Yat Siu on memecoins, TON and the rise of AI agents

In the latest episode of the Blockchain Gaming World podcast, editor-in-chief Jon Jordan talks to Animoca Brands’ chairman Yat Siu about key blockchain trends, ranging from memecoins to the rise of Telegram and TON, as well as how AI agents could shake up the meta in 2025.

When we spoke a year ago we mentioned memecoins, which became one of the big trends in 2024. How do memecoins relate to what Animoca Brands is doing today?

Yat Siu: First of all, we’re optimistic about memecoins generally, and we’re fairly involved in certain aspects of them. For instance, we invested in companies that are basically building games on memecoins, such as the Shiba Inu ecosystem. I look at memecoins as a distribution network as well. It’s kind of like the new app store.

When you think about what a token is, it’s a representation of a network effect, they represent community network effects. And if you are able to attract the attention of large meme communities, then you have a product. That’s one example. 

The other one, of course, which was a very big launch at the end of last year was PENGU. We’re investors in Igloo and involved in the launch of PENGU. It has, I would say, the best utility amongst memecoins. 

To me that’s interesting because it may start off as a meme coin or a memetic in nature, but then later on, its narrative becomes its utility. When you look at NFT collections launching tokens, actually, they are memecoins. Or now, what’s happening is that memecoins themselves, in order to deepen the network effects of their communities, are launching NFTs of their own. 

So you see this classic cycle that’s happening because they’re all cultural in nature. 

I’m bullish about memecoins because they’re narrative indicators of what is actually popular. Memecoins is an open market – Polymarket without being Polymarket. 

For example, my daughter was talking to me about Chill Guy. And I’m not really on TikTok so normally I would have no idea what Chill Guy is. But I had heard about Chill Guy because of the memecoin, not because I hang out in TikTok. 

Now, AI agents are actually memetic in nature as well. We are narrative, storytelling creatures. As a community, we live on stories. You could argue that money is a story, democracy is a story, politics is a story of some sort. Then we find a common consensus. 

And what is a meme? A meme is one that we agree with each other. The memetic nature is that you agree and I agree that this is cool and if a million people agree then it becomes a more popular meme. 

Clearly there is a gambling aspect, a speculative asset that ties into this world. We shouldn’t forget that. But the energy that goes into that can only really happen when the community agrees that this is a meme worth pushing.

PENGU is an example of a very well orchestrated meme that is entering meme territory, but wouldn’t normally be classified as a meme in terms of the way that it was launched. 

However we do have to be careful about how these tokens launch. Even so-called fair launches on Solana are not fair launches because snipers are out there basically sniping the market. You have to be mindful of how you launch, it’s not as easy as just launching a token. Of course, if the token doesn’t go in the hands of the community, but in the hands of snipers, then you destroy the construct and you harm the reputation of whatever meme that you’re trying to put out. 

VCs have very much value in the space because VCs, to some extent like ourselves, are willing to lock ourselves up. We’re willing to look two-three years down the road, once the ecosystem is built up, then we will have some releases and we’ll do something. That’s what we’re doing as opposed to the so-called fair launches that actually end up in the hands of people that just want to dump on you. That’s the part that makes me a bit more negative on memes, not because they’re not powerful and important, but because they’re being abused on some level. 

That said, I think I’m bullish about meme coins, especially creating more utility as platforms, as distribution and as icons of web3 culture.

Is PENGU a memecoin? Pudgy Penguins’ headco Igloo is launching its own blockchain Abstract, and it’s got various games based on Pudgy Penguins coming out. As such I don’t think PENGU is a pure memecoin that exists for its own sake.

I would challenge that thought a little bit because it may start off as that, but then the community picks it up and when it’s owned by the community, which is what happens with memecoins, they shape it in their own form and create a culture around it. 

So when people are launching games based on DOGE or PENGU, are we actually talking about the fact that the game is creating utility and therefore that makes the meme community? No, it’s an added utility. We could probably argue that the birth of Bitcoin had a meme nature in terms of essentially as a revolt to the financial system. There’s a meaning behind it. 

Now people do all sorts of things with Bitcoin or Ethereum for instance. This guy’s building a DeFi protocol or this guy’s doing something cool that is unrelated to its original nature. It’s completely changed from what it was since birth. I think that’s why certain memecoins will succeed in the long-term. When you have a certain type of utility embedded, the utility becomes the narrative of the meme itself. 

In other words, look at AI mem coins. What is that? Really it is a memecoin that has an AI narrative. If you want to evolve yourself as a memecoin, you have to be relevant, like fashion. Just being a meme for meme sake can work for some, but won’t work for most. 

Also, we think the institutional era of crypto has come. If you’re an institution buying into tokens, you want to look at something that you can put a plan around. That’s going to be hard if it’s just a memecoin. It’s going to be easier if there’s a narrative to go with it. 

Animoca was quick to pick up Telegram as a distribution method and in 2024 you were actively doing stuff with TON. How do you see that playing out? To me it seems it quickly dampened. 

Firstly, when we got into Telegram in 2023, it was the vision around how to tap into that audience. I would say that vision has proven out and has continued to help companies in terms of getting distribution and reach. Whether it’s Catizen or Gamee and so on, it did literally bring tens of millions of users into the ecosystem. Now, of course, you have the sybil attacks, and that’s where some of the weaknesses of TON have come about, but that’s where blockchain comes as a solution. 

With blockchain, looking at wallets etc, you can start to determine who’s a net extractor and who’s a real user. Eventually airdrops, which is a form of marketing really, has just evolved. 

At the end of the day, Telegram is still the most powerful distribution platform. The issue of course is, it’s harder to determine the quality of the user, but again, because they’re building onchain, you can get better and better at it. 

For instance, Gamee, which was a hyper casual gaming platform on Telegram that reached a lot of users, now has a very sizable advertising business. They’re able to reach real quality users that use the game. In some ways, the game becomes a proof of humanity and proof of action for you to determine whether to pay advertising. It becomes more efficient to advertise on Gamee for a Telegram user than just doing a mass airdrop on TON. 

And that’s what happens now. You’ve got a blockchain, people build and compose new products and services on top and it’ll evolve from them. I’m very bullish on that. 

Secondly, one thing that dampened TON’s narrative was what happened to Pavel (Durov, the CEO) when he got arrested. The drop happened because of that. As far as I know, he is still in France unable to leave, so there is a bit of concern and heavy air sitting around. However, the resilience has proven to me that, TON didn’t go down to one, which is really good. That’s resilience. 

If he does get out and things are settled, I think it’s going to have a huge impact. Why wouldn’t it? I mean, if Trump and Elon have an impact on DOGE, then why wouldn’t Pavel have an impact on TON? 

From an investor sentiment point of view, it’s about confidence. Who are the ones that need this confidence? Well, retail to some extent, but it’s also institutions. If you’re an institutional investor buying a token, you have to justify it. Say TON for instance, with the founder stuck in France, if you’re a fund manager, you have to answer for it. If it doesn’t work out, what’s the downside? It’s pretty big, right? These are factors that come into play. 

But although I think his release will have an impact narratively, the utility of TON is undisputed, and I think it will continue to be so. Toncoin has performed much better than people would have expected considering Pavel has been locked up in France for six months. I guess it’s most interesting that people are starting to launch more sophisticated games rather than just tap-to-earn stuff. 

At the moment, we’re in a very early stage of AI agents. Similarly to memecoins, they may have utility, but not to begin with. Where do you see this going?

Speaking about gaming, it started with the fun, and the fun gave us Nvidia, and now look at that. I think we simply cannot discount why people do whimsical, crazy, silly things, because they lead to some of the greatest breakthrough innovations in history. 

Talking specifically about AI agents, I think the narrative is one thing. A lot of the AI agents are more like Wizard of Oz, where it’s like a little bit mechanized, but it’s getting better and better. When you project into the future, people are actually already working for AIs.

The thing about web3 and AI is so unique that you can’t do it in web2, where AIs interact and generate tokens, which means that an AI can actually pay a human to do stuff, which is already happening in the form of airdrops and activations. When you get more of that autonomous nature, just like the story of DOGE, you’re going to have an AI agent that will have its keys done and it will do some stuff and people will interact with it to receive tokens, and there’s a memetic around it. 

They’ll start working for an AI fully and there won’t be a Wizard of Oz in the back. That’s going to happen. 

I think that captures people’s imaginations. A bit like the metaverse in 2021, it doesn’t mean the metaverse is dead, it just means that it captured people’s imagination in a way and it’s kind of carrying it forward. 

I’m also super excited about how AI is affecting mashup culture in a much more financial way. If you might remember when YouTube launched and people were creating AMVs and mashup videos of anime videos and games and whatever, and they were all saying we don’t like that. You’re gonna stop it. It turns out, that was building communities, and now there can be no such thing as a Hollywood movie without YouTube and TikTok mashups, that are human generated with AI support. 

The amount of times Animoca Brands gets vampire attacked as a brand, for instance AI Monica, or recently where someone was creating an AI around me. I was like, okay, that’s funny, but what they’re astroturfing into our world and our communities, like the new mashup. 

As a business, and it’s for games and any kind of brand, you have to think on what level to interact? It’s like the Chill Guy story. Chill Guy can either say, screw that and fight it, which is not exactly winning, or he can try to embrace it. That’s what we saw with Hollywood and YouTube. They fought UGC and then they just gave up. 

I am also positive about AI agents as a way of onboarding people to web3. In the future we’re not going to be dealing with a wallet in the same way. We’re just going to talk to the agent, they can secure the keys and so on. So I think there’s going to be evolutions happening in this area. 

But I think the big trigger point for AI and gaming is going to be GTA 6. But I don’t think it’s because people are going to say, my goodness, is GTA going crypto. No, no, no, I mean people are going to see the power of what an NPC can do and work and evolve. It’s going to mushroom all these companies. Basically, companies like Virtuals are going to start issuing gaming agents, and it’s going to create a new narrative in gaming AI and gaming in general as well. 

It’ll tilt the entire ecosystem back into gaming again. Gaming is silently growing. We can see the stats, but in terms of getting the sort of mind share it had before, I think will come around the time GTA is getting its hype cycle. 

Finally, Mocaverse is your big thing. The 2024 token launch was very successful, and it’s a solid project. You’re trying to build network effects and ID. How will it evolve?

So a couple of things. At Animoca there’s a couple of strategies. One of the strategies is seeing where the market is going and supporting that. Then we also look at gaps. What are some  things we can do that the ecosystem needs that are not fulfilled? 

For Mocaverse, we’re trying to solve digital identity as the form of having reputation. This mainly came from our experience around TON, where we had all these airdrops and we realized, 80 to 90% is actually civil attacks. 

How do I create the right type of behavior? You basically want to drop to the people that have a good reputation, as we do in real life. In web3, you’re constantly anonymous, which means if you commit a crime you can start afresh somewhere else with zero consequences. We don’t think that makes sense in the long term. 

So how do you create a network that you can trust? It’s very clear, the countries with the highest GDP overall also have very high interpersonal trust. If I know that I can buy something from you and you’re not going to screw me, then that creates less friction on your trade, and that’s what we need in web3. 

Also, when we talk about reputation systems, it doesn’t just have to be proof of humanity. We can also see that AI can have a good reputation. I totally foresee a future where people will airdrop tokens to this AI because it might do stuff with it, maybe it invests or promotes it well. Their prior behavior informs of their reputation. So that’s what we’re trying to do with Mocaverse

Our +540 portfolio companies are all testing elements of their reputation that will then grow that network effect. This is how we onboard people into web3, with SK Telecom (in South Korea), we basically had millions of users onboard Mocaverse with a Moca ID. And they can basically start receiving some tokens, which is a way for them to get a taste of web3 and hopefully get deeper into this. 

Of course, South Korea is a key market for us, so we started launching with SK there first. Where we see a gap, we want to invest and support that. Similar to what we do with education, with OpenCampus and AI education, we try to solve things like student loans. If a student actually gets their loans through crypto and pays it back, guess what? That student is essentially crypto for life. Not only because it helps solve a great problem for him or her, but also because they learn about the nature of crypto. That’s how PayPal and Venmo onboarded their financial rails for students back in the day. I think we could do the same in web3. 

So these are gaps that we see. If someone else was doing it, then we’d just back them. But if we think nobody’s doing it, then we build it. 

That’s also the reason why we’ve done over 160 game investments, but the cadence of our game investments has decreased because so many good games are coming out, it’s much easier to back them and support them than actually building a new game from scratch, which is what we did in 2018 and 2019.

One final thing, we think NFTs are going to have a big comeback too. Web3 is a new wealth class, it’s not existing people who had money that got it, it’s a new wealth class. NFTs are representations of these social status goods in the same way that a Birkin handbag, or where you live, or the house you’re in is a distinction of that. But they’re not liquid in the same way. I see a lot of people make that same mistake, which is to say, it doesn’t trade as much as a memecoin, therefore it’s not as valuable. But that’s not really true because the representation is much more personal, which I believe is much more valuable to the human in the end. 

Basically, what’s the distinction between someone who has 5 million DOGE and 10 million DOGE? He has more money, but actually, he’s still a DOGE holder. I don’t care if you have 5 million more. But if I have a Golden Bored Ape or a Rolex, suddenly there’s a distinction. And that’s what people seek for from a status standpoint. It gives them more purpose and elevates their reputation.

I think this is where NFTs are going to have a massive comeback. 

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