Table of contents

  1. Key Takeaways

  2. background

  3. Overview

  4. Industry Outlook

  5. argument

  6. catalyst

  7. in conclusion

  8. references

  9. Disclaimer

The price of Akash ($AKT) has increased more than 15x since the beginning of the year, with the token being one of the biggest beneficiaries of the AI ​​narrative, outperforming the market as a whole, accumulating a market cap of $26.7 billion.

With NVIDIA set to report earnings later this month, the AI ​​narrative shows no signs of slowing down and Akash could also benefit from this, with its valuation expected to approach that of current leader Render ($RNDR).

Source: kaito.ai - AI currently accounts for over 25% of the overall narrative market share.

The upcoming $IO token launches at a higher valuation, which undoubtedly provides additional tailwinds given that the majority of $AKT supply is already in circulation and trading at a fully diluted valuation (FDV) of $1.1 billion. For context, IO Research recently announced that it had raised $30 million in a Series A round backed by Hack VC, Multicoin Capital, and others, with a pre-launch valuation of $1 billion. Meanwhile, pre-launch OTC markets like Whales Market indicate an initial market valuation of $2 billion and an FDV of over $3 billion.

In addition to this, there are some rumors on the community forum that OpenAI may announce the launch of a search engine to compete with Google. This was also reinforced by Jimmy Apple, who revealed the news as an insider. According to him, the plan is tentatively scheduled to be launched on May 9th.

Key Takeaways

  • $AKT has risen 15x year-to-date, demonstrating the market’s strong confidence in it and alignment with the AI ​​narrative.

  • Akash is expected to benefit from exchange listings and improved liquidity conditions, which could narrow the current valuation gap with $RNDR.

  • External catalysts such as new token launches increasing competition, Nvidia’s earnings report, or OpenAI’s announcement could trigger a reassessment of the entire AI x crypto market sector.

  • Unlike new entrants, Akash has a proven track record and is able to leverage cryptoeconomic incentives to perform regulatory arbitrage — something that Web2 competitors cannot achieve.

background

Akash was co-founded by Greg Osuri and Adam Bozanich. Greg is known for his expertise in cloud infrastructure and contributions to open source frameworks. Co-founder Adam has a solid software engineering background and extensive experience working with distributed and decentralized systems.

Akash insists on building in the open and promoting the spirit of open source, so that regardless of market conditions, Akash continues to grow, with more than 400 contributors and an average of more than 60 code commits per week. For example, the Akash community deployed Llama 3 within hours of its release and made it available to the public for free through Akash Chat without the need for permissions or subscriptions.

Source: Akash-Network organization on Github.

More than 70% of the supply is allocated for mining rewards, although investors can access 10% of the initial supply. A private round led by Digital Asset Management (DACM) was held in March 2020, when 8.7% of the supply was sold (for a period of two years, with 50% unlocked after 12 months), raising $2 million at a price of $0.0591 per share (78x ROI). In addition, an initial coin offering (ICO) in October 2020 helped Akash raise $800,000 from token sales at an ICO price of $0.35 per share (13x ROI).

Overview

Akash is a decentralized marketplace for buying and selling computing power. Often referred to as the "Airbnb of computing", Akash is built on the Cosmos SDK and connects suppliers and consumers through a bidding process without intermediaries.

The network uses the Stack Definition Language (SDL) to specify workloads, allowing users to competitively bid on-chain. In return, providers submit proposals, allowing users to select the most appropriate option for their specific computing needs.

Users and developers can access Akash through brev.dev, which simplifies the process of finding and configuring GPUs or CPUs. As a single interface for various cloud services such as Amazon Web Services (AWS), Google Cloud Platform (GCP), and Fluidstack, developers can choose computing instances based on cost and availability.

Source: Akash Statistics - The number of active leases has risen sharply since the beginning of the year.

Through the Akash console, users can browse the market and deploy instances with a few clicks, with payment methods supporting $AKT or $USDC. Institutional investors can also participate, thanks to Coinbase Prime's custody support for $AKT.

The network has proven its resilience after running for over 3 years without any downtime, and Akash is currently the cheapest decentralized supply network for A100 and H100, which are the lifeblood of AI.

Source: Akash Pricing.

Akash has successfully completed the first base model training, and now anyone can start building on it at industry-leading prices (as low as $1.50 per hour for H100s).

Industry Outlook

Since ChatGPT was released, we’ve often heard that “GPUs are the new oil” and that “computing will be the currency of the future.” While many startups are now jumping in, Akash has been leading the way on this idea for more than five years.

This foresight is now being validated as GPU shortages continue to pose challenges, highlighting the importance of decentralized solutions and peer-to-peer marketplaces in meeting the exploding demand for AI computing power.

In a market where demand for AI processing power far outstrips available supply, the ability to provide broad and scalable GPU resources is critical. This is a clear market opportunity that multiple startups have already begun to address, both in centralized and decentralized ways.

From a market sector perspective, multiple Akash clones have raised funding in the private markets at eye-popping valuations. However, data shows that Akash remains a strong contender most likely to eventually become the market leader, as they have years of experience and track record of innovation in this space.

In the crypto space, we can clearly see the valuation gap between Akash ($AKT) and Render ($RNDR), the latter being the largest token by market cap. As an industry, crypto places a heavy emphasis on liquidity, which explains why tokens like $RNDR may trade at a premium. This tells us that the speed at which $AKT valuation re-rates will be highly dependent on CEX listing, which plays a key role in market accessibility.

argument

In addition to being at the intersection of crypto and AI, Akash is also a DePIN project as it aims to decentralize the provision of physical hardware infrastructure through token incentives. This is becoming increasingly important as thought leaders like Zuckerberg have expressed their concerns that when you scale up data centers, you run into issues like excessive energy consumption, which requires government intervention due to regulatory issues.

Peter Thiel once said, “AI is centralizing, crypto is decentralizing.” Cryptoeconomic incentives, such as DePIN, reinforce this point. Zuckerberg’s concerns are actually a boon for decentralized networks like Akash, as they spread the computational load and reduce reliance on large, single, energy-hungry data centers. Furthermore, in the spirit of permissionless operation, blockchains operate in different regulatory environments, opening the door to opportunities in the form of regulatory arbitrage.

Furthermore, decentralized networks for AI can facilitate diverse data generation from multiple sources without the need for central control, adding more layers of security and traceability, ensuring the integrity and verifiability of the data used.

catalyst

As more competitors enter the market with their tokens targeting multi-billion dollar valuations, we see this as a positive for Akash, especially as investors do their due diligence and details continue to emerge. Martin Shkli recently went on a Twitter spree highlighting that io.net GPU numbers may be artificially inflated.

Actual token issuances from new projects will likely use $RNDR and $AKT as benchmarks to estimate their FDVs. If the valuation of new issuances exceeds that of $AKT, this could quickly trigger a rapid repricing of the latter, especially since it has a proven track record.

Prior to Consensus 2024, there will also be an “Akash Acceleration Summit” taking place on May 28. This will be the first full-day Akash Summit and will feature presentations and panel discussions from influential people in the decentralized AI space.

Any breaking news from OpenAI could also drive up prices of AI-related tokens.

Source: Coingecko $AKT - Despite showing a very strong uptrend on the YTD timeframe, the price of $AKT has been fluctuating between $4 and $6.

Ultimately, $AKT is a token that has historically shown large price swings when listed on exchanges, which is consistent with our view that there is a liquidity premium in crypto - the more exchanges you are on, the better it is for your token. The Upbit listing led to a 47% price increase, and Coinbase also announced the listing of the token two months ago. What is currently missing is the final push of a listing on the Binance exchange, which could further close the valuation gap with Render.

in conclusion

$AKT sits at the intersection of crypto and AI, while also being active in the DePIN space, and is well-positioned to capitalize on two narratives that have dominated the market since the start of the year.

With multiple catalysts in place, $AKT can become one of the fastest-growing tokens in the AI ​​token rally ahead of new token launches, OpenAI news, or positive NVIDIA earnings. Exchange listings and greater awareness of Akash’s track record and moat could further accelerate the re-rating process, assuming the heat in the AI ​​space doesn’t cool down.

References

  • Website

  • Akash Console

  • Akash (X)

  • Akash Network Organization (Github)

  • Akash Network Stats

  • Akash Pricing Calculator

  • Akash Network Token and Mining Economics

  • Akash Network Economics 2.0

  • Greg Osuri (X)

  • Cloudmos.io

  • brev.dev

  • Akash Accelerate

  • Marc Zuckerberg Interview on AI

  • VanEck’s Crypto AI Revenue Predictions by 2030

  • Galaxy Digital: Understanding the Intersection of Crypto and AI

  • Grayscale on the Emergence of AI and Crypto Synergies 

  • $AKT (Coingecko)

  • AI Tokens (Coingecko)

  • Fundraising (drop stick)

  • Akash Network Statistics (Artemis)

  • $AKT Token Unlocks

Disclosures

We have never had any business dealings with Akash and this report was not paid for or commissioned.

Members of our team, including those directly involved in the analysis above, may hold positions in the tokens discussed.

This content is for educational purposes only and does not constitute financial or investment advice. You should do your own research and only invest what you can afford to lose. We are a research platform, not an investment or financial advisor.

Source of this article: Revelointel