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Binance Founder Ignites Hot Debate on Whether AI Projects Belong on L1 or L2 Blockchains

Binance Founder Ignites Hot Debate on Whether AI Projects Belong on L1 or L2 Blockchains

Binance founder Changpeng Zhao has reignited debate within the cryptocurrency community. The former CEO questioned whether artificial intelligence blockchain projects should be built on Layer 1 or Layer 2 networks.

Zhao, commonly known as CZ, posted on X (formerly Twitter) seeking industry perspectives. “L1 vs L2…Does it matter if a new AI project is an L1 or an L2?… Is L1 cooler than L2 or the reverse? Old topic, but wondering if sentiment has changed or not,” he wrote.

The discussion emerges as AI and blockchain convergence becomes a focal point for developers and investors. Industry participants are increasingly focused on finding the optimal architecture for these emerging technologies.

CZ emphasized that the primary goal isn’t developing superior blockchain technology. Rather, he noted, it’s using blockchain to support AI economics. His comments highlight the practical considerations facing project developers.

Blockchain Architecture Options

Layer 1 networks provide greater sovereignty and decentralization but require more maintenance work. These networks demand significant resources for node and validator operations. Many developers consider this additional control worthwhile despite the higher resource requirements.

Layer 2 solutions offer convenience by leveraging existing ecosystems like Ethereum’s exchanges and tools. This approach allows teams to build on established infrastructure without significant value leakage to the base layer. Development cycles can be substantially shorter with this approach.

Crypto analyst Hitesh Malviya favors Layer 1 for specific projects. He advocates this approach for teams seeking their own consensus mechanisms and reduced validator costs.

“Even if you retain users, you would only see one category or niche capturing the maximum traction onchain,” Malviya noted. He warned that many Layer 1 projects experience 70-90% user retention drops after token generation events.

Given these challenges, Malviya suggests building AI blockchains as Layer 2 app chains. This approach enables faster development and scalability. Walter from BNB Chain’s Business Development team similarly supports Layer 2 solutions for their accessibility to existing tools.

Expanding the Debate Between Two Layers

Blockchain advisor Anndy Lian introduced another perspective. He argued that AI is most effectively deployed at Layer 3. “AI can be implemented on blockchain Layers 1, 2, or 3… In practice, Layer 3 is where AI is most effectively and frequently utilized,” Lian explained. According to Lian, implementing AI on Layer 1 is theoretically possible but impractical. Security and resource constraints make it difficult to execute effectively. Layer 3 enables diverse AI-powered applications while leveraging blockchain’s fundamental strengths.

CZ’s timing may suggest strategic planning. Binance Labs invested in Zircuit in June 2024, an AI-enhanced Layer 2 network using zero-knowledge rollups. This investment signals Binance’s interest in AI-blockchain integration and may explain his current market research.

Ethereum co-founder Vitalik Buterin has also contributed to scaling discussions. Last month, he outlined a roadmap for scaling Ethereum’s protocols in 2025. Buterin recently cautioned that certain Layer 2 networks will likely fail due to weak economic models.

The debate continues to evolve among major industry players. Tradeoffs between sovereignty, scalability, and accessibility will shape future AI-blockchain integration. Developers and investors must carefully consider these factors for upcoming projects.

 

Source: https://yellow.com/news/binance-founder-ignites-hot-debate-on-whether-ai-projects-belong-on-l1-or-l2-blockchains

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

Kaito AI airdrop sparks tokenomics, early selling concerns

Kaito AI airdrop sparks tokenomics, early selling concerns

Kaito AI, a crypto intelligence platform, has allocated nearly 20% of its token supply to future airdrops and incentives, fueling enthusiasm among early adopters while raising concerns over tokenomics.

The platform, which brands itself as the “ultimate Web3 information platform,” is preparing for its first airdrop, allocating 10% of its total token supply to its early community members and ecosystem participants.

“For the Initial Community and Ecosystem Claim – 10%. This allocation includes the initial Kaito Yapper community, Genesis NFT holders, and ecosystem yappers and partners,” Kaito AI wrote in a Feb. 20 X post.

According to the platform, 56.6% of the total supply will be distributed to the community and ecosystem, with 19.5% specifically designated for initial and long-term airdrops and incentives.

The platform is introducing new dynamics for the crypto marketing industry, according to Marcin Kazmierczak, co-founder and chief operating officer of RedStone, a blockchain oracle solution firm.

“Currently, I do not know a single serious marketer that wouldn’t use Kaito stack,” he told Cointelegraph, adding:

“Kaito has changed the way crypto marketing operates. Previously, it was mainly about views and impressions, however, Kaito introduced a new metric, Smart Followers. It allows one to measure how many respected or active crypto accounts interacted with or followed a specific account.”

Despite the platform’s innovation, some analysts have expressed concerns over its tokenomics, particularly regarding the allocation to insiders, which could create selling pressure after the airdrop.

Kaito tokenomics spark allocation, selling concerns

Similar events are often riddled with airdrop squatters, or professional airdrop hunters, who farm protocols with an incoming airdrop in hopes of financial gain. In 2023, the Arbitrum (ARB) airdrop saw airdrop hunters consolidate $3.3 million worth of tokens.

Kazmierczak said Kaito’s airdrop structure is designed to prevent farming.

“Today’s airdrop allocation will be defined by the number of Yaps collected, which were very hard to bot, and Kaito genesis NFTs held at the snapshot.”

Still, onchain analysts have pointed out that a significant portion of the token supply is allocated to insiders. According to onchain investigator RunnerXBT, 43.3% of Kaito’s total supply is designated for insiders, including 35% for the team and 8.3% for early investors.

Cointelegraph has reached out to Kaito for comment but did not receive a reply by the time of publication.

Some analysts have also warned of a potential sell-off following the airdrop, particularly given the current market downturn.

Anndy Lian, an intergovernmental blockchain expert and author, suggested that Kaito’s token could follow a familiar pattern of hype-driven spikes followed by sharp declines:

“As for Kaito itself, I see a classic pattern: big hype, big spike, then a massive sell-off. Even if [the initial supply] is vested (which seems likely with allocations for liquidity and early backers), a lot of folks — especially those who farmed points just before with hyped airdrops: starts high, ends low.”

Crypto investor interest in airdrops saw an uptick on Jan. 15, after the total value of the Hyperliquid (HYPE) token airdrop soared to $7.5 billion, Cointelegraph reported.

 

 

Source: https://www.tradingview.com/news/cointelegraph:358b8509b094b:0-kaito-ai-airdrop-sparks-tokenomics-early-selling-concerns/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

Kaito AI airdrop sparks tokenomics, early selling concerns

Kaito AI airdrop sparks tokenomics, early selling concerns

Kaito AI, a crypto intelligence platform, has allocated nearly 20% of its token supply to future airdrops and incentives, fueling enthusiasm among early adopters while raising concerns over tokenomics.

The platform, which brands itself as the “ultimate Web3 information platform,” is preparing for its first airdrop, allocating 10% of its total token supply to its early community members and ecosystem participants.

“For the Initial Community and Ecosystem Claim – 10%. This allocation includes the initial Kaito Yapper community, Genesis NFT holders, and ecosystem yappers and partners,” Kaito AI wrote in a Feb. 20 X post.

According to the platform, 56.6% of the total supply will be distributed to the community and ecosystem, with 19.5% specifically designated for initial and long-term airdrops and incentives.

The platform is introducing new dynamics for the crypto marketing industry, according to Marcin Kazmierczak, co-founder and chief operating officer of RedStone, a blockchain oracle solution firm.

“Currently, I do not know a single serious marketer that wouldn’t use Kaito stack,” he told Cointelegraph, adding:

“Kaito has changed the way crypto marketing operates. Previously, it was mainly about views and impressions, however, Kaito introduced a new metric, Smart Followers. It allows one to measure how many respected or active crypto accounts interacted with or followed a specific account.”

Despite the platform’s innovation, some analysts have expressed concerns over its tokenomics, particularly regarding the allocation to insiders, which could create selling pressure after the airdrop.

Kaito tokenomics spark allocation, selling concerns

Similar events are often riddled with airdrop squatters, or professional airdrop hunters, who farm protocols with an incoming airdrop in hopes of financial gain. In 2023, the Arbitrum airdrop saw airdrop hunters consolidate $3.3 million worth of tokens.

Kazmierczak said Kaito’s airdrop structure is designed to prevent farming.

“Today’s airdrop allocation will be defined by the number of Yaps collected, which were very hard to bot, and Kaito genesis NFTs held at the snapshot.”

Still, onchain analysts have pointed out that a significant portion of the token supply is allocated to insiders. According to onchain investigator RunnerXBT, 43.3% of Kaito’s total supply is designated for insiders, including 35% for the team and 8.3% for early investors.

Cointelegraph has reached out to Kaito for comment but did not receive a reply by the time of publication.

Some analysts have also warned of a potential sell-off following the airdrop, particularly given the current market downturn.

Anndy Lian, an intergovernmental blockchain expert and author, suggested that Kaito’s token could follow a familiar pattern of hype-driven spikes followed by sharp declines:

“As for Kaito itself, I see a classic pattern: big hype, big spike, then a massive sell-off. Even if [the initial supply] is vested (which seems likely with allocations for liquidity and early backers), a lot of folks — especially those who farmed points just before with hyped airdrops: starts high, ends low.”

Crypto investor interest in airdrops saw an uptick on Jan. 15, after the total value of the Hyperliquid (HYPE) token airdrop soared to $7.5 billion, Cointelegraph reported.

 

Source: https://cointelegraph.com/news/kaito-ai-airdrop-tokenomics-concerns

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j