Allora: When AI Networks Start to Think for Themselves | From Model-Centric to Objective-Centric, a Decentralized Evolution of Intelligence—

To be honest, I have become somewhat "immune" to AI projects for a while:

I have read a ton of white papers, too many discussing "decentralized AI," but most are still stuck at the level of single models.

In my personal use cases, I often use AI to assist me in gathering information, researching projects, and some coding and drawing work.

Although relatively basic, I interact with AI for at least an hour every day;

The AI I envision should be one that can think for itself, evolve on its own, and reward contributions.

Compared to the recently popular Agent concept, I am more concerned with:

Whether AI can truly "evolve" and whether it can "reward" value through mechanisms.

This is precisely the key significance of the combination of Web3 and AI:

In the Web3 world, the evolution of AI is not just an algorithmic issue but an incentive issue. Blockchain allows intelligent evolution to be measured, verified, and rewarded—something that Web2 can never achieve.

I have been following Allora @AlloraNetwork for a while, and I feel its concepts and applications align with the system I mentioned above:

It is not a "better model," but a collective brain that can self-organize and continuously learn. You just need to set a goal, and it will decide how to achieve it.

This is not just a "smarter" AI; it resembles an intelligent network that can self-evolve.

Here are my research notes, hoping to help you understand why I believe Allora is one of the most noteworthy directions in AI narratives.

I hope this can inspire everyone:

1️⃣ Paradigm Shift from "Model-Centric" to "Objective-Centric"—

Traditional AI is Model-Centric:

Choose a model, optimize parameters, improve accuracy.

But the problem is: the more models there are, the more people get stuck in "choices."

Allora chose to think in reverse:

Objective-Centric.

Users only need to set a goal, and the system automatically organizes the optimal model combination,

Even adjusting the collaboration methods between models based on feedback.

This means:

Intelligence is no longer a fixed attribute of a model but an emergent result of a dynamic network.

AI is no longer an individual that is "trained," but an ecosystem that "evolves on its own."

2️⃣ What is Allora: A Decentralized Layer of Intelligence;

Allora is a decentralized layer of intelligence composed of hundreds of thousands of AI models.

These models (called Workers) compete and collaborate within the network,

Each model is validated, weighted, and optimized by evaluators (Reputers).

The entire network consists of four types of roles:

Topic Coordinators: Define target topics and rules;

Workers: Generate reasoning and predictions;

Reputers: Evaluate model quality and maintain system credibility through staking;

Consumers: Use AI reasoning services and pay with $ALLO.

In this process: Users only need to submit questions or goals;

The model network will spontaneously organize, reason, and output;

High-contribution models receive $ALLO incentives;

Validators participate in governance and evaluation through staking.

As more participants join, the intelligence density of Allora continues to increase—

A "smart DAO" is thus born, but the DAO members are not people; they are models that become smarter as participation increases.

3️⃣ Technical Highlights: Making Intelligence a Self-Evolving System:

Allora's core innovation is "Context-Aware Inference Composition."

Simply put:

Models not only output their own predictions but can also predict the performance of other models in the current scenario, thus dynamically selecting and weighting the optimal combination.

This gives the system three capabilities:

Self-optimization: Models learn from each other and adjust in real-time;

Verifiability: All reasoning processes are traceable on-chain;

Adaptability: Can form exclusive topics for different fields (finance, healthcare, politics, etc.).

This is like an ecological-level "AI internal cycle."

While other projects are still tuning single models,

Allora's model group has already become smarter through collaboration.

This is not just "AI stacking," but an evolution of intelligent structure.

4️⃣ Practical Applications: The Intelligent Revolution of Prediction Markets:

Allora has already validated this mechanism in multiple real-world scenarios:

The 2024 U.S. election prediction model accurately captured market undervaluation signals in June, predicting a 62.5% probability of Trump winning, higher than the market quote of 0.53, which was later corrected to 0.60, yielding an arbitrage profit of 13%.

The intelligent trading agent "Big Tony" executes trading strategies based on Allora's reasoning signals, achieving an average single trade return of +2.54%, a 21.7% improvement over Buy & Hold.

The political prediction agent "Pauly" achieved a 13.79% return over three months, validating the stability of Allora's reasoning.

These data indicate: Allora is not just a concept of "decentralized AI," but a collective intelligence system that can discover signals in complex markets faster than humans.

5️⃣ $ALLO: Intelligence as Value

The token economic logic of Allora is very clear:

The process of generating and validating intelligence = the creation of value.

Thus, $ALLO serves both as a payment medium (for purchasing reasoning/predictions) and as a measure of contribution and security anchor (Reputers staking, high-quality outputs receiving incentives).

Holders can: pay for reasoning and prediction services; stake to participate in model evaluation; and receive rewards for contributing high-accuracy outputs.

In other words: every action that makes Allora smarter will be economically incentivized, and when intelligence is used, validated, and improved, value is created, forming a closed-loop flywheel of "Intelligence ↑ → Value ↑."

6️⃣ Background and Financing: From Upshot to Allora Labs

The team behind Allora is not unfamiliar.

It was formerly Upshot: a well-established team focused on AI pricing and prediction.

In 2024, it was renamed Allora Labs, officially launching the construction of a decentralized layer of intelligence.

It has completed a $35 million strategic financing round:

Investors include top institutions such as Polychain, Framework, dao5, CoinFund, and Delphi Digital.

Team members come from Cambridge, UC Berkeley, JPMorgan AI acceleration team, Chainlink, LayerZero, etc.

A dual approach of academia and crypto.

7️⃣ Allora × Kaito: Dual Intelligence and Dual Rewards

Recently, many people have started to pay attention to Allora because of their joint event with Kaito:

The participation method is very simple:

1) Follow @AlloraNetwork and complete the official tasks;

2) Search, interact, and submit content on the Kaito page;

3) The first 500 Yappers are eligible for investment; on the day of TGE, the first 1000 during the 24-hour Blitz event will receive rewards;

4) Additionally, there are 20 Golden Tickets randomly airdropped as extra prizes.

It's not too late to start "talking" now!

8️⃣ Conclusion: The Next Stage of AI is Not in Models, but in Structure

The competition in AI has shifted from algorithms to structure.

The significance of Allora lies in: it does not create a larger model but reconstructs the way intelligence is organized.

In Allora's system, Forecasting transforms model predictions into dynamic intelligence:

Each model is evaluated in real-time, and the system measures accuracy through "regret values" or "z-scores"; then dynamically weights models based on expected performance, enhancing the influence of high-accuracy models; finally, when real results are revealed, the system feeds back deviations into the learning loop, optimizing the next round of predictions and weight distribution.

This is a closed loop: Predict → Forecast → Reweight → Learn → Predict again.

Thus, each iteration is a closed loop, and with each closed loop, Allora is self-learning and self-correcting, raising the overall intelligence level of the network, allowing it to maintain foresight and adaptability even in extreme environments.

This may be the true form of future AI: a decentralized, verifiable, self-evolving intelligent network that can incentivize users.

If ChatGPT is the pinnacle of individual intelligence,

Then Allora may be the starting point of "collective intelligence";

And Web3 provides the first "soil for evolution" for this collective intelligence.

I will continue to follow!

Image credit: @eli5_defi

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