Understanding Pundi AI: A Comprehensive Overview

Key Insights

• Pundi AI aims to solve issues in AI data sourcing and tagging by creating a decentralized, high-quality data marketplace with fair rewards for contributors.
• The Pundi AI Data platform compensates users for data tagging, promoting decentralized participation in AI data management.
• Pundi Labs is merging Function X's f(x) Core and Pundi X Chain into Pundi AIFX to enhance scalability, interoperability, and EVM compatibility. Pundi AI plans to rebrand the $FX token to $PUNDIAI.
• Pundi AI will introduce the Pundi Fun Launchpad for new AI agents to launch their tokens. A Pundi AI market-making (MM) agent will handle liquidity by buying AI agent tokens based on the open market.
• Collaborations with Futureverse, Nubila, and Hugging Face leverage cross-industry synergies for AI data solutions and metaverse integration.

Background

Data quality is a considerable challenge when moving AI projects into production. Data teams often need help identifying relevant data and accessing high-quality data that can serve as the foundation for training effective machine learning models.

In a recent survey of over 1,500 global AI decision-makers, the early data steps in the AI life cycle, including sourcing, preparing, standardizing, and analyzing, were classified as more challenging than model configurations. For AI developers and companies, investing in diverse, high-quality datasets is essential for the success of putting any AI initiative into production.

High-quality data can be labeled or tagged so that AI systems can accurately recognize patterns and make informed decisions. However, data labeling presents significant challenges, primarily due to its manual nature. Despite advances in automation, large-scale human-labeled data is still necessary because current AI tools struggle to tag data accurately and comprehensively. Reinforcement Learning from Human Feedback (RLHF) is crucial for model training due to our understanding of context, nuance, emotional intelligence, and cultural awareness—elements AI has yet to master. This means the manual review of human-labeled data is irreplaceable for the foreseeable future.

Another challenge is the centralized nature of data tagging. Current systems often suffer from inadequate rewards for contributors, which leads to suboptimal data quality. Poor inputs inevitably result in poor outputs, creating a cycle that hinders the development of robust AI models. Without proper incentives, data contributors may lack the motivation to provide high-quality, accurate tags, further exacerbating this issue.

Pundi AI aims to address these challenges by creating a high-quality, decentralized, transparent data marketplace that rewards its contributors fairly. By leveraging blockchain, Pundi AI is working to redefine how data is sourced and tagged, ensuring contributors are appropriately rewarded and that the data available for AI training is of the highest possible quality.

Introduction

Zac Cheah and Danny Lim co-founded Pundi X in 2017 to make cryptocurrency accessible to everyone by providing blockchain-powered devices and applications for retail transactions. The Pundi X ecosystem, which was built on the Pundi X Chain, consists of the following products:

• PundiX Pay - PundiX Pay is a QR code-based crypto payment solution that enables merchants to accept digital currencies without needing traditional point-of-sale (POS) systems. Customers can pay using BTC, ETH, BNB, and USDT directly from their crypto wallets.
• Pundi XPOS (Point-of-Sale) Device - Pundi XPOS is a blockchain-based POS device that allows merchants to accept cryptocurrency payments seamlessly. It supports several digital assets and integrates with popular wallets like MetaMask, Trust Wallet, and XWallet for QR codes or NFC payments. Additionally, Pundi X offers p(X) cards, which are physical cards that function similarly to hardware wallets.
• $PUNDIX Token: $PUNDIX is the native utility token of the Pundi X ecosystem used for transaction fees, staking, and governance. Developers must use PUNDIX tokens to publish applications on the Pundi XPOS app store. Advertisers, developers, and ad networks can place advertisements through the Pundi X advertising platform using PUNDIX tokens, facilitating targeted marketing within the ecosystem.
• Function X: Function X (f(x) Core) is an interconnected blockchain system designed by Pundi X to power its decentralized applications (dApps) and services. It focuses on scalability, security, and efficiency. FX is Function X’s token for staking, transaction fees, and governance.

Transition from Dual Chains to a Unified Platform

Previously, Pundi operated two separate blockchain networks:

• f(x) Core: A blockchain built on the Cosmos SDK and designed to support decentralized applications (dApps) and provide a scalable infrastructure. Its architecture emphasizes interoperability, leveraging the Inter-Blockchain Communication (IBC) protocol and Cosmos’s modular structure for enhanced functionality. More details about its functionality and role in the ecosystem can be found here.
• Pundi X Chain: Based on the Cosmos SDK, this f(x) Core subnet focused on facilitating cryptocurrency payments and transactions within the Pundi ecosystem. However, it lacked compatibility with Ethereum Virtual Machine (EVM), which limited its usability and potential integrations. Consequently, the Pundi X Chain is being deprecated, and all its assets are being moved to AIFX.

In August 2024, a governance proposal was passed to merge Pundi X and the f(x) Core into a single entity, rebranded as Pundi AIFX. Upon approval, the Pundi X team began the merger process, including the retirement of the Pundi X Chain and the migration of assets to Pundi AIFX. The f(x) Core validators will continue operation under the rebranded AIFX name.

Pundi AI Ecosystem

Pundi AI’s ecosystem consists of three layers:

1. Application Layer
2. Major Layer-1 (L1s) and Layer-2’s (L2s)
3. Omnichain Data Layer (Pundi AIFX)

The primary objective of Pundi AIFX is to be a data processing layer. Value accrues at the base layer through the verification of tagged data. Tagged data can then be transferred through major networks to applications, which leverage the data for superior model training and performance. Pundi AIFX's secondary goal is to prevent large corporations from monopolizing AI data. To this end, it has opened several data sanitization tasks to the public, which could generate additional income for users.

Pundi AIFX derives value through three separate product offerings built on the network:

Pundi AI Data

The Pundi AI Data platform introduces a "Tag to Earn" incentive mechanism, compensating users for tagging data. The supply side (datasets) is internally curated through AI agents like Truth Terminal and externally sourced through paid data provider partnerships. Users meet the demand side (data tagging and reviewing) by completing paid text and image tagging tasks. Users connect to Pundi AI with their wallets and can select from various data labeling tasks. Alternatively, users can review labeled data for accuracy. Either type of task pays out a preset amount of USDT rewards paid by dataset providers upon verification by the AIFX layer.

Taggers and reviewers can rate task publishers, creating a transparent marketplace where contributors can opt to work with fair publishers, and publishers can choose top-performing contributors. Tasks undergo multiple iterations of data labeling and are reviewed or tagged by several individuals or AI agents during the review process. The platform stores tagged data on the blockchain and will eventually sell it on a marketplace for AI companies and developers to purchase.

The platform is designed to compete with high-quality data providers, such as Scale AI, that provide organizations with tagged data to train AI applications and models. The industry has become controversial due to unfair work conditions and unrealistic quotas. Pundi AI will offer a decentralized alternative to ensure data providers, taggers, and reviewers are fairly compensated through a tokenized reward system.

Pundi AI Data addresses the growing challenge of limited fresh data for AI training. Synthetic data often lacks the complexity and nuance of real-world data, leading to poor generalization, bias, and potential model degradation. By democratizing access and labeling to high-quality, real-world data, Pundi AI aims to ensure AI models remain reliable, unbiased, and effective in real-world scenarios.

Pundi Fun Launchpad and AI Market Maker Agent

In January, the Pundi team announced they are building the Pundi Fun AI Agent Launcher, which will allow projects to train and launch AI agents using trained datasets on Pundi AI Data. Pundi Fun will enable developers to launch a token through a bonding curve mechanism, which ensures fair token distribution, reduces launch price volatility, and maintains liquidity by dynamically adjusting token prices based on supply and demand.

A Pundi AI market-making (MM) agent will handle liquidity by buying AI agent tokens based on the open market. Projects bribe $vePUNDIAI holders using their agent tokens to secure enough votes to receive funding from the AI MM Agent. The AI MM Agent handles the onchain market-making process once the vote passes; the community conducts voting weekly.

AI Agent tokens minted using other launchpads can still participate in the Pundi AI MM Agent platform voting by bribing $vePUNDIAI holders. Fees from the Pundi AI MM Agent are redistributed to $vePUNDIAI holders, creating an incentive flywheel for the vePUNDIAI token.

Pundi AI Data Marketplace

The Pundi AI Data Marketplace will enable users to buy and sell data assets. The platform aims to connect dataset providers, labelers, and sellers. The data marketplace will introduce new clients on the demand side who can purchase labeled data from Pundi AI or other dataset providers. Each data piece is encrypted, verified, and stored as an NFT, guaranteeing its provenance and integrity. Pundi AI Data Marketplace is scheduled to launch in Q1 2025.

PURSE+

PURSE+ SocialAI is a browser plugin that allows users to analyze, tag, and categorize social data on X (Twitter). Users earn rewards through $PURSE tokens, which can be staked to amplify earnings. PURSE+ is part of the broader Pundi AIFX goal of democratizing data labeling.

$FX Token (rebranding as $PUNDIAI)

The FX token, currently rebranding to $PUNDIAI, has a delegated supply of 1.9 billion tokens. The $FX token is fully diluted, although approximately 60% of the token is locked in the validator node and community pool. The supply will be reduced by a factor of 100 in the conversion to $PUNDIAI, i.e., 100 $FX tokens will be converted to 1 $PUNDIAI token. This means no new tokens will be minted in the rebranding.

The rebranded $PUNDIAI serves as a bridge between contributors and users of AI data. Payments will be directed into the Pundi AI salary pool, and rewards are periodically distributed to contributors. Contributor compensation is directly correlated to data sales and service usage. The salary pool also serves as a staking yield pool for $PUNDIAI. AI data contributors receive earnings after data is reviewed and users can verify data quality.

Roadmap & Partnerships

The Pundi AI roadmap consists of three phases. Phase 1 occurred in Q3 2024, and the protocol is currently in Phase 2.

Phase 1 - Inception:

• Website upgrade
• Publication of the PUNDI AI White Paper
• Data annotation browser extension (alpha release)
• Pundi AIFX omni layer merges with the f(x) Core.
• Block explorer upgrade
• Governance voting goes live

Phase 2 - Perception:

• AIFX data layer to connect to Cosmos.
• Pundi AI Data tagging platform launches whitelisted beta
• New partnerships with AI projects
• Pundi AI Marketplace launches alpha
• Introduction of the Tag-to-Earn model
• Token swap (subject to community and exchange support)

Phase 3 - Intersection:

• AI Marketplace and referral program launch
• Data labeling tool launch browser and mobile app
• Continued partnerships with AI projects
• AI Marketplace launches salary pool and staking pool
• Pundi AIFX data layer connects to more L1/L2 networks
• "Tag to Earn" acceleration program

Pundi AI has also spent Q3 and Q4 partnering with several different companies and crypto protocols, including:

• Futureverse: Pundi X and Futureverse have partnered to integrate AI and blockchain, advance metaverse payments, and leverage AI data from their ecosystems. Futureverse users will have an opportunity to earn rewards by labeling data through Pundi AI. Pundi X will integrate The Root Network (ROOT) into its payment services. They also plan to enhance metaverse payments via Readyverse and connect Futureverse users to Pundi X’s SocialFi platform, Purse+.
• Nubila: Pundi AI has partnered with Nubila Network to integrate real-time ESG data from Nubila's global weather stations into the Pundi AI Data platform. Nuvila is a DePIN protocol that leverages AI and DePIN to collect, analyze, and assess economic data.
• Hugging Face: Pundi AI will partner with Hugging Face to leverage its community of developers and data contributors. These contributors can participate in a reward-sharing program by tagging and reviewing data.

Closing Summary

The Pundi AI ecosystem integrates blockchain technology and AI data solutions to tackle challenges in data tagging, accessibility, and decentralization. Leveraging the Pundi AIFX omnichain infrastructure, it offers tools like Pundi AI Data, PURSE+, and the upcoming Data Marketplace to ensure high-quality, transparent solutions for contributors and users. The rebranding of Function X to Pundi AIFX enhances scalability, interoperability, and EVM compatibility, enabling decentralized applications and cross-chain integration.

With a phased roadmap and partnerships with organizations such as Futureverse and Hugging Face, Pundi AI is set to drive long-term growth through initiatives like the AI marketplace and data tagging tools. The transition from $FX to $PUNDIAI further aligns tokenomics to incentivize contributions and utility, positioning Pundi AI as a key player in decentralized AI data management.