in March

The SingularityNET team has been hard at work creating the first robust, scalable, general-purpose decentralized AI platform – and, as announced in a recent roadmap update, the first half of 2020 is going to be the most exciting phase yet in the growth of the project.

Over the next few months will see the launch of mobile SDKs, an AI Publisher portal making it easier to put new services on the platform, a number of spinoffs and advanced research projects leveraging the platform reach maturity, and much more – including the advent of AGI token staking, a key aspect of the SingularityNET ecosystem whose time has finally come.

Staking will begin in March 2020, and the particulars of the staking process and model will be elaborated in a series of blog posts, mostly to be published in February. This initial post in the series simply explains what kind of staking SingularityNET is launching, with what objectives in mind. Later posts will outline the quantitative parameters, and provide how-to information for those who wish to stake their tokens.

The Fiat-to-Crypto Gateway

One role of staking in the SingularityNET platform ecosystem is closely tied to the fiat-crypto gateway – a collection of software processes that, all together, allow users to optionally interact with AI providers and users on the platform entirely using fiat currency rather than AGI tokens.

Setup for the first half of the fiat-crypto gateway – automated fiat-to-AGI conversion for platform usage – is already in place, at least in initial form. The PayPal interface to the platform allows users to purchase AI services from providers using their PayPal wallets. As PayPal wallets are easily filled using fiat currency, this allows payment via fiat for service users on the platform.

Of course, PayPal as a particular service has its limitations in terms of cost and jurisdiction, and the SingularityNET team has plans to augment it with other fiat-to-AGI methods. But given PayPal’s huge user base, the PayPal interface is a solid start.

The second half of the fiat-crypto gateway is planned for June 2020, and will enable AI service providers to be paid in fiat instead of AGI tokens. With this SingularityNET will be able to fully participate, as an end-to-end system, in the conventional fiat currency economy as well as in the crypto economy.

This is critical for the platform’s success as an alternative to the Big Tech AI ecosystem, because at the present time most providers or users of AI services don’t have crypto wallets and are not strongly motivated to enter into the crypto ecosystem.

“We are big believers in blockchain and cryptocurrency, obviously, and would like to see more and more of the world economy shift away from fiat and toward decentralized, democratically governed mechanisms for transmitting and storing value. However, we also need to be practical – and we want to grow SingularityNET as an AI platform as fast as we can, without this growth being dependent on the speed with which cryptocurrency pervades the mainstream of the business and research worlds.”
– The SingularityNET Team

Even with the full fiat-crypto gateway in place, all value exchanges between AI services and their users on SingularityNET will take place, on the back end, using AGI tokens.

However, from the view of a user who pays and is paid for their SingularityNET network activity using fiat, the existence of AGI on the back end is pragmatically irrelevant – much as someone doing an international wire transfer at their bank today doesn’t need to know about the internal mechanics of SWIFT codes and government security checks and such.

Why the AGI Token Needs Staking

To make the fiat-to-crypto gateway work, on the back end, requires the operator of the gateway (i.e. SingularityNET Foundation or some entity it nominates) to engage in continual exchanges of fiat currency for AGI tokens. This is obvious, as when a user pays for a certain AI functionality in fiat, this fiat needs to be turned into AGI for paying the AI agent providing that functionality; and when a provider requests payment in fiat for the functionalities their AI agents have provided to users, the AGI that these agents have received as payment need to be turned into fiat.

Doing all these exchanges, in practice, requires some “liquidity pool” of AGI tokens that can be provided in exchange for fiat as needed. That is, whoever is in charge of doing the fiat-to-AGI and AGI-to-fiat exchanges needs to have some AGI tokens and some fiat currency on hand, so that when someone needs to change AGI for fiat, it has the fiat; and when someone needs to change fiat for AGI, it has the AGI.

Staking is an elegant way of securing an additional pool of AGI tokens usable for mediating the exchanges this gateway requires.

When an AGI token holder stakes their tokens, this means they are agreeing to “lock-up” and not use their tokens for a period of time. They are temporarily handing over their tokens to the Foundation that is managing the staking process – until they request the tokens back.

These staked tokens are then part of the pool that can be used to mediate the fiat-to-AGI exchange required on the back end of the fiat-crypto gateway.

In exchange for providing their tokens to be used in this way, the AGI token holder who has staked their tokens is provided with a certain number of bonus AGI tokens, depending on how many tokens they’ve staked and long they’ve staked them for. Other rewards for staking may also be introduced.

For the AGI token owner who has bought tokens in advance of needing to use them for purchasing AI services, the tokens they own are typically not providing any immediate value until the owner decides to pay them to some AI agent to obtain some service. The tokens are just sitting around in a wallet for the time being. So staking the tokens provides a way to obtain some short-term value from the tokens – the staking bonuses – while holding onto them and waiting for the right time to use them.

The initial quantitative parameters of the AGI token staking process, and the practical procedures to follow for staking your tokens, will be covered in later blog posts in this series. But hopefully here, it has been made clear how AGI token staking will work on a general level, and what role it will play in the rapidly evolving SingularityNET ecosystem.