This is exactly right.

People are starting to look for cheaper model alternatives and realizing two things at once: open-source models are already very good, and the ability to train and serve them efficiently at scale can change the economics pretty meaningfully.

Tokens are still being subsidized, demand is ramping quickly, and the compute crunch is likely to persist. That will push companies toward using the right model for each task instead of defaulting to the most expensive one.

We’re still early, but I expect open-weight adoption to accelerate much faster than most people think.

@brian_armstrong Seeing this live through convos with builders in our private beta - we built a reasoning engine that helps cheaper models match or beat frontier model performance

Cost savings have been ~90% for teams switching over

If this is a focus would love to connect

@brian_armstrong You can run workloads ~80% cheaper on Surplus right now

https://www.surplusintelligence.ai/

@brian_armstrong Hey Brian - @openservai has already solved this problem through their reasoning layer. One line of code that makes current LLMs more efficient, cheaper, and reliable. Please take a few minutes to read this article! They're on your Basechain afterall!

@brian_armstrong Brian thank you for reading!

I would love to discuss AI and Crypto with you sometime. Happy to do a call, or I will come to you in person!

We have a few exciting things we are working on that I would love to run by you

@brian_armstrong Running models will get 99.9% cheeper...AND...demand will grow 1000X. The question is what happens sooner.

@brian_armstrong built Orca exactly for this - route different work to different agents / models

https://github.com/stablyai/orca

@brian_armstrong Thanks for the s/o @yenkel . @brian_armstrong, have been working on routing for 2 years, working with a bunch of F100s on routing for coding agents. We should talk! http://notdiamond.ai

You've got the demand side dead right.

One thing missing. Swapping in DeepSeek kills the token line, but the token line was never the scary part.

Provenance, compliance, the maintenance tail. That's the bill that spooked them, and the cheaper model doesn't touch it.

Wrote the long version of this a while back: https://open.substack.com/pub/sreekanti/p/the-long-tail-wags-the-enterprise?r=5pyj&utm_campaign=post-expanded-share&utm_medium=web

@brian_armstrong Agreed. On-chain data shows GPUcompute tokens like $RENDER and $GPU have seen 340% active wallet growth since AI mania. Compute scarcity = next big crypto infra play.

@brian_armstrong TokenMaxxing needs to evolve to Token Efficiency Optimization. Working on an open source product that achieves that with 4 well researched techniques: http://TokenJam.dev

@brian_armstrong > At Coinbase we're working hard on routing prompts to cheaper models where appropriate

you should chat with @tomas_hk

@brian_armstrong @pmarca “80% of workloads will be running on 99% cheaper models” this paired with latest CPU/GPU running local models is likely the answer. The average consumer/user won’t ever need anything more than GPT4.0 which will eventually be able to run on consumer hardware and do the job.

@brian_armstrong I said all of that very early on, you’re on the money here :)

https://ahmadosman.com/blog/serving-ai-from-the-basement-part-i/

@brian_armstrong What are you using for your cheaper model stack

i think this consolidation happens as a capability generation ages.

IMO the last capability generation started with sonnet 3.5 and is likely to end soon. will you actually want coinbase eng prompts going to GLM 5.1 if next gen is significantly better? (like GPT 4 to sonnet 3.5 better, not opus 4 to 4.1)

I suspect we’ll again be back to “OSS super far behind, not using frontier models is a competitive disadvantage” rather soon

@brian_armstrong A lot of people said this for the last 2 years every year and it hasn't been true so far.

@brian_armstrong @grok what is your best guess at the % likelihood that @brian_armstrong's guess is accurate.

@brian_armstrong Until you sort out $WLUNA anything you have to say means fuck all

@DamirWallener @brian_armstrong This is misunderstanding evolution and its "goals" vs human desires. Evolution is blind, directed by the environment towards fitness, reproduction. Life without any intelligence is abundant. Humans can contravene evolution (e.g. contraception) and have separate desires, demand...