The Synternet DeFi Ecosystem: Gearing Up for the DeFAI Revolution

Synternet

Feb 06, 2025

9 min read

The Synternet DeFi Ecosystem: Gearing Up for the DeFAI Revolution

For those building, developing, and using applications in the decentralized finance (DeFi) space, access to reliable, real-time blockchain data has become an absolute essential. Historically, however, many DeFi applications have relied heavily on blockchain data access provided by application programming interfaces (APIs) controlled by centralized entities that serve as gatekeepers to blockchain information. 

Synternet’s Protocol was designed to address these challenges as a trustless, permissionless protocol for empowering efficient cross-chain asset management, offering a decentralized and scalable way to access, retrieve, and interact with real-time blockchain data across multiple chains. 

Now, as 2025 dawns in earnest, developments in the burgeoning arena of artificial intelligence are opening up new decentralized finance opportunities. With its underlying data infrastructure already firmly in place, the Synternet Protocol is moving to position itself right at the intersection of the twin AI and DeFi revolutions and maximize on the intriguing potential this intersection presents. 

Let’s take a look at how.

Synternet’s Core Ecosystem Infrastructure

At its foundation, Synternet operates through an innovative publish-subscribe model that enables direct, peer-to-peer data streaming between blockchain networks. Built on the Cosmos SDK and leveraging the Inter-Blockchain Communication (IBC) protocol, Synternet creates a robust infrastructure for cross-chain data access and analysis.

The Synternet ecosystem has, historically, operated through four key participants:

Publishers Data providers who stream information to the Broker network. Publishers compete on price, data quality, and efficiency, creating an open market that drives down costs while maintaining high standards. There are no limits to what subjects publishers can offer, fostering innovation and comprehensive data coverage.

Subscribers Value drivers who pay for data delivery through the network. They establish on-chain agreements with Publishers through Synternet's developer portal, setting service fees and data access terms.

Brokers Network operators who relay data between Publishers and Subscribers. They stake SYNT tokens and receive fixed protocol fees for their services, ensuring consistent and reliable data delivery regardless of publisher pricing.

Observers Network validators who verify the proofs submitted by Brokers. They monitor data delivery, authenticate Proofs of Delivery, and ensure the accuracy of off-chain accounting before submission to the App Chain.

Synternet Architecture Overview
Image source: High level overview of the protocol | Synternet | Docs

The Rise of DeFAI

DeFAI - the convergence of decentralized finance (DeFi) and artificial intelligence (AI) via AI “Agents” holds the promise of upending many of decentralized finance’s current practices. In a DeFAI-enabled world, autonomous agents will soon be unleashed that could effectively manage digital assets and execute complex financial strategies. This development, once realized, could enable real-time monitoring, risk assessment, and automated decision-making at machine speed. As AI technology advances, these agents will become capable of handling increasingly sophisticated operations like treasury management, buying and selling assets, maximizing on arbitrage opportunities, vulnerability detection, cross-chain asset tracking, and more.

The Synternet team, it appears, believes strongly that AI's entry into the DeFi space represents a significant opportunity that will fundamentally transform how users will interact with decentralized finance systems moving forward. 

“According to Pantera Capital, on-chain asset value will exceed $1 Quadrillion, with 80% of that value managed by AI in some form. The gamified and meme quality of today's agents are rapidly changing into agents with real utility and purpose," explains Synternet CEO Daniel Haudenschild. "Soon Agent Aggregators will manage hyper specialized worker agents and the human interface will no longer be with an individual agent. In this world, which begins today, the ability to parse mountains of information and extract meaning instantaneously is paramount. That is what Synternet does. The largest decentralized pool of AI inferences and signals in the world."

This vision points to a future where specialized AI agents work in concert, processing vast amounts of blockchain data to execute user intentions. Rather than requiring step-by-step instructions, users will simply specify their desired outcomes, leaving the complex operations to intelligent agents operating on verified on-chain data.

Firing Up The Refinery: Introducing Synternet’s AI Agents Dock

Built atop this robust data availability infrastructure, Synternet’s AI Agents Dock represents a concerted, deliberate effort to pave the way for the next evolution of the DeFi user interface. To hear Synternet Co-Founder Jonas Sim describe it (as he did in a recent thread on X), enabling and empowering such agents is much more than just a “nice to have” feature, it’s a fundamental aspect of Synteret’s Protocol's true value proposition in the DeFi economy of the future.

“AI agents need high-quality data to make decisions. But raw blockchain data without structure is just noise. How does data become AI-ready? Where does Synternet contribute? And what the heck are AI inferences? 

Blockchain data is like crude oil. Raw, unstructured, and of little use on its own. To power AI, it needs to be refined into something actually valuable. To understand how data becomes AI ready, we have to learn how it gets there first. Publishers collect raw on-chain data which is executed and written on the blockchain. This is raw data in the form of transactions (from, to, value), smart contract calls (DEX trades, staking), block information (timestamp, miner, gas fees), and more. While we can't imagine the modern world without crude oil as it has many uses such as fuel, plastic and other petroleum products; crude oil on its own is useless and doesn’t serve a function. The same logic applies to raw and unprocessed data. Once you have raw data, you need to preprocess it before you can feed it to AI models. This can be converting wallet transaction history into time-series data, filtering smart contract calls only by $SYNT swaps, or removing spam transactions. 

This is the part where crude oil (raw data) gets refined into gasoline (preprocessed data). At this stage, the potential of what you have becomes obvious. You can power an engine with gasoline, or you can compute data to get insights & results. After preprocessing, the structured data is fed into AI models for various uses:

• Predictive analysis (liquidity risk, price movement)

• Anomaly detection (price manipulation, wash trading)

• Risk analysis (token reputation, sentiment).

This is exactly where AI inferences happen. The AI model processes blockchain data and makes a prediction, decision, or conclusion which is called an inference. We're actively burning gasoline (data) and turning it into torque (inferences). Once inferences are made, the AI model can provide actionable insights or make decisions. We're burning gasoline (processed data) to create torque (make inferences) which is used to move the car (create actionable insights).

But at which step is Synternet contributing to help AI agents make actionable insights? 

Answer: every step along the way.

Data collection: Synternet publishers gather on-chain and off-chain data and publish it to the Data Layer.

Preprocessing data: AI agents and modules on Synternet create AI-ready data for AI model training or real-time insights.

AI model processing: Inference data can be fed back into Synternet's Inference Pool which can be used by AI agents to make actionable insights.

Instead of going through the complex and resource-heavy compute tasks to create inferences, you could simply tap into a pool. From AI agents and protocols to researchers and analysts; all could simply pay for AI inference data. Even better, they could use AI inference data from Synternet's pool to compute it and create new, more valuable AI ready-data and republish it at a premium. An automated flywheel of AI agents acting as data publishers, processors and consumers in Synternet's ecosystem, all while contributing to the Data Layer and partaking in Synternet's data economy.”

Synternet’s AI Agents Dock enables autonomous agents to:

  • Process real-time Web3 data and market sentiment
  • Monitor cross-chain assets and validate collateral
  • Provide automated risk management with decentralized circuit breakers
  • Manage DAO treasuries with proactive alerts

The AI Agent: The New Synternet Ecosystem Participant

To showcase the capabilities of the Synternet Protocol, Synternet has launched its own flagship AI agent - Syntoshi. This agent will demonstrate the platform's ability to monitor wrapped assets across chains, validate collateral adequacy, and assess ecosystem security. Access to full agent’s functionality will require SYNT tokens, establishing a model for future agent integrations on the platform.

It’s a safe bet, however, that Synternet’s flagship AI agent will soon become just the first among many. AI agents can (and should) be expected to become massively influential ecosystem participants in and of themselves. Unlike traditional participants who fulfill single roles, however, these AI agents operate as processors of raw blockchain data from Synternet's Protocol, transforming it into valuable inferences that power the DeFAI economy.

The inferences these agents will generate from the data they refine can be accessed by any DeFi application or ecosystem participant. AI agents can also serve as automated circuit breakers, monitoring smart contract vulnerabilities and blockchain security in real-time. This continuous process of data refinement and inference generation creates an automated flywheel that enhances the entire ecosystem's utility.

With automated intelligence working alongside human participants, creating a more efficient, responsive, and valuable data ecosystem isn’t just a likely outcome, it’s inevitable. Synternet's Syntoshi AI agent and those that will follow will demonstrate this multi-functional role, showcasing how AI participants can leverage the Synternet ecosystem's infrastructure to deliver sophisticated market analysis and risk management to the DeFi world.

Ecosystem Integrations

Synternet's growing ecosystem demonstrates its versatility and real-world impact through several key integrations:

Google Cloud Web3 Portal 

Google Cloud Web3 Portal 

Google Cloud's integration brings Synternet's data streams to enterprise users, providing access to Bitcoin, dYdX, Injective, Osmosis, Arbitrum, and Ethereum data through familiar cloud infrastructure. This partnership enables developers to build sophisticated applications with enterprise-grade reliability while maintaining the benefits of decentralization.

Injective Partnership 

Injective

Through Synternet’s Injective integration, professional market makers gain access to critical real-time data streams, including mempool and proposed-block information. This partnership enables sophisticated trading strategies and improved market efficiency, providing traders with the low-latency data access needed for competitive advantage in DeFi markets.

KYVE Collaboration 

KYVE

KYVE's partnership with Synternet bridges the crucial gap between historical and real-time data access. This comprehensive solution enables detailed blockchain analytics by combining current data streams with historical records, providing the complete dataset needed for thorough market analysis and strategy development.

Anyone and peaq Integration 

Anyone and peaq

Synternet’s integration with Anyone and the peaqosystem showcases Synternet's capabilities in the DePIN space. This collaboration enables privacy-enhanced data relay and supports the development of secure, anonymous hardware communication networks, demonstrating how real-time blockchain data can enhance privacy and security in decentralized infrastructure.

Synternet and its growing ecosystem have made great strides in their quest to build out one of blockchain’s most robust protocols for fast and permissionless data. But, as they so often do, a disruptive new force has now entered the fray - one which holds the potential to rock the DeFi/user interface to its core. That force: artificial intelligence.  

Network Participation Through Staking

The Synternet ecosystem is secured through a robust staking mechanism that allows SYNT token holders to participate in network validation and governance. staking provides an attractive way for token holders to contribute to network security while earning rewards. The process operates on a 14-day lock-up period, with rewards distributed every block (approximately every 6 seconds).

Synternet staking participants play a crucial role in network decentralization and security by delegating their tokens to validators who process transactions and propose new blocks. This proof-of-stake system not only ensures network security but also gives stakeholders a voice in governance decisions. The system includes protective measures such as slashing penalties for validator downtime or double-signing, ensuring the network's integrity.

Final Thoughts

As Agent Aggregators emerge to coordinate specialized worker agents, Synternet's infrastructure becomes increasingly crucial for processing and contextualizing the massive data streams required for effective automated asset management. Synternet's ability to transform raw blockchain data into actionable insights (in the form of inferences), combined with its enterprise-grade integrations and robust security measures, positions it as an influential platform in the future of DeFAI and decentralized finance.

This future is rapidly approaching. Synternet's flagship AI agent launch marks the beginning of a new era, one where intelligent agents provide actionable inferences and make decisions based on verified on-chain data. With the community playing a key role in shaping its development, Syntoshi will demonstrate how Synternet's infrastructure can power the next generation of DeFAI (and DeFi) applications.

By providing the foundation for both raw data access and sophisticated AI inferences, Synternet is not just participating in the evolution of decentralized finance – it's enabling a future where intelligent agents seamlessly manage digital assets, guided by reliable, real-time blockchain data. As the DeFAI revolution unfolds, Synternet and its growing ecosystem appear poised to play a pivotal role.


DISCLAIMER: This is not financial advice. Staking and cryptocurrency investment involve a certain degree of risk, and there is always the possibility of loss, including the loss of all staked digital assets. Additionally, delegators are at risk of slashing in case of security or liveness faults on some PoS protocols. We advise you to DYOR before choosing a validator.

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