The Rise of AI Native Public Chains: In-depth Analysis of Five Major AI Layer 1 Projects

With the rapid development of artificial intelligence technology, traditional blockchain architectures have struggled to meet the high-performance computing and complex data processing needs of AI applications. As a result, a number of Layer 1 blockchain platforms optimized for AI have emerged, showcasing diverse characteristics in terms of technology architecture, application scenarios, and business models. This article provides an in-depth analysis of five leading AI Layer 1 projects: Bittensor, Vana, Kite AI, Nillion, and Sahara.

Bittensor: Decentralized AI Network Infrastructure

Bittensor, as an early explorer in the blockchain AI field, is dedicated to building an open decentralized artificial intelligence collaboration network. Its goal is to break down the centralized barriers in traditional AI research and development, allowing more participants to contribute and benefit together.

Bittensor's technical architecture adopts a dual-layer structural design:

• Root Network (Mainnet): Responsible for the coordination, verification, and issuance management of TAO tokens for the entire system, it is the hub of resource allocation in the entire network.
• Subnet Ecosystem: Each subnet is like an independent AI laboratory, developing specialized solutions for specific AI application scenarios and proving its value in market competition.

This design enables Bittensor to balance the overall stability of the network with the expertise in various fields, providing a flexible infrastructure for the development of decentralized AI.

Ecological Development Progress

• The number of subnets has expanded from the initial 32 to over 64, covering various AI application scenarios such as text generation, trading signals, and data annotation.
• The active user base has reached 140,000, doubling compared to the previous year.
• The total valuation of the subnet market exceeds 100 million USD, with a daily trading volume maintained at around 45 million USD.
• Institutional participation has significantly increased, with well-known funds incorporating TAO into their decentralized AI fund, adjusting its weight to 29.55%.

The recent dTAO (Dynamic TAO) system upgrade completed by Bittensor is a significant innovation in its economic model. The core of this upgrade lies in optimizing the distribution mechanism of the token TAO, shifting from a resource allocation method that relies on the subjective judgment of validators to a more market-oriented allocation mechanism, allowing resources to flow more precisely to those subnetworks that are truly competitive.

To address the issue of resource allocation, the dTAO upgrade introduces a dynamic resource allocation system based on market mechanisms. This system transforms each subnet into an independent economic unit, driving resource allocation through users' actual demands. Its core innovation is the subnet token (Alpha token) mechanism:

• Operating Principle: Users can obtain Alpha tokens issued by various subnetworks by staking TAO, which represent the users' support for specific subnetworks.
• Resource allocation logic: The market price of Alpha tokens becomes a signal for measuring the demand intensity of the subnet. Initially, the price of alpha tokens is the same, with only 1 TAO and 1 alpha token in each pool. As the liquidity of the two types of tokens in the subnet increases, the price of alpha tokens will also change accordingly. The emission of TAO is proportionally distributed based on the price of subnet tokens among all tokens, with higher-priced subnets receiving more TAO allocation, thus achieving automatic optimization of resource allocation.

This mechanism significantly improves the efficiency and fairness of resource allocation, solidifying the value of the TAO token and providing more avenues for ordinary users to participate in network governance.

The most active subnets currently include:

• Subnet 4: Focused on AI inference services for text generation, characterized by fast response speed and low cost.
• Subnet 64: Provides various LLM API interfaces, allowing developers to build and deploy AI applications on the Bittensor network.
• Subnet 8: Focused on the financial sector, incentivizing miners to generate accurate trading signals through a reward mechanism, covering various financial markets such as foreign exchange and cryptocurrencies.
• Subnet No. 52: Perform data labeling, encourage users to earn tokens through data labeling.

Vana: Data Sovereignty and Value Reconstruction Platform

The Vana project focuses on addressing a core issue in today's digital economy: the ownership and value distribution of personal data. The innovation of Vana lies in establishing an ecosystem where users truly own and control their data while being able to derive economic benefits from it.

As an EVM-compatible Layer 1 blockchain network, Vana's technical architecture comprises five core components:

1. Data Liquidity Layer: This is the core of the Vana network, which achieves the incentive, aggregation, and verification of data assets through data liquidity pools. Each DLP is a smart contract specifically designed to aggregate specific types of data assets, such as social media data, browsing history, etc.
2. Data Portable Layer: Ensure that user data can be easily transferred between different applications and AI models, enhancing the flexibility of data usage.
3. General Connection Group: Track the real-time flow of data throughout the entire ecosystem, forming a data ecosystem map to ensure the transparency of the system.
4. Non-custodial data storage: One of Vana's important innovations is its unique data management approach. Users' raw data will not be on-chain, but rather stored in locations chosen by the users, such as cloud servers or personal devices, ensuring that users have complete control over their own data.
5. Application Ecosystem: Based on data, Vana has built an open application ecosystem where developers can leverage the data accumulated from DLP to create various innovative applications, including AI applications, while data contributors can receive dividend rewards from these applications.

Latest Development Trends

Vana's financing and collaboration expansion continues to advance:

• In February 2025, an institution announced a strategic investment in Vana, and a well-known individual joined as an advisor.
• In terms of ecological construction, Vana has built data projects covering multiple fields from social media data to financial forecast data, including: Finquarium (financial forecast data), GPT Data DAO (ChatGPT chat data), Reddit Data DAO (Reddit user data), Volara (Twitter data), Flirtual (dating data), etc.
• Recently, Vana organized a hackathon during a certain event, offering a substantial prize pool to incentivize developers to build DataDAO and AI applications based on Vana data, further expanding its ecosystem.

These developments indicate that Vana is actively building a complete ecosystem around data ownership and value realization, and its growth momentum is worth paying attention to.

Kite AI: Technical Breakthrough of AI-native Public Chain

Kite AI is a native Layer 1 blockchain project focused on the field of AI, built on the Avalanche framework. It aims to address various challenges faced by traditional blockchains when handling AI assets, particularly how to achieve clear rights and incentives for AI data, models, and agent contributions. Kite AI proposes four core technological innovations:

1. PoAI Consensus Mechanism: Proof of Attributed Intelligence is a consensus mechanism pioneered by Kite AI, which accurately tracks the value contributions of data, models, and AI agents through an on-chain verifiable contribution record system. The project has designed a dynamic reward pool mechanism that allocates profits based on contribution proportions, effectively addressing issues such as "data black box" and "model plagiarism" in the traditional AI economy.

2. Composable AI Subnet: Kite AI adopts a modular architecture, enabling developers to build industry-specific AI collaborative ecosystems on demand. For example, in the healthcare subnet, patient data can be encrypted and selectively authorized to pharmaceutical companies for AI model development, with profits distributed among data subjects, model developers, and subnet maintainers in a certain proportion, creating a multi-win ecological environment.

3. AI Native Execution Layer: Kite AI is building an on-chain AI native execution layer specifically for handling AI computing tasks such as inference, embedding, and fine-tuning/training. Users can authorize smart contract wallets to execute inference calls and interact with models through this layer. This execution layer not only supports blockchain transactions and state changes but also integrates confidential computing environments (such as Trusted Execution Environments - TEE) to ensure data security and privacy protection during the computing process.

4. Decentralized Data Engine: Kite AI ensures that data creators receive fair compensation in the AI workflow. The platform includes compliance modules that adhere to regulations such as GDPR/CCPA, meeting data privacy requirements worldwide and reducing compliance costs for developers.

These technological innovations enable Kite AI to create a fairer and more transparent value distribution environment for AI developers and data providers, promoting the decentralized development of AI technology.

Development Status

Kite AI launched the Incentive Testnet on February 6, 2025, which is the first AI-native Layer 1 sovereign blockchain testnet. The testnet performed remarkably well after going live:

• Less than 70 hours after the test went online, the number of connected wallets exceeded 100,000. As of now, a total of 1.95 million wallets have joined the incentive test network V1, of which over 1 million wallets have interacted with AI agents, with a total of over 115 million calls.

• The project has a strong background, built by an experienced Silicon Valley team. The co-founders have extensive technical leadership experience in the field of artificial intelligence and have worked for several top tech companies. Core team members come from industry-leading enterprises and have academic backgrounds from top universities.

• In terms of capital support, the project has received investment from multiple top institutions and has established technical cooperation relationships with several well-known projects.

• As a selection committee member in the AI program of a certain platform, Kite AI plays an active role in promoting the development of the platform's artificial intelligence ecosystem. This collaboration aims to establish the platform as a leading blockchain for AI applications.

• With the global data economy expected to exceed $70 billion by 2025, Kite AI is poised to become an important infrastructure for data rights confirmation and monetization, and its development potential is worth looking forward to.

Nillion: Frontier Exploration of Privacy Computing

Nillion is redefining the way sensitive data is processed through its unique "blind computation" technology, paving new paths for future digital privacy protection.

Nillion is a decentralized public network based on an innovative cryptographic primitive called Nil Message Compute (NMC), which allows network nodes to operate in a non-traditional blockchain manner. This project was established in November 2021, led by a group of forward-thinking innovators, aiming to create a system that can securely handle high-value data without exposing sensitive details.

Nillion's core advantage lies in its "blind computation" capability------a process that allows data to remain encrypted throughout its lifecycle of storage, transmission, and processing. Its technical architecture integrates various cutting-edge privacy protection technologies:

• Multi-party computation ( MPC ): Enables multiple nodes to collaboratively compute a function without disclosing their private inputs, achieving joint computation without sharing data.
• Fully Homomorphic Encryption ( FHE ): Allows direct operations on encrypted data, ensuring that data remains encrypted from start to finish, providing end-to-end privacy protection.
• Zero-Knowledge Proof ( ZKP ): Provides a method to verify computations without disclosing any underlying data, enhancing the trustworthiness of the system.
• Nada Language: This is a domain-specific language designed for creating secure MPC programs, which simplifies the development process of privacy-preserving applications and reduces the learning curve for developers.

Nillion's network architecture consists of three main layers: the processing layer ( responsible for secure computation ), the coordination layer ( NilChain, which manages communication between nodes ), and the connection layer ( that serves as a gateway to connect external systems ). This multi-layer architecture enables Nillion to provide powerful computing capabilities while protecting data privacy, catering to the needs of various privacy-sensitive scenarios.

Latest Development Progress

According to the latest information, the development of the Nillion network is progressing steadily:

• The Nillion mainnet is scheduled to launch in March 2025 (this month). The total supply of Nillion tokens is 1 billion.