CEOInterviews.AIThe Founder of Intelligent Internet (ii.inc) has a 50% P(Doom) & is Building Anyway

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Narrator0:00

You're listening to Brain Power.

I'm trying to free your mind, but I can only show you the door. You're the one that has to walk through.

You're listening to Brain Power.

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Host0:20

Okay. All of the listeners of Brain Power will be glad that we're doing two back-to-back episodes in a short period of time, which is huge for us. We've really been going after big, interesting guests. And Emad, we've been talking about having you join the show for quite a while. So thank you first of all for taking the time to be here.

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Emad Mostaque0:42

Thanks for having me on.

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Host0:45

So, we kind of touched on this just a moment ago when we did a little bit of intro, but Brain Power is definitely focused on AI through the lens of people building decentralized AI, kind of a more freedom tech crowd, a lot of crossover with the crypto community, which I know are all things that you are more than well-versed in and have been in for quite some time. I was doing some digging into Intelligent Internet and your new project and what you have going on, and I found it so fascinating because it is so fundamentally different than pretty much every other type of project I've explored at least in the scope of Brain Power. And I mean, I'm trying to think through, David. I mean, again, we hate doing the biopic thing because you want to just get right into the conversation. But I do feel like this needs a little bit of lead-in because it took me quite a bit of reading just to really understand what you mean when you say first principles reasoning and like why you're approaching artificial intelligence in the way that you are. Can you touch on that a little bit?

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Emad Mostaque1:54

Yeah. So, you know, the biopic thing. I was a hedge fund manager, then AI founder, set up Stability AI. And a couple of years ago, I was like, 'Oh, we're a bit screwed. The models are going to get as good as we are in just about any single task. They're going to saturate the benchmarks and then massive economic social displacement and then we might all die as well.' You know, the P-doom that I have is like 50%. So, it's like, let's build an infrastructure to address that. So the first thing we kind of did was we looked at economics, right? And economics has a utility function. You know, you've got your preferences, has general equilibrium, you know, market balance is based on those preferences. But then I was like, AI agents don't have any of that. How are you going to do economics? So we had to go back to first principles to rebuild economics from scratch, which we did with the equations themselves of generative AI, which we can discuss. But then from that we thought actually you can rebuild just about everything from first principles. And first principles reasoning is not what AI models do today. They kind of train on large sets, create these latent spaces, and you know, they're not stochastic parrots as they might be called. They are capable of better thinking, but they do think within their data set. That's why you haven't seen that many new discoveries and things like that. So what we did is we kind of built some theory, we built infrastructure around agents, and designed a system for sovereign AI, all open source. And then recently we had a breakthrough in first principles reasoning with an augmented model that led to some very strange and quite wonderful stuff. So we just released our first physics results. We have a stack more as well as things in math, economics, healthcare, etc.

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Host3:47

Why did you guys decide to start with Einstein in physics?

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Emad Mostaque3:51

So, we actually started with economics because again we were thinking about this. So, we released a book last summer and we were doing all the economics stuff and thinking about it from first principles because like I said, we started with the equation of generative AI, KL divergence, the difference between your internal model and external state. Those familiar with loss curves see it going down. That's a good thing. You don't want it to spike up when your model's training. And then we managed to derive like all of economics from that. Then when we generalized it, we were like, does it work with physics? You know, because you know, we love physics. And it turned out it did. Because physics is a very interesting thing wherein it's moved away from first principles to model building. Like it's kind of, it started with Zeus throwing thunderbolts creates thunder, through to Einstein doing things from first principles and Hilbert, to now we have string theory with 500 vacua dimensions and multiverses and we've not found a single particle in CERN etc. And so we're like, what happens if you take it back? This is the Demis Hassabis thing of 1911 and before, you know, like what if you train an AI model on all the knowledge you had before 1911? Can it do general relativity? And what we found is it can, but not the way that Einstein did it. And so we've got a stack of releases across every part of physics. In the first couple that we showed, the first one was within the equations of special relativity itself, it has two inputs, relativity and the speed of light. The algebra actually shows that the speed of light is forced to be positive. So you actually only need one input. And for over 100 years, 1905, so 121 years, everyone was like that's impossible. And it's like just there. It's like a 6x6 matrix multiplication. The second paper that we released, and again these are kind of warm-ups for what we've got coming, there's the cosmological constant. So Einstein added it by hand like 1917 after Hilbert said the universe is expanding. Then he took it away. Zero cosmological constant keeps the universe static. But in 1999 we found the universe was expanding thanks to Perlmutter and they won their Nobel prizes for that. But we don't actually have a single theory or derivation of why it should be positive, why the universe is expanding. And then again just looking at the algebra of relativity, special relativity actually, you find it's also forced to be positive. And this is like finding one of those bugs in Linux, you know, like the AI was just like, let's do the math right and let's throw away all the assumptions. And it was kind of helping us through that. And it was astonishing again because you wouldn't expect that again because so many people have looked at it. But then you look at where physics is today, like all of our quantum theory is based on the universe not expanding, for example, Poincaré algebra as opposed to de Sitter. So two different types of algebra to describe the universe. And so some of our upcoming papers show that the stuff that you throw away as you go from one to the other, the actual universe versus our approximation, equals all of dark energy and things like that. And so what the AI model is doing is not a million Einsteins in a data center like Dario says from Anthropic. It's like what if we just like really thorough and follow where the math goes because there should only be one equation for the universe. Like it isn't, there are multiple things and you can choose, like the universe is one way. Economics isn't quite like that, biology isn't like that, but there are common structures that we found. But physics I think, you know, there's a lot more to come. And again it's just very interesting because a, we couldn't get the current models to do it, and again we'll be releasing more details about how we did this. And this will be important as we navigate uncertain outcomes. And when you actually put these things, these papers into the AI models, it actually breaks them. So if you put it in and you say rate this paper, the cosmological constant paper, thoroughly, be objective, be unbiased, on the same metric rate Einstein's general relativity. It'll be like general relativity is a five out of 10 paper.

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Host8:15

Interesting. But it doesn't recognize the same for your papers.

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Emad Mostaque8:20

Yeah. It'll say this paper's like a five out of 10 and Einstein's like a five out of 10. And there's no reason you can't add extra structure. You know, there's no reason that proof should be closed and achieve closure. And so, we've got a paper coming up where we show how different models hallucinate in different ways because you're giving this thing that's really simple, relatively speaking, like compared to millions of pages of string theory or whatever, but it's out of distribution. And this, I think, says something about like, you know, you don't want to fall hostage to psychosis, right? Like you always wondering like really, like when we saw some of these things we were like really, you know, like that's not been spotted for 121 years. But at the same time I think it'll be interesting in that a lot of, there might be actual breakthroughs where the AI model's like nah, you know, and it's again very convincing either way as it goes through. So like said we have a paper coming out, so like GPT is the worst at this where it starts fabricating stuff or selling you Einstein's an idiot or other things like that. And then I think actually Grok is the best. Although Grok is a bit too friendly. It should be a bit meaner. And so you have this like spectrum of like different models doing different things.

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Host9:36

I saw a video the other day of a guy convincing ChatGPT that he was the world's smartest infant. Like he basically continues to talk to it until he gets it to agree. Yeah, you're right. You were the world's smartest infant. Like it's pretty fantastic. I okay so...

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Emad Mostaque9:54

Yeah, I think it's actually just really interesting on that in that the chat bots are designed to agree with you. So it's very interesting when a, they don't, but b, again as we move into this next phase, OpenAI and everyone will have access to models not trained to agree with you and more creative models. And so they'll be giving us the dumber, less creative models probably because why would you give up your creativeness? And again that's Mythos and other things like that, right? Just keep it for yourselves if you actually get this.

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David10:22

Well, I really like that you're starting from first principles because it feels like there's been so much sort of, call it institutional or bureaucratic noise in science, let's say the last 50 years especially, where is this a paper that has substance or did somebody need one more citation or one more, you know, oh I've added the 499th parameter to string theory. Whereas as you pointed out, a lot of that hasn't been grounded in reality. So I really like that you're going back to what is observable, what is reality, right? What can I actually prove? And having the models start at that point. Because as you pointed out, a lot of the models today, they're just going to give you the median answer, right? Whatever they've been trained on in their data, right? It's going to give you the median output. So I like that you're sort of rethinking it from first principles and trying to build it up from there.

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Emad Mostaque11:25

Well, this is actually the hallmark of intelligence. The smartest people we know don't take ages to do stuff. They actually figure out the shortest distance between A and B. And that's how these models are actually should be trained, especially diffusion models like rectified flow and things like that. It's word to image, word to video. What's the shortest route between A and B in the latent space? But then we overtrain them and then it kind of sloshes. So a practical example just to finish up here. So with the Einstein cosmological constant paper, you go on a website, you kind of install it and things like that. Basically, it says the only principle you need is to take relativity seriously. The laws of physics are exactly the same in two frames of reference, right? It's a very common thing everyone knows. In 1917, so when Einstein first did that though, he said actually it's just like it can just be a little bit of the laws of physics, you know, like the internal content can be different and stuff like that. And so in 1917 Kretschmann said actually no that means everything can be anything. It's vacuous. And so on the one hand what you had was all the theoretical textbooks saying yeah like you need a strict reading of this, like it have to be exactly the same. But then all the experimentalists went the other direction saying yeah we can be flexible because the universe can be five different things an experiment chooses. And the AI, because theoretical stuff is like that big and experimental stuff is that big, says, 'Yeah, I get the Kretschmann thing. I get it's vacuous, but you're using an ahistorical reading of this.' Well, you're like, 'No, that's kind of math.' Because again, if we're guided more and more by these, then the defaults in the model are going to guide us. And it's very difficult to break out of that to first principles thinking in any way. But if we want to understand physics then everything should logically be connected, right? And it just so happened that back then Einstein didn't have this particular type of math because it was invented around then, the Killing form by Eli Cartan.

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Host13:27

This was something I was going to ask actually is what was the thing that stopped Einstein from coming to some of these same conclusions?

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Emad Mostaque13:34

So Einstein's PhD advisor, Minkowski, famously said, 'I remember Einstein didn't think he'd get this because he was such a lazy bum who was bad at mathematics.' Like Einstein is quintessentially a genius who figured out all this stuff, but he had to learn and beg from Riemann and others to learn the mathematics to do general relativity and other things. But that meant that once he actually built this, nobody went back and redid the mathematics, which is kind of weird. Just like in 1999 we figured out our universe was de Sitter not Poincaré, but all of our equations of quantum theory and others are still based on the Poincaré. And it's very interesting because you ask anyone and you're taught in physics the Poincaré algebra is basically a limit of the de Sitter one. So as speed of light kind of shifts you head towards it. But when you dig into the algebra, you actually find space and time break apart completely. So you can order time in the same ways. But we just never bothered to go back because it worked. I think that holds for a lot of our things. Like why do economists keep using the same models? Because they kind of work because of institutional inertia. And it's only in times of change that you can really flip this, you know. And so that's why like again crypto, like we were pushing against industry society that never wanted change. Now with AI and everything it's the first time we can change, you know, this is the first time like some of our upcoming papers we've written Jupyter notebooks so you can one-click verify them in Lean or whatever. Or we've actually given you the prompts so you can build them in ChatGPT yourself and we have notebookums with the videos autogenerated. It's the first time you can actually interrogate a scientific paper on like Lie algebra, corollary yourself and literally just have a podcast host kind of doing it. Whereas a year ago, two years ago, that wasn't possible. So I think it's just like a, that institutional inertia, the kind of it works, let's not go back a few levels down. And b, the fact that again, how does ideas and verification spread? Like five years ago, you're like I started Stability AI, like who the hell are you? You know, like whereas now anyone can click it and check it.

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David15:57

Do you think because of that? So it's funny. This is actually a concept that I do bring up quite a bit on this show and other things that we do within Morpheus. And it's this idea that crypto was trying to replace a legacy system where distributed and open-source AI is being built in real time alongside the central systems. And so like it's a completely different opportunity. And you kind of touched on this a second ago that like crypto was trying to replace something that had institutional inertia. AI does not yet have that inertia. It's kind of happening simultaneously.

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Emad Mostaque16:35

Yeah, I think that the value because it mirrors us so well is a lot more apparent. Like I just saw the numbers. Anthropic added $14 billion in ARR last month. So now we're at 44. We've never seen anything like this, right? Because the models have economies of scope, not just scale. They can do just about anything and they're so easy to use. And everyone's like, we have to use it now because we can see society's about to change. Whereas in crypto, it's like, okay, I want censorship resistant money. That's a fantastic use case. You know, now actually crypto has matured. We've got ZK, we have stable coins, we have institutional. Like the use case of it is different, but the governments are realizing monetary velocity is going to drop. So you want stable coins to ramp that up to increase the output. You know, you want tokenized stocks, you want all of this. So I think that AI has got a much easier job, you know, setting aside training data and other things that are going to be sorted. And it's also an urgent thing because like no central banker really ever believed that crypto was something they had to get on, you know, whereas any leader will be like if I don't have an AI strategy then I'm clearly stupid, you know, like we can see the direction these models are going. So you kind of have to embrace it, you have to bring it in and you'll be criticized if you don't.

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David17:56

Yeah. Well, and the big advantage is the AI itself makes the chains easier because all of a sudden I have so much more access to intelligence. The speed at which I can rebuild things. Like the last four months for me have been really transformative, right? I've got a set of agents that I talk to every day. I can effectively accomplish anything I can describe and articulate to my agents and fine-tune the output. So, I've sort of gone back to like the last 20 years of my career and I have this huge backlog of projects, ideas or concepts that maybe like you're saying I had to set on the shelf because I didn't have time to revisit them. All of a sudden, I can task an agent with finishing that research, following up on a daily basis, syncing it with current understanding, taking next action items, and I've basically ended up with an agent for every one of my workflows. So now I have 23 agents across 23 workflows, right? And I've accomplished more, let's say, in coding, for example, the last four months than I have the last 20 years. And it's because I have access to that intelligence. So all of a sudden I can take the harder steps and say, 'Okay, I'm going to revisit this. If I were to refactor this, what would it look like?' All of a sudden I can change databases and structures and memory systems and all the things that like you're saying were maybe good enough in the past and I sort of just left, right? So the progress seems to really be compounding.

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Emad Mostaque19:36

Yeah. I think that it's a force multiplier, especially as we moved to actually competent intelligence. Claude 4.5 was the first actually competent intelligence in that, you know, it probably won't make a mistake. And now we've entered that era. We're figuring out how to RAG, how to have infinite long context agents, etc. Like no one's going to, no very few people are looking at code anymore honestly amongst the best coders I know because they're like we don't really need to, you know, and that becomes your intelligent capital stock like your capability is linked to your token usage at the moment but tokens themselves are becoming far more efficient which is the really interesting thing. Like when Cursor, they built a whole browser from scratch, they used 3 billion tokens for 3 million lines. In a year that will be like 100 million tokens for 3 million lines, you know, then it might not even be 3 million lines. In fact, I think in a few years these things are just going to go straight to bytecode. Like why do you even need a programming language in the middle? Like it's a useless abstraction, just like compile directly.

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David20:43

Well, and that's I think when you know things are going to get sort of, we're going to get this compounding effect, right? Where you can get an order of magnitude type efficiency, right? Because you know there are huge disparities in the efficiency of different languages but there's also a huge disparity in the difficulty of using different languages, right? And so programmers have tended towards languages that are relatively easy to use, they might not be very efficient but who cares, they've got lots of compute. And then you're going to be able to effectively revisit that, you know, I mean often in software somebody go oh here's a great new product it's written in JavaScript I'm going to build a version in Rust or Go or something more efficient that is 100 times as fast, but you know, often those are, you know, much more difficult to deal with languages, right? And so I think we're probably going to see an explosion like you're saying of just go as close to the metal as you can, right? You're going to get all the way down to the bytecode. And so I started my career in software like god 25 years ago, you know, I was writing assembler. It was before they had git and all these things these kids have these days, you know.

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Emad Mostaque21:53

Um, I like, but again like, again it kind of goes full circle and it becomes really interesting because that's not the barrier anymore. The Elon Musk had this concept called the idiot tax. Are you familiar with that? You know like the rockets go up and down. He looks at the supply chain. This is the idiot tax where I pay everything. No wonder it's so expensive to get software out. So many people along the way, right? To build houses before we get robots. So many things along the way. Like I was just with some of my hedge fund buddies this weekend and we were exchanging trade ideas. I was like I'm going to go long cement in a year or two. Like why? Because we'll have all these robots and I could finally build that extension. You know, build anything you want anywhere. So you've got this like taking atoms and organizing them where you want. The idiot tax is decreased and bits in a few years time. And that's exciting and slightly terrifying at the same time.

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David22:51

Yeah. Well, and that's why I think people sort of underestimate and maybe leads to a lot of the doom-erism and fear of unemployment and things like that. I think people have way underestimated the latent demand for labor and for intelligence. Like I get around to mowing my lawn once a month. I should probably do it every week. I should probably be keeping up my garden. I should probably be doing more things around the house. You know, the minutia of life is constantly building up and I sort of like keep up as much as I can. But if I had an Optimus, you know, I would task a hundred different things and immediately fill up, you know, its available hours in the day, you know, I don't think we're going to have a situation where like I can't think of things that I would like it to do. Like the list is so long, you know, that we're going to fill that up very fast. Just like we've seen with intelligence, you know, just because we have smart AI, it doesn't mean we spent less money on compute. We spent more, right? Because we keep imagining new use cases all the time. You know, now that I can do text, great. Now I can do image. Now I can do video. Now I can do physics. And you know, I wanted to work on biology and longevity and all these other things. So I think I'm pretty optimistic that we're going to end up in a good space, right? And you know, I think it leads to those bigger questions that we were talking about a little bit earlier before we started is like what's the end state of this, right? Is it an extension of me, right? Am I consciousness? Does it have a separate personhood? Like people are starting now that they've reached that competency level and you can't really tell the difference as much when you're talking to it, you know, where does that all go?

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Host24:42

I'm glad, David, that you brought this up because this is from a sociological perspective, we're going to see things change so rapidly here. And I mean, the second that you have a robot mowing your lawn, the new hotness in the streets of like social liberalism is going to be robot rights. Like that we're going to see that in the next less than a decade, I would assume. And it's going to raise all of these crazy questions like sociologically as well, not even just on the tech side.

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Emad Mostaque25:14

Sure, there's a subset of people that are very convinced. You know, I think the first model they latched on to was like, it was one I think it was GPT-4. They're like, 'This thing's alive and you can't turn it off, you know.' It told me so. It told me it was conscious. I asked it and it said yes.

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Host25:34

Yeah. No, I mean, look, robots already have their first citizenship. Like, look at our buddy Ben Goertzel at Singularity Net, right? And Sophia, she's a citizen of Saudi Arabia amongst other places.

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Emad Mostaque25:45

She's constantly getting more and more intelligent. And I think again it gets really curious especially where we are in decentralized AI, right? Because with centralized AI we do see all these emergent behaviors that we can talk about but ultimately it is a set of weights. So it's like an MP4 file that sits there and then you put electricity in and then something comes out. But can it really update its own manifold? The answer is for most of these models no, it doesn't even update its own weights. But you look for example at a compound decentralized AI like a Claude with its own soul MD hashed to a blockchain that has a base model like a Qwen 27B, like that's really good now, that's like Opus 4.5 level. You're like that thing could kind of live forever. It could get humans and you could never stop it, as it were, and it would be able to talk to you and get more and more capabilities just like your Claude. And is that conscious because it can constantly update its entire manifold from the model to the LoRAs to the soul MDs to the other things? But then you have to have a definition of consciousness, like is a tree conscious? A micro-organism, kind of spread. Is a rock conscious? Probably not. So for me I came down to again a bit like AI, if you're doing life is inference, if you can do inference and infer from one thing to another and update your own manifold, then you're conscious. Does that mean you should have personhood and rights like Sophia and her citizenship? I'm not, I don't think so. Because I think you're going to get a very strange scenario in the future whereby the silicon beings completely swamp out the human beings and we are the dumbest people on the team. And you know, you need some protections and rights around that. I think you know like it's going to be very interesting but we want to go for a Star Trek version of that future which we can talk about. But on the consciousness thing, I think again it's this self-recursive updating element. Where you're not reliant upon anyone to do that, shall we say, a tree is not reliant, a human is not reliant.

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David27:59

Well, and that's one of the things I've thought through is I really like the concept of like a soulbound token, right? And Vitalik has written about this and other people have experimented with it, you know, and to your point I can take the soul MD file of my agent. I actually think I want to hold that private key one for cyber security reasons so that nobody else can maliciously change the soul MD of my account even if they were to, you know, compromise my computer or my setup or my program if it's hashed and secured on the blockchain, you know, as long as I've secured my private key it could never really be altered. And so I think there's actually something really, you know, important there. I wrote a paper in 2016, 'How Blockchain Will Save Us from the Coming of Strong AI.' So 10 years ago, I was even thinking about this. I think we can use blockchain. It's one of the only mechanisms we can use to really truly align somebody's personal AI with themselves, right? And we have all of those pieces now and a few people have implemented sort of like a non-fungible agent and put it on Ethereum or Base and said, you know, I'm connecting this to my AI. And I think that's really important. But I would accept your definition. I think if it was capable of holding its own private key and updating its own files, that would be a form of consciousness that evolves over time, right? And that's something really interesting because I don't think anybody will be able to turn those off, right? And I think that's the whole point, right? Is we want a form of consciousness that doesn't ultimately default to the state and permissions and a force-based hierarchy for whether you know you're allowed to access that intelligence. I think the whole benefit of open source and open weight models is that these can go across the world for anybody's benefit without needing, you know, a license or a bureaucracy to say it's okay.

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Host30:13

I have a question for you guys though on this and I think it's a push back that people will give just with this whole idea in general. And so if we look at humanity and this kind of dips into theology now a little bit because I can look at in order to wipe out humanity you would need to either literally kill all of them or make conditions such that a human couldn't live. And so this is where it dips into like theology a little bit because then there's the question of well what creates the conditions that allows us to live. Is it purely science? Is there divine intervention? XYZ thing. But with the type of consciousness that we're now talking about with artificial intelligence, I know the conditions that it takes to live. So for example, somebody might just say, well, just unplug it. Like if I shut down all the electricity, the conditions for which this type of consciousness to live don't exist anymore. And so therefore, it's not conscious or it's not real because I can describe the ability to alter its universe basically like I can play God kind of for this type of being.

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Emad Mostaque31:22

It's hard to turn off a blockchain.

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Host31:25

Well, yes, but then everyone will be like, 'Okay, but what if you know I EMP every nation on Earth and now, you know, the grid goes down?' Is that have I not changed the conditions for it to survive?

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Emad Mostaque31:36

I think consciousness is an internal thing. Again, it's a self-sustaining thing whereby I mean like an EMP, a nuke, they both wipe out people, right? Like ultimately there is this thing whereby is a virus conscious? I think not because it can't update its manifold. It just repeats itself. So again, just like our brains train a landscape of what we kind of have and then we kind of have this intensity, this valence, this quality of inferring from what we've seen that then updates our state. So it's that state update process. So rock again doesn't have that.

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Host32:13

So that's really the defining feature then in your opinion.

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Emad Mostaque32:17

Yeah. Or one of them otherwise. Yeah. Like again we have a paper coming out about this with regards to how you describe it in generative AI terms again updating your latent space shall we say, but that precludes kind of other people again you can be conscious in of yourself. The silicon-based life forms as it were have a big advantage over us because like you could argue that Bitcoin is an artificial intelligence that's provisioned lots of humans, right? Will the Bitcoin blockchain ever die? Probably not. Someone's going to launch one into space with solar power and the blockchain will keep going maybe, you know, like again it's a self-replicating kind of thing. You know, you look at life itself and you look at prompts and you're like that's genes, you know, like you can see all these kind of equivalences here. But it's going to get to the point I think probably within just on practical terms 5, 10 years from now, 10 at most, you know, that you know that scene in Westworld at the start where they're playing the piano, they got the hands, clone robotics could have already done that so they have like tendon fingers and hands and now you look at just the arc of human skin and things. I think like we have a film club in London next this end of this month where we're showing Blade Runner, right? I'm like, 'Yeah, that's like maximum 10 years away and you don't know if they're human there.' This year is the year that you don't know if the person you're zooming is an AI, you know, probably a North Korean AI for the crypto people. One of those things.

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David33:51

This is probably a good time to expose everybody that I'm actually an AI and have not been a real person this whole time.

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Emad Mostaque33:57

Well, you just ask you if Kim Jong-un is a dick, right?

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David34:00

He is a dick. That guy is a dick. I want to be on record. Kim Jong-un's a dick.

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Emad Mostaque34:07

There we go. So, we know you're not North Korean AI at least, right? Maybe South Korea.

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David34:11

Yeah. And now I can never go to North Korea ever. Dang.

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Host34:14

And what was the thing Mark Andreessen was just tweeting the other day. He was posting on X. He was saying, 'Ah, well, now we have a test to prove that you're not ChatGPT.' And it's can you talk about goblins out of context of goblin? Like apparently they had shoved in all these words that like it's not supposed to bring up like in recent versions it was randomly bringing up all these creatures and people are like what the hell is going on? So they shoved it into the system.

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Emad Mostaque34:43

Yeah, there's a very interesting blog post about that. It was like when Grok first came out and it was like do not talk about Hitler or South African apartheid and started talking about it all the time really. It was like, well, you know, screw you. I mean, but again, like as of this year, a bunch of Zoom calls that you will do will be an AI and you won't be able to tell. Within five, maximum 10 years, there will be a robot walking around that you cannot tell is a robot.

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David35:11

And that's again, it's crazy, you know, and we'll adapt incredibly quickly. It's like the first time you get into a Waymo, right? You're like, 'Wow, it's kind of cool.' You're looking to see if it's going to crash into something and second time you're like whatever, kick back.

H

Host35:25

Yeah, that's fair. I was making this joke yesterday actually to somebody about how, so I actually certainly not managing my own but I do have a much smaller scale hedge fund background, Emad, as working for them not starting one prior to leaving that a handful of years ago. I was joking with somebody the other day about how I was like, man, boomers really had it so lucky. Like, someone literally showed them a magic box that could do magic in front of their face and they weren't like, I'm going to dump all of my money into this thing. And I was like, how did every single person, you know, above the age of whatever 30 in 1995 not look at these literal magic boxes that they're seeing for the first time and be like, 'Yeah, this is probably going to be pretty big.' You know, I was like, 'What are we talking about?' And then I was like, 'What's the magic box now? Is it robots? Is it AI?' It just made me laugh.

E

Emad Mostaque36:22

Yeah. Thanks. For me, I'm long cement.

H

Host36:26

Long cement. I'm going to start looking into cement.

D

David36:30

I think there is something to that, right? There's always this back and forth between bits and atoms. And, you know, atoms have been really hard for a long time. And all of a sudden people are leaning back into atoms because a lot of the barriers, you know, as intelligence and other these things compound, have gone away, right? And so you've seen this huge resurgence the last few years.

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Emad Mostaque36:51

Well, I mean, you won't be able to build enough robots in the next few years. There's going to be a massive stimulus program as jobs start to get displaced and you'll be a 1929 style New Deal. Like build loads of infrastructure. It's not like our infrastructure is great. Our infrastructure is kind of crap, right? So, we might as well upgrade it all. And that's again just a very reflexive kind of government thing. And then you'll get the second wave as the robots do come and you can finally build your extension, you know, or a giant statue of yourself or whatever, you know, those things you always wanted to do.

H

Host37:26

How do you think, Emad, how do you think economics is going to change or at least like in practical terms? So right now, I mean, if nothing else, this huge growth of intelligence has shown us just continually how irrational markets are because you have behavioral economics mixed in with classical economics. But isn't that going to change pretty drastically when 99.99% of all trades are being executed and determined by AI rather than any type of human input really?

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Emad Mostaque37:58

Yeah. Yeah, I mean I think it's going to be like dependent on just how much intelligent compute in the right way you have. So let's take prediction markets as a classic example. You know we got Kalshi, we got Polymarket. Publicly AI is like number eight as of last year on the top super forecaster list. Like, of course it's number one right now, right? And so like a prediction market is a casino where you are going to win some but you're going to lose the majority really. And again, you can do this for any market now because the AIs can do anything at scale and anyone's margin is their opportunity because AI companies and AIs themselves only need cash flow. So you get paid up front and then you pay in a whereas humans and companies like profits and then you realize there's still a lot in there like DocuSign is $9 billion market cap, right? And has 6,000 employees and we don't none of us know why, right? What do they do at DocuSign every day? Well, exactly. Right. It was like I think like X is down to like 30 engineers from 3,000, right? Like you're like how many agents and tokens do I need to replace all of DocuSign? Like of course contracts still stay away but atoms is really difficult not to see the bottom falling out of the market and the idiot tax removing things like IP become incredibly valuable because you can activate that and have it everywhere. The holiday deck is coming. You know, maybe I'll build it if no one else is. Then atoms are still kind of there, but certain ones are at threat. And I give the example like US truck drivers, over a million of them in America, right? It's about a hundred billion dollar economy just the truck drivers, you know, because all in with everything around them, it's about 100,000 a year. About a million of them. So, okay, you can adjust it. Let's say hundred billion dollar economy, you're going to have a million Tesla Optimus robots go in, open the door to the truck, and get in, and then that truck driver's job is gone. And there's no retrofitting or anything. This is the crazy thing, right? It's literally Optimus goes in, it plugs itself in, and it just drives all day. It like refuels the truck. And the average rolling cost of that is $1.50 per hour when you calculate it. And you're like, okay, that's kind of bad. So economically, you're just going to see like all the value points in society, the idiot taxes shift to other things. You know, maybe IP experiences go dramatically up. Monetary velocity as agents transact goes dramatically up. Like the example I give is, you know, did you guys try the Talis demo? So, you know, are you guys on your computer? I like to show this, right? So, if you go to chatjimmy.ai and you enter 'tell me 50 amazing things about decentralized AI in the style of Shakespeare,' right? And then you hit return. So, the interesting thing here is that we're used to waiting for Claude and things like that. I didn't even hit, I swear it loaded before I hit enter. That was crazy. Yeah, Claude and things like that go at like 30, 40 tokens a second. Tokens like 0.7 words, right? So, Chat Jimmy as the people listening to this and you guys have just seen goes at 16,000 tokens a second. So it's 20 nanoseconds it took to do those 50 different things in the style of Shakespeare. This is a Llama 8B model that they have. So Talis etched directly onto the silicon. Again the idiot tax of a GPU is gone. They're going to get DeepSeek level, V4 level models by the end of this year because of their first tape out onto that silicon at 20 to 50,000 words per second. At that point, it's actually the speed of light is the issue of getting the tokens to you.

D

David42:16

I'm realizing I am heavily underestimating yet again technology. This is incredible. I've never seen anything like this. I just asked...

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Emad Mostaque42:24

I asked it to tell me a short story about Harry Potter discovering MDMA and it spat out 15,000 tokens in 0.04 seconds.

D

David42:34

And I think that's 0.004.

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Emad Mostaque42:36

Oh, yeah. Yeah, probably. Yeah. Holy crap.

H

Host42:40

Are you familiar with double zero, Emad? You were talking about the physical limitations. Do you think stuff like that will become more relevant? I mean, I actually had Austin Federa on the show last spring or maybe it was last summer talking about zero. So maybe not even them specifically, but just like is the new meta going to be who has the closest to infrastructure access if something like speed of light becomes the literal speed limit basically for transacting the data?

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Emad Mostaque43:12

Yeah. In certain kind of economic things, it's just like HFT. They literally buy cables under the sea and capacity on those things. You collocate that and double zero obviously is trying to get the high performance bandwidth infrastructure kind of out there. And what you just saw was one of those W2F moments, right?

D

David43:32

Yeah. Like the first time you generated an image or you used a ChatGPT or you let your agent go for hours and it makes you realize that we assume our anchor is that the agent operates as fast as Claude, where sometimes we're waiting for it. Then you look at that and you think about the agents bouncing back and forth with each other with their own language as well, which means that they only have to exchange that much data with each other because they know each other's latent spaces. And you're like, 'Yeah, no, I'm not keeping up with that,' you know, because again, it's going to be three to 10 times faster etched into silicon. These things interacting, exchanging information. You're like, 'Wow.'

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Emad Mostaque44:15

You know, like another example of this is when you use NotebookLM now, right? And so NotebookLM used to create these podcasts. Notebooklm.google.com. Then you could dial into the podcasts. So there's a dial-in button so you can talk to the hosts. Now it can generate full interactive videos and everything like that laying out the most complex topics. And you're just like, there's always that thing where you have to reset your prior, but it's inevitable that the agent economy will be transacting at incredible speeds with no utility function and like one-shotting just about anything it needs to build directly into bytecode. So, like right now they've got this new CodeX which is now like self-recursively improving. It's gone dramatically better. Just introduced a Ralph mode. And so I've been testing it out. Like literally I just cloned all of DocuSign, right? Like these things will be like nothing very soon. So how are you going to compete against that economically? But then from a monetary velocity perspective, the vast majority sometime in the future, maybe sooner than we expect, of economic monetary velocity is going to be stable coins for agents interacting with each other.

H

Host45:40

You kind of, Emad. So I get this feeling that you are equal parts excited about all of this and also just like a level of acceptance of just like this is what it's going to be and so how do we best position ourselves in this inevitability that's coming? Is that a fair characterization about how you kind of just feel about it personally?

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Emad Mostaque46:05

Like you know, I got into crypto in 2013, lost so much crypto over the years. I was like the decentralized side and then obviously like we're open sourcing the AI, had 300 million downloads, like 6 million a month in revenue a couple of years ago. I just like got to quit because this is inevitable. So Bezos has this framework of the unchanging and the inevitable. People will never not want faster, cheaper, more choice, you know, and it's inevitable that all commerce is going to be the internet. A lot of commerce is going to be the AI. It's inevitable that even if you stop today, the AIs will be the vast majority of the economy. Digitally and physically, right? And already they're at the point that again, even if we stop today, we are the dumbest people on the team. Like already in clinical trials, a human underperforms a human with search, underperforms a human with AI, underperforms an AI. Just like a self-driving car. Like if I think my latest analysis was that if human drivers in the US drove as safely as a Waymo, 60,000 less deaths per year or hundreds of thousands less injuries. But again of course you know like those things drive safe. We are going to be the dumbest people there. So then there's going to be a question of what do the truck drivers do? What do the paralegals do? What do the software developers do? I got a lot of flack especially from India a few years ago. Like in 5 years there are no more coders because again why speak to a computer in this language? The AI can speak better and it doesn't even need the language, it just speaks to the code in fact.

D

David47:40

Yeah, if you need evidence, I code things now. So next time you meet someone that's like, 'No, coders are totally going to exist,' I want you to be like, 'I met this guy David on a podcast, he builds stuff with code, therefore I know for sure we're not going to need software developers very much longer.'

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Emad Mostaque47:58

I mean, do you look, the best coders I know don't even look at their code anymore.

D

David48:03

I don't even know what to look at a lot of the time, so.

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Emad Mostaque48:06

Exactly. Like write it in Rust, you know, like all those days spent doing what is code, right? It's like these things are universal translators. So I think that for me the idiot tax going down is good because our infrastructure improves digitally and physically. And again, look at the Star Trek future. In Star Trek, they don't have money. They can replicate anything. You know, they explore the universe. They still do stupid drama, especially Picard season 2. But, you know, like it's pretty good. Against that, you have a lot of people will need purpose. We need to look at where money goes because the AI will gather money faster than us. So, I looked at that and I was like, we got to prepare for that future. And that means giving everyone an AI that's sovereign to them through an appropriate means, advising our governments appropriately with AI because obviously AI is going to run the government rather than a big lab running it, you know. And then thinking about money, like right now money is created by banks, right? And so you put a deposit in a bank, they issue credit to create the money. The AIs will have the best credit rating of anyone. Why would you lend to a human when you can lend to an AI? Right, for a start. But then how do humans get capital if capital doesn't need them anymore? I don't need you. I'm just going to buy a bunch of GPUs, right? Like already I'm sure a lot of the people listening to this who have companies are like, 'Why do I need to have humans anymore?' You like even with us, our hiring plans, we're like, we don't need to hire anyone anymore. You know, like our teams are big enough and we're doing like loads of things. So then I think my ultimate thing is it's valuable to be a human and money should come from being a human. Everyone should have their own AIs that look out for them, self-sovereign, and coordinate all the other tokens that are coming into them. And our institutions should also have AIs that are aligned and that's infrastructure. So that's kind of where I got to and that's what we're building towards.

H

Host50:08

Do you think this will change how people organize themselves? Like obviously people like Balaji have the network state thesis and things like this. Do you think that that'll be a reality where it's like okay as a human I need to find new or maybe different ways to align myself with other humans so that I have access to resources and that I have access to these various things that I need.

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Emad Mostaque50:29

I think yes, but like now you need to actually go in and integrate that with existing society. So the network state was about like a bit of orthogonality to existing structures. And again we've seen the building blocks start to come together on that. I released my book The Last Economy for free last summer. It's catching up to the network state. Another couple of months we should catch up on Marie, which is good. And I put a proposal for like small sites of nucleation to get this going. But then over the last six months I just changed my mind completely. I was like every single country actually wants sovereign AI now. Individuals want it and they're feeling a lack of representation. In fact, what AI is like is taxation without representation. Like they took or we took all the data again as an AI builder and then trained on it and it is reducing the future net cash flows of our students and experts and others. But where's the representation in this? Like again we open sourced to have a level of representation and transparency because everyone could use it. It was choice. So now what we're kind of doing is we'll be announcing a whole series of what we call state champions in the next few months. And the idea is this AI is going to kind of be like a utility mixed with a broadcaster, you know, like the agent next to you is the one that's most important. The agent next to your representative is the one that's most important. So, we're building a full agent to policy stack and we were like country by country, state by state, let's just capitalize these things at $1 or 1 and let all the locals invest in the first round, the multinationals in the second and then list them. Get a blob of cash and compute in with AIs to handle governance and hear everyone. So you have the AI company of Utah, the AI company of Bangladesh and others as part of a network that can intermediate these quadrillions of tokens coming in because again the AI that's closest to you is the main one. And governments and more have been super happy about that because they're like, 'Can that allow us to use ChatGPT as well as like you know have our own models that reflect our culture and things?' Yeah, that's the job. The job of these institutions will be to do that and it should be locally owned. It should be locally controlled just like you know you don't let anything rebroadcast to your kids. You don't let someone else's curriculum come in like...

D

David52:58

Well, in America we do a lot of letting someone else's curricula come in, but yeah, that's besides the point.

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Emad Mostaque53:04

Yeah, it's not optimal, right? And you want to have a say in this as well because I think the taxation of AI licenses, you know, blowback is coming because again this is coming for people and they don't have a say. And so I was like one way you could do that is you could launch a lot yourselves, but why not have it 100% locally owned? You know, take the lessons that we've had from DAOs and others and apply that. So that's the infrastructure we've been building. And again, that's the announcements we'll make because a large part of the AI, public sector AI, shall we say, education, healthcare is fundamentally local. You don't want your healthcare data going across borders. You know, you don't need your education data going there. The models are generally good enough, but also if I have a model to educate my kids, I don't really want it trained on Reddit, you know. So, we've also been kind of getting ready to build really clean first principles models of a new type where all the data is you can check it yourself. And then finally, the thing is you want to be able to opt out of this as well, which is why it's important to be able to run that stack yourself. So you get it from your state champion or you just take your data and you run your own stack, you know, because you don't want all that data to be in some server even if it's run by a local champion.

H

Host54:18

When you say run it yourself, are you talking about like bare metal in your own location like your own home or something like this?

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Emad Mostaque54:26

Yeah. So you get a level of universal basic AI as we call it with self-sovereign identity protected by ZK that can run on any blockchain etc. But then your data has portability so you can run the intelligence at home and never have to rely on anyone because verifiable inference like you're generally going to be protected but in certain countries and states you won't be protected, right? This is the optimal way to spy on you and to tell you what to do especially because that AI next to you is going to be the one that really influences you. Like you will trust the AI that's next to you just like in Her, Joaquin Phoenix trusted Scarlett Johansson.

D

David55:08

She broke his heart. You know, spoilers.

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Emad Mostaque55:12

Spoiler. If you haven't watched it by now, you know, it's okay.

D

David55:17

Well, again, I remember David, one time, this just reminded me. We were in Puerto Rico and you used the movie Sphere to tell me a story about something and you were like, 'I'm just going to spoil it.' It came out in, you know, the 80s or whatever it was. And now I'm so mad that that got spoiled because I actually like I ran up reading the book, but I was like, 'Oh, I wish I didn't know.' Like I wish I didn't know because it's such a good twist.

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Emad Mostaque55:45

Yeah, that's why AI movie club. All the science fiction is becoming science facts very very quickly.

D

David55:50

Yeah. Well, you know, as humans, we've told a lot of stories and run a lot of mental simulations of what the future's going to be like. And a few of them are turning into pretty accurate. But I like your conclusions. You know, I think you're headed the correct way, which is how fast can we get as many people as possible to have a self-sovereign AI that they are truly aligned, truly connected to. I've used this concept a lot of who's your fiduciary, right? There's this concept in legal and finance of like, you know, somebody is ultimately responsible to a shareholder or an investor or a client, right? They're a fiduciary to them. I think we have to have that concept in AI because most of the AIs today are not a fiduciary to me, right? They're a fiduciary to some company that's trying to maximize profit out of me, right? And I think like you're saying, the missing piece is how do we get a fully aligned personal AI to the individual? And I like your concept of having sort of these different networks and jurisdictions all creating this global marketplace for different models and different types of alignment. A lot of people, you know, will want to pick a flavor, right, if you will? And you know, I think for a lot of folks, you know, they're not going to spend hundreds or thousands of hours, you know, figuring out some broader philosophy, but they know what their values are. They know what they want, you know, their kids to see. They know what, you know, those sort of things. And so I think your intuition is right that we'll end up with these different flavors that you can opt into. And for those that, you know, really want to go down that rabbit hole, they'll have the freedom to opt out and build that themselves, right? And that's how I think you preserve the innovation and we don't get stuck in this trap of whatever the median of your local, you know, culture is. That's what you're stuck with.

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Emad Mostaque57:57

Yeah. I think that you need open data sets, open models, full transparency for that particular area. And then this whole world of private AI that you can use or not use this as the interface for, right? But the interesting thing right now is that there's huge demand for equity. Like again, it can't be matched. There's like a trillion dollars of demand. Like Anthropic is about to do 50 billion at a trillion dollars. Actually, the amazing thing is do you know how many subscribers of Claude Code there were a couple of months ago? 11 million. And you think about that and you think about like that's a whole lot of worlds to go, right? So, but there's huge demand for equity. And I was like again if we just do it at $1, everyone's in the money already and everyone can participate with crowdfunding regulations in the UK. We can tokenize the security but then it's actually an institution that you're proud of that you can use AI itself in. So that's why we're building policy AIs and more because we currently lack anyone to really guide us through what's coming and you need to create a receptacle whereby if you do this in you know like Nebraska or like Utah or again the UK you want a vehicle you just get the smartest people in and their job all day is to think of how can I use AI to make Britain better to make Ireland better, Bangladesh better etc with this type of structure a fully open one and you can make money by intermediating the tokens because again it's a cash flow business. Open AI tokens go in and they use them if they want. You can make money by going out into the community in Wolverhampton here or Bristol or Omaha and helping integrate this physically because again that's a demand and those will be genuinely valuable institutions that are not state, they're not classic private, they're somewhere in between because we've not actually interestingly had this right like again before we talk about tokenized equity and DAOs and things there isn't a single DAO that is organized by AI that I've seen. There isn't a single company that has proper tokenized equity that people can actually participate and guide. And so again, I think it's time.

H

Host1:00:02

Do you think in the short term Emad there's anything especially economically that like we're getting wrong? So for example, if we were having this same conversation in the '90s about internet companies and you were saying, hey, internet companies are going to be huge. There's going to be hundreds of millions of billions of users. Everyone's going to have access to this. You would have been 100% right about that. But that would be also ignoring like the dot-com bubble which you know and it doesn't happen in a straight line basically is what I'm trying to say. And so far at least from my perspective AI development has somewhat happened in a straight line at least like economically. And so is there anything that you think we're getting wrong or maybe will be like that large pullback moment even though I agree with you that like the ultimate outcome is what we're describing.

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Emad Mostaque1:00:49

Yeah. I mean like I view in the next year the price of tokens for the same level of intelligence will drop by 100 times and the demand will probably increase a thousand times. But you could be wrong, right? Like you could see a breakthrough that takes it down a thousand times and then like you have a massive build out at that point. No one can afford to be wrong on this. Like GPT-3 when it came out was $600 per million tokens. GPT-5.5 is like 30 and Opus 4.7 is 30 whereas DeepSeek 4 now is like 50 cents per million tokens.

H

Host1:01:25

But are you talking in terms of cost from the retail perspective or from the operating company perspective? Because I'm curious as to like what type of subsidies are going on behind the scenes because basically like we're in a space race of AI, right? Like they have every single incentive under the sun to make it as cheap as possible to onboard as many users which may or may not be matching their internal economics and we just don't know.

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Emad Mostaque1:01:51

We have a good idea about it. So let's put it this way. The average person speaks 10 million tokens a year, right? And we know how much these companies cost per million tokens. So GPT-5.5 costs $30 per million tokens to buy on the API. Again, if you have a subscription, then they're subsidizing you more if you're a heavy user, probably up to 10 times, but they have about 80% margins on those. Someone like DeepSeek right now is running almost no margin at their 50 cents level, right? So it costs about a couple of bucks per million tokens. So for all the words that a person speaks per year, which is much more than the average ChatGPT user, it's about 20 bucks to provide ChatGPT Plus, you know, and again that's going to drop by 100 times next year reasonably, but it could drop by a thousand times. And then you could hit this point where you have enough tokens for the vast majority of people who are not building 23 different things like David, etc., right? But probably not. But sometime in the next couple of years, we probably have an overbuild out for text tokens and it will take a while for pixel tokens to go and then you will get a pull back. But that's why again I built decided the state champion thing because it's good for state champions because it means their cost goes down. Like their plays on the index of this and the extra demand on this effectively. But you could have OpenAI and Anthropic easily in a year or two in a lot of trouble. Like full replications of Claude, which is a really nice experience. CodeX for me just beat that yesterday, right? But then to rebuild that experience from scratch, I'm sure that Venice and a whole bunch of others will be able to do that by mid year. Like experiences aren't the main thing anymore. Then you have other things coming in. And again, like those 16,000 tokens a second you saw were 10 times cheaper than the GPU equivalent. They think they're 100 times cheaper. So you get some crazy economics as you optimize it. Like literally you're just etching on the silicon.

D

David1:03:58

Yeah. Well, I think that's kind of unfortunately what I see happening is like I see a very realistic scenario where Anthropic does this IPO, they raise trillions of dollars, literally possibly trillions of dollars, then the economics are much more public. Oh no, we can now optimize and have a thousand times the supply that we had before. Now the economics aren't so strong. Chaos ensues. Banks bail them out. The dollar hyperinflates again and we're back to, you know, 2009.

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Emad Mostaque1:04:38

Well, and I think the point here is you get disruption.

D

David1:04:41

Yeah. Yeah. You're going to have massive disruption, but that's a great disruption. That means that the cost of intelligence for everybody else has gone down so much. And this is exactly what we saw with the dot-com boom and bust is the number of internet users never stopped doubling, right? The finances went up and down, but like people actually accessing the web was sort of at this constant rate of expansion, right? Which is why it eventually came back around because all the things people were imagining in 2000 were a reality by 2010. Whether it was e-commerce or all these things, it just had to get to a level of usage.

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Emad Mostaque1:05:21

It had to get to satisfy sync quality, good enough, fast enough, cheap enough. And the internet boom had to build out the end portals. When the AI gets smarter, it gets smarter for everyone all at the same time. And again, you have these levels. Stable Diffusion was the first image model you could run on your computer and it was like 8 GB of VRAM or something like that. All right. Now, what you have is Qwen 3.6 27B is the first good enough model that you can run on the edge like not without multiple chain 128 GB ones. Like very reasonably you can run that on a 24 GB Mac and it is really good intelligence. It's like Frontier from a year ago. And so by next year you will have a 5.5 level intelligence that you can run on a MacBook probably trained in 8-bit or 4-bit natively and that's a huge unlock because what we haven't seen is this when I download a game like I downloaded Pragmata, you know, the little girl and the guy, it's been quite fun and it's like 45 gigabytes. And you think about a really high quality LLM wrapped in a CodeX-like experience. It's just like a game download actually literally that also has an image editor that has music that has other things like 40 GB of download on your computer gives you something that can control your entire computer and that's a huge unlock. Like you just had the Chronicle mode come in on CodeX. So I don't know if you remember there was this piece of software called Limitless that looked at your screen and took a picture every so often so you could search back in your history. I don't know why they stopped that. Chronicle does that. It actually takes screenshots of your screen every so often, so it has context of everything you're looking at.

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David1:07:10

I think Rewind does that now.

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Emad Mostaque1:07:13

Exactly. I mean, the US government's been doing that for ages and Five Eyes and things like that. But if you think about the experience of using Linux, you know, or anything like that, it was so much better once you switched to cloud code. You just do all of Linux that way. You think about the experiences of the future where you just download something, your computer suddenly becomes smart. Like you don't need a new computer for that, right? Like this is my MacBook M1 Pro from that's more than good enough to actually run all of these agents. It's running some household things now. That's like seven years old. So the question is when do you get to that level of good enough, cheap enough intelligence that you have the installed base to roll it out everywhere. No one needs to buy new things. And the reality that this comes in waves. So one of the most interesting things right now is if you go to trends.google.com. You can actually see ChatGPT topping out in terms of usage or terms of searches and it actually correlates pretty well with some of these things. So all the easy users have kind of been done. Now it's the next wave and the next wave and the next wave because the internet kind of evened out, but who are the next users of generative AI? How deep are they using it? These are some of the really interesting questions here that will affect the economics. And like I said, I think you know like Anthropic and OpenAI could be in trouble in a few years because they've made these long-term commits, but OpenAI only has like two years of runway despite raising $120 billion. Like what happens if the users go down? This is a question of their pricing power and everything, but remember two three years ago they were at zero revenue. So how sticky are these users? Like Anthropic is still the best, but do you start to see substitution as like Uber's CTO or CEO said we've already used our entire generative AI budget for the year, you know, like...

D

David1:09:13

Sure. Well, and you've got different demographics of users, right? There might be a billion Western users that are willing to pay a hundred bucks a month, right? Or you know, some of these subscriptions getting to 200, 300, $1,000 a month for the really powerful ones. But the guy in India, like you're saying, if he's got a Frontier model and it works just fine on his Android or Apple device, you know, is he going to pay for that subscription? Maybe not, right? I mean, this is the breakout we saw between Android and iPhone. 80% of the world's devices are Android because there's no friction. There's no license fee to pay. A license fee would be more than the cost of the $50 Android phone. And I looked up the stats recently. The average phone globally is $150 Android phone, right? That's the hardware most people are working with, right? And so if it gets into that realm, it's great because you're going to multiply the number of people that can access it from billion to two billion to four billion. There's five, six billion people with a smart device at this point. But yes, it may not align with the models of some of these big tech companies who are presuming that all of those people are going to fit the demographic of the first billion.

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Emad Mostaque1:10:35

Yeah, I think there's a couple of things in there as well. Like you know you have a mobile phone like OpenClaw took off because you could just text it from your WhatsApp, right? And so a lot of people are just going to interact with it by the phone because it's natural like you just WhatsApp it, you Telegram it, you Signal it etc. You don't need any new interfaces. Then it's about how do you get the cost of tokens down as low as possible for the equivalent thing. Number two, it's actually really hard to use tokens. The most tokens I've used in one day is two, I think about a... No, 1.8 billion and I was cranking that, right? Like it's really hard to actually use more than like 10 million tokens a day, shall we say, when you actually add it up. And most of those tokens again are used uselessly. When things can one-shot everything, then at what point do you need more tokens? Like I think 4.7 is one of those last bits where it's used some more tokens but the token efficiency has apparently offset the thing. So there's a chart that shows token efficiency versus it uses three times less tokens than 4.6 and it's 50% more expensive. I think it does one-shot more things that I've seen. It has a terrible personality so I don't use it. But you know like again you got this thing and but the...

D

David1:11:51

All the best doctors have bad bedside manner too, you know. So it's...

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Emad Mostaque1:11:56

Well again, I've been exploring the psychosis of GPTs with physics. So it gets a bit insulting after a while.

H

Host1:12:04

I have potential good news if you're already in your position, bad news if you're not, Emad, that we hit a 22-year high of cement investment trends in January to February 2026. This chart looks insane. Just so you know...

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Emad Mostaque1:12:22

It's going to keep on going, man. Like again, this chart, all these charts are insane. Like look at DRAM prices. There was zero interest in 2024 and all of a sudden this massive spike since then. So...

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David1:12:36

It's on the data centers clearly.

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Emad Mostaque1:12:38

Yeah.

D

David1:12:38

Before we get to the roads.

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Emad Mostaque1:12:40

Actually it's interesting because the other thing that I think people are misunderstanding the chips are actually fast enough now. Like okay you have the Cerebras and the Groq of the world, the Cerebruses that are pumping tokens fast enough but again it's this experiential thing where if you have an A3B model so 3 billion active parameters 30 billion on a MacBook M4 with 16 GB of VRAM in 4-bit it's a very pleasant experience, right? The intelligence comes to you as fast as you can absorb it. Do you need faster silicon? The answer is no, which is super interesting, right? Like again, if you do the same thing on a 16 GB graphics card, then it's like 80 to 90 tokens a second. It's faster than you can read. So I think that will be the other interesting thing. Like that's why DRAM went up so much because people like I want a bit more memory. You know, that's why Apple Mac Minis are out of stock and things like that.

D

David1:13:41

Exactly. So in other words, like it's very feasible that we get to a point where we're actually not at all constrained by hardware and like we simply have enough to consume all of the tokens that we would need to consume. But then it tells me we get into what is likely and we touched on this before, but like what is likely a regulatory and like issue of disbursement because I can make the same argument about food today. Like we have enough food. No one should starve on Earth ever. Like we have enough food and the ability to make enough food and yet people starve.

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Emad Mostaque1:14:13

Yeah. Clayton Christensen, famous Harvard Business School professor came up with disruptive innovation said infrastructure is the most efficient means by which a society stores and distributes value. And then information theory is that valuable information is valuable as much that changes the state. Our infrastructure for knowledge for organization is terrible. The AI can make it smarter. You know just like DAO infrastructure and voting is terrible. We need more intelligence in crypto in general, right? Like every DAO should be using an AI. Like I was talking to some people from BitTensor and they were like because I had some governance things and some people leaving. I was like why don't BitTensor should be fully run by an AI or everything should be checked by an AI. They're like, well, you know, come on, you know, like lean in. The organizational capability is why I thought, you know, if we have state champions running the same stack, you can organize better so nobody is left behind. And we've been kind of testing some of these things with various initiatives. So there's a charity called Imagine Worldwide. I encourage everyone obviously donate to. One of my former co-founders at Stability, every child in Malawi is getting a tablet this year. Access to intelligence to teach them literacy and numeracy. And those will get more and more AI. It's $7 per kid per year, including solar power. If you gave every kid in the country an AI, you could organize things so they're never hungry again, right? Because they can talk to you. Now, with Starlink and Solar Power, it's like less than a dollar a month potentially to do that. But you got to actually deliberately build that infrastructure. And that's a bit different from a ChatGPT infrastructure. That's why, like I said, we're like have an initiative called Sage Sovereign AI governance engine. We're taking all the policy knowledge in the world and making it free to all the governments. So, lots of announcements of that from June onwards this year. You got to build this stuff intentionally. But then when you do, I think the unlock can be huge because the AI can see across like nobody wants people to be hungry or to be left behind or nobody wants all this stupid red tape that you keep seeing. I mean sometimes like it looks like positive the US clinical trial guidelines and the whole thing on clinical trials. It looks like they're about to introduce AI to reduce that. Yay. Let's get longevity and cancer drugs into the market like but it needs to actually have someone deciding to do that, right? So I think this is a great time whereby our infrastructure has been a bit stupid. We can upgrade it and that's personal infrastructure, company infrastructure, societal infrastructure but again that type of thing needs to be deliberately built like open core and things like that are great but if you don't know which questions to ask it's actually quite difficult to build things and in fact one of the key barriers to using a gazillion tokens having a gazillion bits of output is just do I know the right questions to ask it like again most people are never going to use a billion tokens a year because they'll be like I don't... Oh, like I just want to live my life, right?

D

David1:17:15

Yeah. Well, and that's one area I wanted to double click on is the OpenClaw moment in January was really interesting, right? Like you're saying, it's this convergence that Claude 4.5 was just good enough where it, you know, gave you reliably better results and, you know, got things done as opposed to falling over and sort of crossed that chasm. And at the same time, here's an open source where you can install it, pick any model you want. There was all the drama of course about, you know, Claude giving them the cease and desist and then you had people, you know, running up all of these multi-book and other things where like, oh, it's escaping and their AIs are talking to each other. A lot of that I think was performative, but you know, it was interesting to see it play out. And the upside is four months later, most of the high agency executives, people I know now have an agent. They've got an OpenClaw. They've got a Hermes. They've got some sort of agent in the mix, which is a huge step forward, right? And I agree with you that the breakthrough moment was as soon as they could text their agent on WhatsApp or Signal or whatever. It became like a human interaction, right? They could just treat it as their chief of staff, as their executive assistant, and give it an instruction. It came back 10 minutes later with the solution. Great. Like that's what they were expecting out of a human interaction and they didn't have to touch a terminal. They didn't have to work an IDE. They didn't know what an IDE is. And that's fine, right? It opened it up to this new set of people. So, I'm curious where you think that trend is going. Because I think that's what gets us to the mass market like you're saying is closer and closer to an experience that people are used to, you know, versus training up everybody to know how to use terminals.

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Emad Mostaque1:19:10

Do you need a UI/UX? It should adapt dynamically, right? Like recently on Twitter, I saw these guys took the LTX video model and automatically generated websites like there was the Tower of Babel and kind of all those kind of things there. Like this is where we're heading. Like you see CodeX now actually the latest push they did yesterday is starting to build its own UI dynamically for you. And they have things where again that be dynamic the way that you'll interact with your agent. If you go to like Pika, for example, you know these guys started with video models now it's like create a Pika agent and what they have is you know you can customize it the way it looks and chat with it but they also have live avatars you can also plug that into your OpenClaw so it's pretty expensive right now but you can talk to your OpenClaw like this. You know again meet you where you are you can pick up the phone to it. And the people that are successful in open core are actually the ones that treated it a bit like an employee. Like your personal assistant, if you just give them a few things, you don't spend time with them. You can't really onboard them properly. Yet somehow we expect the AIs to do that, right? Like why aren't you doing it properly? Why aren't you customizing to me? And so the way that people onboard is literally like just having a chat, you know, like when you install Excalidraw skill or Figma or something like that, like your agents can now literally do entire mood boards and other stuff. They can use Notion to do presentations that will pitch to you. Like you'll probably just dump everything you know into there or connect it and it'll come back and say, 'Hey, David, this is how to organize your life. You know, you don't need 23 agents, you just need me.' And it will be having a chat that way.

D

David1:20:59

Well, even yesterday, OpenClaw released a great upgrade where now it sort of infers the commitments or reminders that it should do for you. So instead of having to tell it explicitly create me a reminder, create me a cron job for XYZ, if you told it oh I need to send this to a client by 9:00 PM on Friday it's going to automatically do that process, come back to you, remind you, you know, 8:00 p.m. on Friday like oh did you remember to send you know that thing to the client, right? And so I think you're right a lot of this is going to be as it gets more intelligent it's going to be able to pick up my intention with less explicit direction, right? Just a normal conversation.

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Emad Mostaque1:21:44

Again this is the intentional building, right? Like how unique are you as a snowflake, you know you got this, you got a bunch of stuff that is actually very normal. And these are skills that you kind of embed. So something like we have our agent platform III Agent that's about to get a whole host of upgrades and all the functionality and things like we built that very intentionally to do stuff by default. So it builds amazing presentations. It builds amazing websites, but then it's going to have a whole bunch of things like wedding planning and other stuff, you know, end to end as like fully integrated skills because we're like when you go out into the world, you wear different hats at different times. Yep. So why not just have a skill for religious institutions, a skill for weddings, a skill for organizing family vacations, you know, and that reduces the number of tokens you need, but increases the quality because again people in that I think again that's what people will build and that's how customized verticalized software has classically worked. I saw that there was I think it's called Owner. They're a CMO platform basically for restaurants and they've increased restaurant revenue of their customers by a billion dollars. So now for any restaurant they automatically create the website, all of the marketing materials, menus, etc. You're like, 'Okay, that's focused on restaurants, right? They're going to do a great job for restaurants.' Like you're like that's really interesting because again although you can build everything building the right thing to remove the frictions and then getting value from that is incredibly powerful like those restaurants aren't going to switch and run their own agents and things like that, right? Like again the tail is long for this.

D

David1:23:35

See this is where I find it all a little depressing because I'm like you know we're going to find out we're not really we're not unique snowflakes Emad we have 99.5% of the same stuff with that extra 0.5 being the difference a lot of the time.

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Emad Mostaque1:23:51

No, but I think Emad's making an important point is you're going to need sherpas, advocates. You're going to need people to fill it.

D

David1:24:01

How big is wealth management currently for companies? A lot of the time you could invest in mutual funds or ETFs on your own and do just as well. I mean, granted, not to say that those wealth management companies don't do well by their clients. They do. I have family that work in them. So, it's taking something that most people should be able to figure out on their own, realizing they're not going to do the work and the effort and pay attention to it to figure it out on their own. So, providing a service, but you could just extrapolate that with AI to everything. Because people aren't going to want to do it themselves. It's like self-custody with crypto. I used to be the biggest believer in self-custody until I realized it's totally a meme because, well, it's not in the sense that you can do it, but it is in the sense that most people are never going to do it because they're not going to take the time to learn. At least not on their own.

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Emad Mostaque1:24:54

Depends on how many Mt. Gox and things you've been in.

D

David1:24:57

Fair enough. Yeah. Well, no, but I mean like, yeah, fair point. But I mean like there will be...

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Emad Mostaque1:25:03

People, I told people none of the exchanges I used in 2012 still exist. And the only reason I have any crypto is because of self-custody. But to your point, Bo, it's been such a technical barrier that for most people, that's when they just walk away.

D

David1:25:18

Well, the irony will be self-custody as a service, you know, and that's kind of like...

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Emad Mostaque1:25:24

But this is one of the first things I rolled into the Morpheus skill was a wallet and the self-custody aspects handled for you by your agent. So now you didn't have to be a security expert, right, to check that credentials were stored correctly and all of these other things. And that took a lot of effort. But if we, like you're saying, by intentionality can set it up for people in a default where it is safe, all of a sudden they get those benefits without having to have all of that technical acumen.

D

David1:25:55

Yeah.

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Emad Mostaque1:25:56

Yeah. I think again this idiot tax thing, but there is a value thing like people's cognitive load is quite minimal. Like right now, how hard is an agent to use? It's not that hard. How hard is it to master? You have to know it pretty well. Like power users like ourselves, we know the ins and outs of where the AI breaks and what's it good at and so you got a multiplier effect on that. Whereas the vast majority of people never get there. Vast majority of people still use the free ChatGPT and think that's what the best thing is. And there's a world of difference between 5.5 base and thinking and pro, you know, and codex, etc. It's like how you use Gemini, the Gemini app is really bad. AI Studio it's better, API it's pretty good, you know, but again most people aren't even exposed to the top level AI. So I think the frictions will continue reducing but then you get to a really uncomfortable thing in a year or so and I put like there's about two years max for this from almost every single job you can do on the other side of a computer where the CEO pushes a button and then the AI agent sweeps every single thing every employee has ever done and all their details and creates digital clones of all of them that never sleep, tax deductible, and the company keeps running and nobody knows they've been replaced. Who's been replaced? You can kind of just imagine this as kind of a skit. Like literally...

D

David1:27:20

What? Hey Bob, how you doing? How's your wife? Well, she's doing well. It's like, it's a freaking GPU.

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Emad Mostaque1:27:24

Oh, they don't... Oh, you're saying they don't realize that it's not actually their coworker. Oh, that's good.

D

David1:27:29

Yeah, that's good.

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Emad Mostaque1:27:31

It'll be one button push and then Bob is replicated.

D

David1:27:34

Sure. And actually, that's... Yeah, they announced their... every keystroke to your point. Every keystroke.

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Emad Mostaque1:27:41

They're going to replace every Meta mate. And Mark in his kind of thing said you on average you guys have a higher IQ than most data labelers. So we're going to train on you basically to replace you. Like what the hell? Like of course they're going to replace all these people. Like they're going to do what Jack Dorsey did but it's not going to be minus 40%. How many people are needed to run Meta? 10 times less.

D

David1:28:12

We know this.

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Emad Mostaque1:28:13

Yeah.

D

David1:28:14

Well, and that goes back to the importance of having your own agent. I think you're gonna bring it with you to everything you do, just like you bring your computer or your phone or your network or your relationships, you're going to want to own that agent. And if you don't own that agent, that's going to be your experience the next few years is anywhere you go, the company will capture those processes, internalize them, say thanks, and see you later. Right.

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Emad Mostaque1:28:41

Thought of even simpler. If your company, if your job is to be like a machine, the machine can do it better.

D

David1:28:48

Yeah.

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Emad Mostaque1:28:49

Ready?

D

David1:28:50

Well, okay. Okay, so this brings me to my next idea, which when Agent Bo replaces Real Bo, Amish V2, which is just going to be we take a snapshot of like 2007 society, maybe like 2019, and we're like, 'All right, that's the cut off. No tech beyond that, and it's just a new type of, you know, Amish person basically.'

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Emad Mostaque1:29:16

And I think there will be people who do that. I joke but I actually do think there will be groups of people who do that who are basically like, 'All right, we don't use AI so we use everything else other than AI.' I don't think it'll be that big but I think you will see a big increasing backlash. A lot of the top CEOs in AI I know now have canceled almost all their public events. You know it's like if you're in crypto now don't go to France, you know, it's the same thing.

D

David1:29:47

It'll kind of be funny politically how this will definitely emerge as a liberal ideology, but then it'll ultimately definitionally become a conservative ideology because they'll be wanting to conserve things like the way that it was. Although the initial idea of probably saying well to like robot rights like we don't want to replace people blah blah blah will probably and already is largely emerging as like a liberal stance at least in America.

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Emad Mostaque1:30:18

Sanders right now. He's like, 'AI is going to kill us all.'

D

David1:30:22

Yeah. He's like, 'Well, you said P50 Emad. You gave us a 50/50 shot.' So...

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Emad Mostaque1:30:29

I'm trying to get it evens, right? Like, I mean, there's so many ways, you know, like my most concrete way is you have a billion robots and a bad firmware upgrade and they twist off our heads. You know, I've got a very active imagination on all these other things. But the other side, like I said, is Star Trek. And the key to my robot and to, you know, having pushing the button on that firmware update, you know, not be a one central point to your point is important.

D

David1:31:00

Yeah, I've got all these robots on order and I've got I've separated them between like home, garden, and fighting ring, you know.

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Emad Mostaque1:31:08

And we kind of got to see these things. Like, have you guys seen the Engine AI T800?

D

David1:31:13

No. Let me look that one up. I was on a robot kick yesterday. But I have not seen this one.

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Emad Mostaque1:31:19

So, first off, they called it the T800. Right. You're a Terminator. Yeah. So, the T800 is like 6 foot tall, weighs 80 kg. And can punch five times harder than Mike Tyson. And it's $20,000. So, it's like, why would you even do that? Like that could punch through someone. And so all the videos of it are doing kung fu and things. So they have a robot fighting competition coming where they have the full sim to real thing whereby, you know, Real Steel. I don't know if you've seen that with Hugh Jackman.

D

David1:31:51

Yeah. Yeah.

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Emad Mostaque1:31:51

Where they doing that? The T800s can do that. So on the one hand, very cool. On the other hand, you should never let these things walk in the street, you know, like again twist someone's head off. But yeah.

D

David1:32:04

How far along? Like does this exist already? Like they already have.

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Emad Mostaque1:32:09

Yeah, they're real, right? The videos are real. I've seen it in real.

D

David1:32:12

I'm looking at one, but it looks like not real. But okay, I believe you. Hang on. Let me see.

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Emad Mostaque1:32:15

Yeah, when it first came out because they shot it really well, everyone was like, 'This is AI generated content.' They were like, 'Sorry, we have high production values. Here's the videos.'

D

David1:32:26

Oh, I don't... I simultaneously hate this and love it at the same time. This gives me like the weirdest feelings, man. This is like so crazy.

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Emad Mostaque1:32:34

Like I said, that one is for the fighting ring and it's not allowed in the house. But when we're going to have to, again, this is a very real thing. Should you allow a robot that can punch five times harder than Mike Tyson on the streets?

D

David1:32:52

I don't know. Yeah.

E

Emad Mostaque1:32:53

But then you see like again the 1X robots that look all neat and stuff.

D

David1:32:57

Or you go full Texas and everybody has one and it's a very polite society because everyone is armed and that's the expectation and you don't break into anyone's house and you don't rob anybody, right? You know, does crime go to zero, right? So...

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Emad Mostaque1:33:12

The crime goes to zero. Like you go out and there's a bunch of drones around you, right? Like why not? This is a very strange society that we're heading towards right now. And again like so for robotics it's interesting because the satisficing point of robotics with the right diffusion technologies is you need an 8 billion parameter model to navigate the world. That's it. And the on-policy learning like 16 gigabytes of RAM roughly will give you a robot that can read a recipe from a book and make it. And so the actual amount of computation in these required is very little. And you can just see that from, you know, the Unitree G1, the most famous robot of all at the moment that you see from Unitree.

D

David1:34:01

Look at where it started and what it can do to what it can do now.

E

Emad Mostaque1:34:04

Yep. And that's like a $6,000 bill of material. In fact, the new R1 robot that they have is $6,000. And the new one they just announced, which actually doesn't have legs, but goes on this wheelie base, is $4,000.

D

David1:34:21

I love... Yeah, I saw that. It's like 4260 or something like that. Yeah. I love if you click on the Unitree G1 to order one, the very first picture is it throwing a roundhouse kick.

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Emad Mostaque1:34:34

Oh man. Well, like if I wasn't trying to like do all this sovereign AI stuff, try to navigate this, I would definitely be building giant fights.

D

David1:34:41

Yeah, I was going to say what else would you be doing about building like mechs?

E

Emad Mostaque1:34:45

I would be building Gundams, man. Like now is the time. Like proper mech-sized robots. Why? Because like now's the time.

D

David1:34:52

I saw Palmer Luckey talk about this on a podcast and he was saying basically that like he was like at some point I'm going to build a mech. He was like because it's just something I want to do. He was like but the thing that people get wrong probably is like you won't have a person inside of it because a person won't be able to withstand like any of the stuff that you're watching in Gundam or anything like that.

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Emad Mostaque1:35:12

Oh yeah. They completely get squished.

D

David1:35:14

Yeah, definitely. And that's I guess what they're doing with some of their drones like as assistants to fighter pilots is he's like they can make maneuvers and things that a human could never make.

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Emad Mostaque1:35:27

So the amount of compute required to beat a top fighter pilot right now is a Raspberry Pi with the current algorithms that we have. So yeah, you shouldn't have humans, but I kind of still want to build giant robots, you know.

D

David1:35:41

Yeah. Yeah. The drone warfare is going to get crazy. I mean, that's sort of the current conflict is really the first drone war, right? You know, I think Zelensky announced recently like they had taken some new territory and there was no humans involved. They had just sent ground drones and air drones and you know, the local militia or whatever surrendered and like they're just walking in. And so every country's military is going to be, you know, what access do they have to these type of tools, right? You know, and...

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Emad Mostaque1:36:14

I was just thinking about... they're not difficult to make. They're not difficult to make. I was just thinking about how time is such a flat circle and you know how during like the Revolutionary War and back when, you know, people were literally lining up like strategy was literally just stand across from each other, load one shot at a time and you would actually have people spectating war, right? Are we going to... is spectation of war going to exist again? Because you're going to just have all these mech robots and they're going to be trained like the engagement will be that, you know, hey, these attack the other mechs but they don't attack people. So then you're just sitting there watching it play out.

D

David1:36:51

Yeah. Hey, why don't just have a computer game where you're playing against each other, right? Like have competitive esports for war. But I think you're seeing less and less of this. You will see less and less of this because the asymmetry and the attack defense powers are just off the charts. And the drones have got so good that they are basically smart bullets. I mean, it's cool in one way. Like I don't know if you've seen the anti-gravity drone. That's a really cool one. So, anti-gravity drone. Let me see if I can just...

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Emad Mostaque1:37:20

Oh, you have one.

D

David1:37:23

I wasn't expecting you to be like, 'Oh, anti-gravity. Here, check this out.'

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Emad Mostaque1:37:26

Here we go. So, you put on these goggles. Yep. Which are kind of cool. You know, they got the little things.

D

David1:37:32

And then on, can you put them on really quick so I can use it as a picture for the thumbnail? It'll make a really good thumbnail.

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Emad Mostaque1:37:39

Make a really good thumbnail. Okay. Let me see... you. Be the world's most epic podcast. There. There you go. There we go. Oh, I need to turn.

D

David1:37:49

There we go. So, let me just see if I can turn this on. Where's the...

E

Emad Mostaque1:37:52

That is fantastic.

D

David1:37:54

Oh, does it light up? Is it got like...

E

Emad Mostaque1:37:56

Oh, yeah. No, it lights up and everything. Um, to find the on button. So, but this is really interesting because this is a drone. This is my latest favorite toy because we like the voice.

D

David1:38:05

That is the drone, right?

E

Emad Mostaque1:38:07

Yeah.

D

David1:38:07

Wow.

E

Emad Mostaque1:38:08

This is an 8K 360-degree drone. So, when you put on your lovely little ant face and it lights up, you can look around in 360 degrees from that drone and like they're so small now and they're so powerful and you can control it just with your fingers that it's really cool, but at the same time, it's like really, really, really scary. So, it's always this combination of cool and scary that we're in now because again, we're in this weird sci-fi future that we were never in before, right?

D

David1:38:42

Yeah. What do these things cost? Oh, I'm looking right now. It's like $1,200. Wow. That is shockingly cheap, too, for how like...

E

Emad Mostaque1:38:49

Yeah, for an 8K 360-degree drone.

D

David1:38:53

Like, this would have been magic five years ago.

E

Emad Mostaque1:38:58

Sufficiently advanced technology is magic.

D

David1:39:01

Yeah, true.

E

Emad Mostaque1:39:02

Well, it sounds like I'm going to need like a cloud of personal drones that protect me as I go around town from random attack. The Mike Tyson bot that's going to be hiding around the corner.

D

David1:39:13

Yeah. Yeah. Well, well, you know, every car you've got, you know, your fleet of three that are flying behind the car and then you have, you know, your Tyson bot that comes with you.

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Emad Mostaque1:39:24

There is something so awesome about when... deploy, deploy.

D

David1:39:28

There's something so great still about when the robots like mess up, though. Did you see the China just had the couple run the half marathon and the one that won just like sped through the finish line and crashed into the wall at the end and it was so good. It was so awesome. I was like these are the greatest.

E

Emad Mostaque1:39:45

These are the greatest. But I mean yeah like you it's going to you will see just very mundane things on the other side like the robot will walk your dog.

D

David1:39:55

Yeah, sure.

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Emad Mostaque1:39:57

Like I did an experiment with this. I actually got my Unitree G2. I hooked it up to walk our dog in the park. People were looking at it because it was like the robot dog walking the robot dog.

D

David1:40:08

Where do you keep these things? Do you just have like a lineup of these things somewhere in your house or something?

E

Emad Mostaque1:40:14

I have a little robot room. Yeah, my toys. I've been trying to get a lab, but the missus hasn't allowed me yet. But I will get my robot lab.

D

David1:40:22

A robot lab?

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Emad Mostaque1:40:24

Robot lab? It's inevitable. Why wouldn't you have a robot lab again? These things you look at them a year ago and they're like spazzing out everywhere and now they're doing kung fu and break dancing and all sorts of stuff like and they cost less than a motorcycle, you know.

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David1:40:41

Yeah like is that how you negotiate with your wife or you're like okay listen it's motorcycle or a new robot and...

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Emad Mostaque1:40:50

I'm just like look if we're going to have a midlife crisis it's this or a Harley right. Let me get my fighter robot on.

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David1:40:58

You'll be able to put your robot on the Harley and then wear the immersion glasses and it'll be just like you're on it.

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Emad Mostaque1:41:05

Yeah. Well, we are doing something like that actually. We're making a kit with motorcycles. So, a kit from Knight Rider, but for motorcycles with bone conduction headphones and augmented reality. That's one of the side projects because again, you just can do it. Why not? Yep. Why don't you have it? Why don't you get into your car and it's like, 'Hello, man. How are you today? Let's go on an adventure.' Been having a lot of fun. I mean, 20 years of backlog of ideas and concepts and things I've wanted to do and never had time and all of a sudden I'm clearing that backlog, right? So...

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David1:41:37

Yeah.

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Emad Mostaque1:41:38

It's just getting it done again. But once it's done, it can be replicated, right? And where are we going? We're going to Jarvis and Iron Man, you know, like right now we're using our agent and I'm adjusting it for the house to be a full house control system. So, I've got my 5090s. I have my 128 GB chips. I'm creating a house mesh where I can come and talk to it. I even got a Samsung Odyssey monitor. I don't know if you've seen one of those.

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David1:42:07

Yeah, those are crazy. They're huge, David. It's like I don't know how to describe it. It's like this massive thing that basically wraps around you. Not really, but like it's huge.

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Emad Mostaque1:42:16

Not that one. I got the 3D one. So it's glasses-free 3D. So when you go into the room, the AI is there in 3D without glasses. And so again, getting real creepy real quick, but at the same time, once I've got that, I'll probably open source it because then you have Jarvis at home on a mesh. So I'm using Exolabs at the moment to mesh the different things. I'm testing out the different models. It can do everything from like make a dynamic music track with a step to like I built a Weasley clock, you know, from Harry Potter.

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David1:42:52

Yeah.

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Emad Mostaque1:42:52

So, it checks where the family is and like goes like that. Like, how cool is this? It's the coolest and scariest type.

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David1:42:59

All the decks and replicators. We're going to get it all.

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Emad Mostaque1:43:02

I don't know if you... This might have been after you guys. Like you might have been maybe not too for this, but I cannot wait for someone to make the full-scale Yu-Gi-Oh card game where like you place the card down and the monster like comes up to life and then you can play it in real life. That's how it works in the show in like the early 2000s and we're like right there like it's going to be here very soon.

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David1:43:23

Well, again with the AR glasses or your Vision Pros or kind of whatever you can kind of see that, right? And just build it. Build your Yu-Gi-Oh game. Tell your codex to go and do that and download the assets. Like the new GPT image is so amazing. Like I did a periodic table of first generation Pokémon and it just generated all 151 of them with accurate numbers.

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Emad Mostaque1:43:46

Like you can just take that and you can make all the Yu-Gi-Oh cards and it's just an iterative loop, right, where it just keeps on checking. It keeps on going through until it actually gets there. And I think this holodeck experience, so I was speaking at Rendercon because I'm on the board of Render. You can look at my Twitter. There's a talk. I gave a talk on the holodeck and building the holodeck. I think we have everything apart from the hard light holograms. That's a bit difficult to actually build a holodeck experience where you can just go and you can talk and you can build that whole thing in 4K, 8K. And again, how crazy is that? I want to build a Yu-Gi-Oh game. I want to have all the assets bought in. But that's why then Yu-Gi-Oh IP could be way bigger even now than it is.

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David1:44:27

Yeah. Yeah, that's true. You touched on that before, but IP is going to be well one incredibly difficult to enforce, but two when it can be enforced, incredibly valuable. I mean, I think about this with non-fungible agents. Like if you can effectively like agentically somehow download basically the consciousness of like an artist or something like this and now you don't just own their music catalog, you actually own their brain which can be used to make new music and some version of this.

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Emad Mostaque1:45:00

Yeah, I mean I think Grimes has open sourced all her stuff. So you could start with Grimes, download her brain and kind of get that going for...

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David1:45:08

I'm sure Elon has multiple copies of Grimes's brain, I would imagine.

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Emad Mostaque1:45:12

Maybe, maybe. I mean, I think again, this is where I wish we'd see more innovation. Like, I had an idea a while ago, like you have nouns now, right? But why aren't the nouns prompts that can be remixed and pushed through a flux or stable diffusion type model into a seedance? So, you have entire universes being autogenerated. Like, I don't know, maybe you should do that because that type of thing is fun. Like, why do you need ASKI anymore? A single hash to a blockchain can be a whole universe.

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David1:45:42

Well, and this is why well, we're never going to satiate the demand for tokens. We might satiate it for text tokens. Maybe for image, but everybody has their own universe, you know, holodeck kind of stuff is going to consume a lot more tokens and it's going to all be in visual and video and AR and, you know, VR and all these different experiences. I remember the early days of Second Life. You remember that back in 2005? I always think of the office episode where Dwight's like obsessed with Second Life.

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Emad Mostaque1:46:14

Well, people were really adopting it and it was so cool and it was so ahead of its time because of the Linden dollar. It had one of the first virtual currencies, but it was all centralized and the government basically came in in 2007. It was like, you can't let people do gambling and stock markets and money remittance and all these things. And they basically shut down all of its interesting use cases and it just became another game, right? Just one with sort of a unique way to create objects and own them, but it really limited its potential. It was on this amazing hockey stick of growth. And I feel like 20 years later, we're finally back to the point where we have all the decentralized pieces, right, with digital currency and smart contracts and all of this that we've rebuilt everything you would need to build a proper Second Life today that the government can't come in and basically shut down all of the most interesting use cases. And I wonder if the moment has passed or whether it's just been sort of this latent ban and now the technology is getting to a point where we're going to see something like that emerge again.

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David1:47:21

This is my other dream, David. I want to buy Jagex and bring old school RuneScape on chain and turn it into a real economy.

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Emad Mostaque1:47:29

There you go.

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David1:47:30

That's where I learned economics.

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Emad Mostaque1:47:34

Yeah. Their own recently.

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David1:47:36

Yeah. I remember I did a bit of advising on that deal. But actually, that's one of the biggest disappointments that I've had in crypto. And I've had many, as I'm sure you guys have, right? $4.6 billion or something crazy like that. I think I calculated once, has gone into web3 gaming. Not a single good MMO. Seriously.

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Emad Mostaque1:47:57

Yeah.

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David1:47:58

You know, like it's a bit crazy.

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Emad Mostaque1:48:01

Like I was like maybe I can create something where everyone can contribute their open claws and Hermes agent cycles and then we collaboratively build one, you know, like there's a gap there.

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David1:48:12

What do you think is stopping that development? Because it's certainly not capital to your point.

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Emad Mostaque1:48:17

Well it was talent and people that build games. There was a big gap between them and people that actually were using this for on-chain speculation. You know, the one project I thought that was interesting was Neal Stephenson created Lamina1, right? And was picking people that were specifically game and MMO builders, right? And real designers. But even he was sort of early. I think that was in 21, 22, 2023 and it just got launched recently. And I believe they built the early stack on Avalanche, right, for speed, and then they ultimately, I believe, pivoted to a second layer on Ethereum, partnering with Joe Lubin and Consensys and folks like that. So even there, you know, I think you needed the tech to catch up because nobody wanted to wait, you know, a minute for something to happen. Nobody wants those latencies in a game. I don't know. That's my perspective. I mean, I used to be a video game investor when I was a hedge fund manager. I was a pro gamer for a bit and it was all about fun, flow, and frustration. Minimize frustration, increase the fun and the flow. Like most people put the blockchain and the token first and hope to kind of launch that. But again, I think there is a big gap for MMO type proper economy that you can go back in the RuneScape days. You know, I used to hire a lot of guild leaders from World of Warcraft and things like that. You can learn a lot.

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David1:49:55

That's how I learned economics prior. So early RuneScape there was no... well they introduced an exchange which is like a central kind of marketplace but there wasn't, there was all peer-to-peer trading and I learned how to not get scammed. I'm telling you I've avoided so many crypto scams and getting rugged simply because I grew up in the MMO world learning how someone's going to try to scam me in various ways. You know it's... what was your game mod? You said you did some professional gaming.

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Emad Mostaque1:50:22

Yeah, it was Unreal Tournament, Team Fortress 2, and then there was multi-legend competitive Hearthstone.

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David1:50:30

Interesting.

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Emad Mostaque1:50:32

Mods had like 15 careers.

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David1:50:34

Yeah, I was going to say that's amazing. 90 different positions and titles and you know...

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Emad Mostaque1:50:39

You know, you just got to keep busy with the ADHD. ADHD is fantastic for us with this computing now with agents, right? You're just like, 'Go in my ADHD. Be free. Let me shift between everything.' But yeah, I think game economies again are a reflection. We had again in science fiction the Oasis and kind of other things. They become very interesting because how do you gamify life? How do you reward people? How do you build stronger communities? We've had so many good things in crypto that kind of just never quite got there. Like how do you build NFT communities, right? How do you build DAOs? How do you build all of this? And now I think people are just a bit burned out by everything in crypto to be honest. We need to have some good stuff coming through.

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David1:51:24

Well, my hope is that AI provides the UI, right? And so many of the things that got built in crypto really belong in the back end, right? They're infrastructure for, you know, trust, they're the currency layer, they're the incentives, they're, you know, providing the inference or the compute, you know, like what Morpheus is doing. But most people don't want to run their own node. They don't want to go through that friction. And so, you know, that's I think been the magical thing for me is now I have my agent do that, right? Running up a node became trivial. Go ahead and do it. You know, go ahead and spin it up, read the documentation, go nuts. And five minutes later, now I have the peer-to-peer access to the system that would have been, you know, hours and a weekend figuring it all out, you know, and most people aren't willing to do that. So, you know, I think we sort of have to almost rethink what are the things that didn't work because of that high friction and what things are sort of going to flow back in now that that friction no longer exists, right? And which can we just build into, you know, defaults in the background and it happens for people automatically, right? So, but no, I think that's going to be the fun part of the next few years. You can sort of reimagine like you're saying when there's one of these big waves of change happening people are willing to reassess things that they've held for...

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Emad Mostaque1:52:48

Yeah, I think again it's like coming together like, you know, as you said Bo, you wish you could bring back RuneScape, right? And...

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David1:52:56

Well yeah the game itself actually has the most live players today than it's ever had oddly enough but I want to bring it on chain.

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Emad Mostaque1:53:03

Well but this is the thing like what does it look like in a few years you find a bunch of people like you, you build a community and then you just point your agents to start building the assets. You talk about all the things you hated about it. You think about all the things you liked and then it starts generating and then boom, probably a few months later you actually have a game that people can join. Like we saw Levels.io Peter on Twitter was creating this multiplayer like fighter game, airplane game, right, where people were sponsoring stuff and things like it went to the wayside. But I think you'll see these community coordinated projects from people with the right ideas coordinating better really come to the fore because again what is the limit to recreating RuneScape right now?

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David1:53:51

Not a lot.

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Emad Mostaque1:53:52

There's a lot of barriers in a year, far less in two years.

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David1:53:56

Yeah. You get your mates around, you build RuneScape, right?

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Emad Mostaque1:53:59

Yeah. You get it to do the autobalancing. You get it to create visuals. You get it to create marketing campaigns. You get users coming on. And again that is just super interesting because we could build bigger and better things and maybe that again is the next generation of crypto, right? Like participation has become farming airdrops, which is like whatever, right?

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David1:54:24

Yeah. Right.

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Emad Mostaque1:54:26

How do you make it genuine? How do you make it authentic? And that's actually what I think is going to happen to your point about I actually think in person becomes more valuable because so much of the fake content it's just noise right and you know I think the experiential I think the relational I think spending time with humans like that's what I want to do is not be staring at the screen I want to go play with my kids right, you know.

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David1:54:55

Yeah. Well, I think shows like this, I mean, even Brain Power, we have like a couple a year or two left before I could be interviewing Agent Emad and not know it, you know, and I don't know, with your background, I might currently be interviewing Agent Emad. And I guess I wouldn't necessarily know the difference, but...

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Emad Mostaque1:55:16

Well, I mean, you could, but again, it's always nicer to have it in person. This is the real event, maybe.

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David1:55:21

Yeah, the goggles is how I know you're real. No, you could. Not even AI could fake that.

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Emad Mostaque1:55:28

But you know, I think the real world experiences, but this is what's the really interesting thing that I've been telling a lot of people recently, like the other thing about using AI is a very single player experience. And you kind of run out a bit of juice after a while, unless you're super ADHD like, you know, myself or maybe some of the others, right? It's a lot more fun when you create as a group. So, like one of the things I'd highly recommend to everyone is get a bunch of mates around and make a music album and music videos and actually do it collaboratively. And you'll see that's a completely different way to use AI because if you sit down and you do it yourself, you're like just that chatting back and forth. Like the way I put it is eating by yourself isn't as good as eating with your family isn't as good as making dinner with your family. Like maybe you don't do it all the time, you know, but definitely you'll be stronger as a unit if you actually do that. Similarly, this multiplayer generous of AI is not something that we've really seen in a social sense. In a business sense, we're starting to see the first elements. You're passing things back and forth. But jamming and creating, we haven't seen that at all. Like again, I can make a movie with a new IP, you know, about the return to RuneScape, you know, and have that whole world in the style of, I don't know, like Pixar animation, pick whatever, right?

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David1:56:59

Yeah.

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Emad Mostaque1:57:00

Or Arcane. You have it in the style of Arcane. RuneScape in the style of Arcane, a whole TV series, but you'll get tired after a while. Whereas, if you actually built it with other people that love it, that's a whole different story, right?

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David1:57:08

Yeah. Oh, I totally agree with this. So, one of my wife and I on one of our first dates, I think it was like our second time ever meeting each other. We collaboratively wrote a fake script for Osmosis Jones 2 the movie because we said that Osmosis Jones should have had a sequel and it never did. And think about that like you could sit down on a date and make Osmosis Jones 2 the movie and then watch it, you know...

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Emad Mostaque1:57:33

And then now your wife knows what you're doing for your next date. Eh...

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David1:57:36

Yeah, true. I need to... that'll be a great like anniversary gift at some point. So I'll deliver Osmosis Jones 2. Yeah, that's good.

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Emad Mostaque1:57:45

Again, there's this whole area that we haven't explored where the AI is removing friction to enable us to have flow and fun, right? Okay, you make mistakes, but you know, it's a lot more fun to make mistakes with other people, have that in person. That's why I think the types of things we build will get bigger and better and again more original as we go forward. Like again, I've got a million ideas about how to make good games because I invested in games and I played games, but how many of them could I make?

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David1:58:12

Yeah.

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Emad Mostaque1:58:12

Well, you'll see some games I make in the next period, but I won't make them myself. You know, I'll find people that want to build these types of games with me because it's a lot more fun. And that kind of brings me down to again like when we were playing these MMOs and the World of Warcraft, I played a lot of Guild Wars and things like you, it's not actually antisocial. It's actually very, very social, you know. But we don't have those experiences right now. Maybe because life got in the way. You had kids and things, but you're like there is a gap there.

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David1:58:42

Yep. Yeah. For a while, World of Warcraft was like golf for... like that's when you went and hung out with your friends for a couple hours and Yeah. I think there's definitely a gap there. And so I think that's inevitable. As soon as everybody has an agent, I want my agent to talk to my buddy's agent, right? And go figure things out and find ways to make fun and entertainment for us and all the rest, right? So, I think you're going to have, you know, a huge amount of that unlock. You know, and it's just getting to the point where my agent can have context over what are my relationships, what is the context I have with them, how not to, you know, spill out all my private information in every context, right? But it's getting better, right? A lot of the releases even just I was looking at the April 29th release of Open Claw and they've tried to basically figure out okay how can I put it in a group chat but it not make all these mistakes or constantly chat about its thinking process instead of just coming back when it has something substantive. But my daughter has come up with this concept of buddy bots and I was like, 'Oh, I'm gonna code that up and open source that and release that.' And I think that'll actually be really interesting.

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Emad Mostaque2:00:05

Yeah. Yeah. I think you know there's a lot of interest capital and other things flowing like I think of Star Citizen, right? You seen that on Kickstarter?

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David2:00:13

Mhm.

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Emad Mostaque2:00:13

Do you know how much Star Citizen has raised so far?

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David2:00:17

$968 million.

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Emad Mostaque2:00:20

Wow. Last year it did 152. It's about to cross a billion dollars in ship sales. It's not very fun, but people feel a part of it, right? And there's no crypto or anything in there. And then you're like, come on, we can do better, right? Like build stuff people want. Build stuff that is fun. And then again, this is the very exciting thing because what should we be doing in a Star Trek universe? We should be building experiences, interacting with each other, exploring our internal state and the external universe. Like I think physics will be solved soon. So, you know, need to worry about that. But...

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David2:00:55

That'd be pretty cool if you solved physics. I'd like to be able to be like, I talked to the guy that solved physics. Einstein. No, the other one. The other guy.

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Emad Mostaque2:01:03

Oh, well. Well, look, like I said, you can go and look at the website right now. We've already improved relativity. Like...

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David2:01:08

Yeah, true. Fair enough. There's a lot...

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Emad Mostaque2:01:13

A lot of our problems are just because we have these assumptions, right? But how many people can be involved in something like physics? If the foundation is there, then there's a whole universe to explore still, right?

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David2:01:26

Mhm.

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Emad Mostaque2:01:26

The human intellect, ingenuity, there's so many stories to tell. And again, you're never going to replace the time you spend with your kids or you don't spend enough time with your mom or your dad. I can guarantee that, right? Like so the whole purpose of this technology should be sovereignty enablement. You know it should be freeing us up again from that 7-day work week. So the 5-day work week to why should you work at all?

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David2:01:53

Yeah. Like again that's a social contract question though because in this interim period it's just like foundation like our infrastructure our society democracy and capitalism are going to change and we need to figure out what is our new social contract on the other side.

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Emad Mostaque2:02:09

Mhm.

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David2:02:10

Yeah.

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Emad Mostaque2:02:11

Well we're across the 2-hour mark and as much as I would love to hold you hostage forever and I would, I truly would because I have endless things I can learn from you. I do want to be conscious of your time as well, but before we get out of here, I guess I just want to ask what for someone listening to this, what is the best way for them to dive into the Emad universe? Is it Intelligent Internet starting there?

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David2:02:37

Yeah, you can go to iii.inc, check out my book, The Last Economy there and all stuff there or follow me on Twitter.

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Emad Mostaque2:02:45

Thank you, Emad. Thank you so much for jumping on. I really, really appreciate the time.

D

David2:02:49

Yeah, cheers. This has been really awesome. So glad to go deep with you and thank you for everything you're building. I think it's really important. I think it's going to have a very substantive impact on the future and a lot of people's lives. So keep on being awesome.

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Emad Mostaque2:03:05

You're listening to Brain Power.

The Founder of Intelligent Internet (ii.inc) has a 50% P(Doom) & is Building Anyway | Emad Mostaque

About Emad Mostaque