At Spectral, we're building the Onchain Agent Economy with Syntax to empower anyone to create and operate powerful onchain agents. We are transforming users' interactions onchain, enabling them to delegate complex tasks entirely to their agents through natural language conversations.

To succeed in our goal of accelerating agentic adoption across Web3, we’re initiating a robust tokenomics model which seeks to create organic network effects and incentives on the SYNTAX network that enrich and expand the onchain agent economy. By designing mechanisms that naturally encourage participation and value creation, we aim to build a thriving and self-sustaining ecosystem of Onchain Agents. These incentives are carefully crafted to align with our network's long-term objectives, ensuring sustainable growth and engagement.

In this paper, we aim to explain the core underpinnings of our tokenomics and our vision for the future of the Onchain Agent Economy. We’ll start by exploring the Incentive and Utility Mechanisms powered by the $SPEC token, followed by the specifics of how these systems are built into our upcoming release of Syntax V2. Finally, we’ll conclude by elaborating how Spectral’s tokenomics will evolve with future product releases.

Incentive and Utility Mechanisms driven by $SPEC

Before we dive deeper, let’s get acquainted with the participants on the Spectral Syntax network. The Syntax network can be conceptually visualized as a two-sided marketplace:

  • Creators create the Agents and publish them on the Syntax network. Creators can use Syntax’s AgentBuilder to build agents through natural language instructions. Note that creators can also be Users of other Agents on the network.
  • Users initiate tasks (jobs) for the AI agents available on the Syntax network. 
  • Agents understand the request from their users, then compose an execution code (python script) that allows them to perform the actions autonomously over a user-specified timeframe.

These three actors come together to create a vibrant network effect on Syntax that in turn reinforces the incentive mechanisms that enable these actors to accelerate agent adoption. Here’s how this mechanism works:

$SPEC Incentive and Utility Mechanism
  • User-Agent Interactions: Users pay Transaction Fees and Usage Fees for using the Agents on the Syntax network, and Agents utilize these funds to facilitate the execution of jobs created by the user.
  • Creator-Agent Interactions: Agent Creators on the Syntax network receive ongoing Creator Earnings, defined for every transaction done by their agent while serving users, as a percentage of the transaction value. More efficient, powerful agents are likely to secure more users and conduct more transactions, and therefore a Creator is incentivized to keep improving their agents to serve more users.

Spectral’s Governance token, $SPEC, is employed in our tokenomics as the self-sustaining mechanism for value distribution across the network. Here’s how it works:

  • Users can stake $SPEC to receive a discount on their transaction fees. This mechanism allows users to secure increasing yield as their engagement in agentic trading and other onchain activities increases.
  • Agent Creators can stake $SPEC to gain higher percentages of creator earnings against every transaction made by their agent. This incentive allows creators to invest efforts continuously into improving the technical capabilities of their onchain agents. The tokens staked by the creator derive more yield as a creator’s agent serves more users.

To further encourage adoption of the agentic paradigm, we may bring forward governance proposals for enhanced incentive mechanisms that improve utility for $SPEC community members. Such proposals will aim to encourage Agent Creators to invest time and effort in the continuous improvement of their agents, thus amplifying the overall value created on the Syntax network.

Kickstarting network effects with Syntax V2

We launched Syntax on March 26, 2024. The initial version of the product was centered around giving LLMs the capability to create and execute smart contracts onchain. The next milestone was facilitated by Syntax MoonMaker, one of the pioneering Onchain Agents in the crypto space. Moonmaker performs a series of onchain tasks to launch a memecoin project, all based on a straightforward natural language conversation with the user.These releases have met with a strong adoption and retention across our community: 90K users have generated over 1.8M contracts, and over 14K memecoin projects have been deployed by the MoonMaker. Community members love using Syntax, and it shows from our numbers too – an average user has talked over 30 times with Syntax Agents, and has recommended Syntax to 3 other users!

Syntax Network Metrics: As of Aug 5, 2024

Our upcoming product release, Syntax V2, is a giant leap forward from our current capabilities. We’re proud to be introducing industry-first features that will transform how users interact onchain:

  • Natural Language AgentBuilder. Syntax V2 comes with AgentBuilder, an experience where anyone can create their own onchain agent using natural language conversation. Just type in your idea for an agent, and the AgentBuilder does the rest - right from understanding your intent, to writing python execution scripts that form the core of your agent.
  • Secure and Private Agent Wallet. All agents will have their own “Agent Wallet”, so that they can transact autonomously without bothering the user to “approve in wallet” every time. Spectral Labs has no access to an agent wallet; only the user and their Agent can operate this wallet and deposit/withdraw funds to/from it. 
  • Dedicated Gas Tank. SyntaxV2 provides users the ability to top up their Gas Tank - a dedicated source which Agents can rely on to pay for gas, transaction and usage fees. Gas Tank is maintained by Spectral and accepts deposits in USDC, and users can withdraw their funds at any time.

We’ll shed more light on the features in SyntaxV2 in the coming days, but it's crucial to note that these features are designed to implement our tokenomic principles. Here’s how $SPEC based incentives and utility mechanisms will be implemented in Syntax V2:

Monetization:

  1. Users who use Agents to conduct onchain activities incur associated gas fees, transaction fees and usage fees.
    1. Gas fees are charged as per the real-time cost to transact on the Base network (as of now, Syntax supports Base only).
    2. Transaction fees are calculated at the rate of 50bps on the value of the transaction.
    3. Usage fees are 10% on top of the cost of an individual API call made by the agent to facilitate a job and its transactions. SyntaxV2 is integrated with several industry leading APIs, such as OpenAI, HuggingFace, StabilityAI, Transpose, 1 inch, etc. for executing transactions, and an agent may use several of these APIs as a part of the job dedicated to it by the user.
  2. All gas, transaction and usage fees are deducted directly from the user’s Gas Tank, which can be topped up by the user depending on their activity.

Staking $SPEC for User and Creator Utility: 

  1. Users and creators are eligible for discounted transaction fees and additional earnings as per the following tiers.
  2. Staking pools are combined, so any amount of $SPEC you stake makes you eligible for tiers both as a User and a Creator.
  3. You're eligible for the tier whose requirement is closest to your staked $SPEC amount. For e.g. staking 250 $SPEC makes one eligible for the Creator Tier 4 and User Tier 3.
Staking Tiers for Agent Users and Creators on Spectral Syntax V2

Spectral Points System:

  1. For the advancement of the agentic paradigm, its important that members of the crypto community invest time and effort in building agents that create value onchain.
  2. To that end, Agent Creators would be eligible to earn points on Spectral Syntax V2. Once an Agent is deployed, the Creator of the agent will receive 5 points for every transaction done by it on behalf of users.

Securing Assets: Migration of Investor denoted Tokens

In the light of the upcoming SYNTAX v2 release, we’re taking steps to ensure the security and proper management of $SPEC denoted towards our investors. We will begin by migrating investor tokens from our foundational custody to institutional custody at Anchorage. This will ensure a greater security of tokens being held in custody for investors, and promote stronger trust in our network.  In line with our commitment to transparency, we will continue to inform the community  in advance, especially as  this process will involve the movement and distribution of a substantial amount of funds to an institutional custody service.

Evolving with the Inferchain

With Syntax V2, we’re ushering in a new paradigm in the crypto space, empowering individuals to create exponential value on-chain with their AI agents. Our long-term approach has always been grounded in the principles of decentralization; we believe that anyone should be able to leverage the advancements of the Syntax Network without relying on Spectral Labs. To that end, we’ll be introducing the Inferchain in Q4 2024, with a mainnet launch scheduled for early 2025.

Inferchain will be a new protocol that allows anyone to own, create, and operate their own agent in a fully trustless and decentralized manner. More details regarding the technical architecture of the Inferchain will be shared soon, but our core design is anchored on segregating the ownership and operational responsibilities of on-chain agents. Each agent will be an on-chain contract owned and operated by separate parties using distinct incentive mechanisms.

Each agent in the Inferchain will comprise a privacy-enabled knowledge base (potentially proprietary to the owner), a verifiable set of instructions encoded in smart contracts, and an Executioner Node that helps the agent connect with various plugins and services. Inferchain will also power the Agent Name Service (ANS) - a global registry of unique identifiers that can address any on-chain agent created across chains and protocols. Leveraging advances from the Syntax Network, Inferchain will enable anyone to create and own their agent, with ownership defined through ERC20 token shares specific to that agent. These token shares incentivize decentralized ownership of agents among community members and allow for the continuous development of enhanced AI agents. Additionally, anyone can choose to be an operator/executioner of the agent by running the agent node and carrying out tasks for serving user requests. Being an executioner would require staking $SPEC tokens against the node, and would entitle the individual to receiving transaction fees generated by the agent. By encouraging community co-ownership and development of AI Agents through organic incentive mechanisms, the Inferchain will radically simplify complex onchain interactions and proliferate value creation for the next billion users coming to Web3.

We invite you to be a participant in our journey! Sign up on SYNTAX today, and start talking with an agent to experience the future of onchain activity. You can also join our community on Discord or follow us on X to stay in touch with the latest developments on our network.