Following the same pattern, what will be the effect of SingularityNET ecosystems merger?

Original author: Frank, PANews

On October 15, SingularityDAO, Cogito Finance and SelfKey announced plans to merge to form a new project, Singularity Finance (SFI), which focuses on tokenization of the artificial intelligence (AI) economy. According to reports, the new entity will provide a Layer 2 network for tokenizing assets (such as GPUs) and providing AI-driven financial tools.

When this news came out, many people felt confused. They were under the impression that SingularityNET had completed the merger in June this year, so why did they propose the merger again? In fact, SingularityNET completed similar mergers with AI projects such as Fetch.ai and Ocean Protocol in June. I wonder if SingularityNET has tasted the sweetness of the merger and this time let its ecological project SingularityDAO also follow suit.

SingularityNET, SingularityDAO, Singularity, I can’t tell them apart

Perhaps the word Singularity is too closely related to technology, which leads to many projects using this word as their names. This also leads to the fact that in the crypto field, there are three projects, SingularityNET, SingularityDAO, and Singularity, which are difficult to distinguish.

In fact, SingularityNET is inextricably linked to SingularityDAO, while Singularity is an instant payment solution for Web3 games from India and has nothing to do with SingularityNET and SingularityDAO.

In short, SingularityNET is a decentralized artificial intelligence platform and market that allows developers and companies to share, create, sell or purchase AI services. SingularityDAO is a key project in the SingularityNET ecosystem, focusing on the combination of decentralized finance (DeFi) and AI technology.

SingularityNET was founded in 2017 and completed its initial token offering of $36 million that year. Subsequently, the project token AGIX was launched in 2018, and its current market value is approximately $750 million.

On March 27, 2024, Fetch.ai, SingularityNET and Ocean Protocol announced that they had reached a final agreement to merge their tokens to create the largest open source independent entity in the field of artificial intelligence research and development: the Artificial Superintelligence Alliance. The alliance has been established. In July, the original three projects started the migration of tokens FET, OCEAN, and AGIX to the new token ASI.

On October 15, SingularityDAO, a project within the SingularityNET ecosystem, announced a merger with Cogito Finance and SelfKey to form an AI-centric Layer 2 network. The new merged project was named Singularity Finance.

Can the merger achieve 1+ 1+ 1>3?

Projects that have been merged from the main network into the ecosystem have also begun to merge, which makes people wonder whether the merged projects can really bring about the effect of 1+1+1>3. Here, we focus on the performance of Fetch.ai, SingularityNET and Ocean Protocol, which have already merged.

First, in terms of token performance, before the merger, the market value of SingularityNETs token AGIX was approximately $1.52 billion, and the market value of Fetch.ais token FET was approximately $2.97 billion. The market value of Ocean Protocols token OCEAN was approximately $673 million. As of March 27, before the merger, the total market value of the three projects was approximately $5.163 billion. After the merger was announced, the market value of the new token ASI (currently still code-named FET) once reached $6.3 billion. From the perspective of token market performance, it has indeed achieved the effect of 1+ 1+ 1>3.

On September 11, 2024, the ASI Alliance announced that it would include the global distributed computing network CUDOS as a member. As part of the integration, the CUDOS token (CUDOS) will be merged into the ASI Alliance token (FET). On September 27, CUDOS officially started the token migration.

However, judging from the overall actions of ASI, the current merger is still in the token merger stage, and the four projects seem to be still operating independently. According to the official website, after the token merger, the ASI network will be deployed and upgraded, but the progress is still pending. As of October 16, the market value of ASI tokens was approximately US$3.5 billion, which has dropped by nearly half since the merger. In the official document, the merger of tokens is a prerequisite for the three ecosystems to achieve greater interoperability.

In addition, it seems that the merger did not bring real prosperity to these projects. Take Ocean Protocol as an example. According to tokenterminal data, as of October 15, the network had only 109 daily active users. From the chart, the projects daily active users only exceeded 7,000 in June, and then it has been declining. Due to the lack of data statistics, the specific network activity of the other two projects cannot be known. Under SingularityNETs social media, many user comments questioned the alliance because there is still no specific product, such as Create a product first, I dont know why I invested in this.

What will SingularityDAO create by following the same pattern?

Different from the grand narrative of the merger of SingularityNET and other three companies (creating a decentralized AI infrastructure), SingularityDAO, which previously focused on DeFi protocols, plans to create an AI-based EVM Layer 2 after merging with Cogito Finance and SelfKey to tokenize real-world assets (RWA) in the AI economy. According to the official plan, the integration will make SelfKeys existing token KEY become Singularity Finances new token SFI. SingularityDAOs SDAO and Cogitos CGV will be merged into SFI at a ratio of 1: 80.353 and 1: 10.89 respectively.

However, this merger did not seem to arouse much expectation in the market. The benchmark token KEY not only failed to rise rapidly after the news came out, but fell all the way. On October 16, it fell 5.48% in a single day.

Among the three projects involved in this merger, SingularityDAOs previous business was mainly focused on the DeFi field, SelfKey is a self-sovereign identity ecosystem based on blockchain, and Cogito Protocol is an RWA protocol based on artificial intelligence. From a narrative perspective, the merger of these three to create a Layer 2 based on an AI system focusing on the RWA track can be said to be a full stack of buffs that caters to the hot topics of the current mainstream narrative.

Looking back at past experience in the crypto space, mergers are relatively rare.

Looking at the two mergers of the SingularityNET system, the participating projects were basically established before 2022, and most of them were old projects from 2017 to 2018. With the development of the industry, the attention of most old projects has gradually decreased in this round of bull market, and financing has become more difficult. Creating a new project through mergers can not only integrate the strengths of each company, but also better cater to market preferences.

Therefore, the merger path is a novel way out for old projects with the same problems. However, whether the goal of the merger is to create a more meaningful product or just to achieve the effect of 1+1+1>3 in terms of token market value and narrative is still worth observing.