One way to look at NFTs is that they are valuable because they allow digital property to reflect features we associate with property in the physical world. 

Think about owning a house. When you buy the house, you get a deed, which provides provenance via a chain of title. As the owner, you unilaterally possess the property and have the right to exclude others from using it. And if you improve the house, those improvements run with the property. Normal digital assets do not have these features, but NFTs can embody them.

NFTs have so far only reached product-market fit with art, which generally only utilizes the first two features. Take Asymmetrical Liberation, a piece from Botto. It certainly utilizes provenance to prove it was the first piece generated in Botto’s Genesis Period, and its holder has unilateral control over it. But there’s no way its holder can improve the art (nor would that make sense). The closest NFTs have leaned into this improvement feature is probably with video game NFTs, like when a player’s action in the game levels up a character. This feature is far too underexplored with NFTs.

I think one really interesting use case for NFTs that can impart all three of these features of property in the physical world is agents. The key insight is that agents have “memories” that allow them to record their experiences performing tasks for their principals. These experiences are unique, which makes them non-fungible. An NFT could represent an agent, and holding this NFT could provide exclusive read/write access to an associated memory slot in a trustless memory layer (functioning effectively as a “license” to these memories). This memory layer is exactly what companies like Plastic Labs are working on. 

Agents as NFTs would embody the three features of property in the physical world:

• Possession. The holder of the NFT will have the exclusive right to access the agent’s memories. 

• Improvements. The agent’s memory will update every time the NFT holder uses the agent, gaining holder-specific experience. The agent will also remember the refinements of the holder.

• Provenance. Because the agent can only be used by its NFT holder, a record of past holders will indicate its experience, functioning like a “resume.”

Leaning into these features of property in the physical world will allow for a highly specialized and differentiated agent that isn’t possible today. For example, imagine J. R. R. Tolkien held a certain NFT agent and used it while writing The Hobbit. Let’s say you want to write your own fantasy novel and are seeking an agent to help you. The fact that this agent was provably owned by Tolkien, and only Tolkien, indicates it has experiences that will be helpful for drafting a fantasy novel. If you acquire it, the agent would have added value because only you will be able to access it; the agent is a differentiator for you. 

While the majority of agents will probably make more sense as collective agents offered to the public via an API like any SaaS product, agents as NFTs enable something more akin to a racehorse. Racehorses are more valuable when they provably come from certain trainers, their training stays with the horse from owner to owner, and they can only be possessed by one rider at a time. 

Agents as NFTs unlocks a net-new design space in software I’m excited to see play out.  

Thank you to the Plastic Labs team, pepe, and Jiggy for their thoughtful feedback on this article.

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