Bluwhale Alpha Opportunity

Market Overview

Large Web2 corporations have harvested user data for their AI algorithms for decades, creating monopolies to dominate the Internet through personalization. Over time, this has stifled innovation, making the web less dynamic, fair, and appealing for new builders, as power has concentrated in the hands of the top 2% regarding developing the AI that serves consumers the right content, assets, products, and services in the digital world.

In essence, the "Web3" movement emerged with a fundamental goal: to challenge the current status quo of "Big Tech says so" by restoring individual sovereignty on the Internet, placing economic and governance power in the hands of the masses, and ensuring that value flows to the edges of the network. This would decentralise the direction of AI, compared to single decision-making around AI from companies like OpenAI, Microsoft, and Google.

As is often the case, big market opportunities attract significant pools of capital and talent. Recently, we have seen the emergence of a wave of AI projects working on this. Bluwhale has caught our attention.

Overview of Bluwhale

Bluwhale is Web3’s intelligence layer that transforms and contextualises consumer behaviour data into insights using a knowledge graph structure. The project uses AI to aggregate and visualise crucial audience information to match wallets to businesses for targeting via on- and off-chain messaging. It is also worth noting that Bluwahle is a two-sided marketplace where users can optionally share their preference profiles and data with the different apps they interact with, contributing via their smartphones. When users choose to share their data, they become a part of the revenue distribution system and are actively rewarded in Bluwhale’s AI network.

In that way, apps can gain insights into their user base across chains for profiling, discovery, and growth of potential audiences. More importantly, as users leverage mobile to become part of the ecosystem, they not only control their data on their devices but also could grow contributions through storage and computing for financial rewards in the future while maintaining their privacy at all times. This is a key part of building a user-owned internet.

Web3 AI Architecture

The Bluwhale protocol is an intelligence layer that fits seamlessly between applications and protocols. It provides intelligence through data acquired on-chain, smart contracts, and protocol transactions and feeds insights into dApps and users. 

Data indexed on-chain or visualised through analytics platforms still requires manual work to evaluate and explain before it becomes valuable to an organisation or individuals. However, only a few players are transforming the data into an intelligent dynamic “brain” that will ultimately tell us what the best decision forward is, like Bluwhale’s intelligence layer.

While initially, Bluwhale serves as the brain layer connecting infrastructure to applications through data transformation and intelligence; it could disrupt the entire space by leveraging smartphone nodes for data, storage, and computing to tap into a potential market of 7B devices. 

There are three core modules of the intelligence layer:

Data verification module: This layer involves community verifiers who validate attestations, ensuring secure and accurate operations within Bluwhale’s network. This module ensures that on-chain and off-chain data seamlessly integrate with each other by leveraging a reference verification approach through nodes. 

Identity embedding module: This layer authenticates users using traditional (Web2) social accounts and blockchain (Web3) identities. It integrates identities and data through knowledge links, rankings, and other contextual models.

Privacy inference module: Built on Zero-Knowledge technology, this layer manages users' data, allocating rewards based on enterprise or individual demand and the processing required to gain insights about the wallet or user.

Bluwhale’s Uniqueness

Bluwhale stands out in many ways. Here are some of their innovative approaches and breakthroughs:

1. AI Matching: Bluwhale uses AI to accurately profile individuals based on multi-wallet identities and data, similar to Google's indexing model, which improves accuracy with more references per index. The company uses this approach to accurately match consumers to enterprises, assets, services, products, and content in the digital world, making personalization universal.
2. Mobile Nodes: Bluwhale removes the technical complexity of nodes by removing the barrier for regular consumers to operate and earn tokens: no software downloads, technical setups, or specs to review. All a Bluwhale node holder needs to do is download the Bluwhale app, connect the wallet and, with a single click, operate and track node earnings in its user-friendly dashboard.
3. Social Nodes: Bluwhale is the first company to pioneer social behaviour in nodes by creating two types of nodes - Master and Common nodes. The Master nodes, which are only available during private and public sales, will be able to create communities of node operators and drive social traction around node earnings and performance. The Common nodes, non-tiered, will have only 1/10s of the Master node emissions and are available after the Node sale is closed. Those nodes will be able to join Master node communities.
4. Community Booster: Bluwhale nodes stand out for their community aspect, as the company offers to earn more for large communities that operate the nodes together. The more friends, followers, or family you invite to buy and hold Bluwhale nodes and run them with you, the more token earnings you and they can make. This mechanism follows the ethos of Web3 to decentralise and socially drive mass adoption.

Bluwhale’s Stats

According to the project documentation, they have indexed and trained on over 700 million wallets, providing a solid foundation for businesses to understand and efficiently reach their target audiences. Furthermore, Bluwhale claims to have over 800,000 unique users who actively participate and contribute to the network while receiving rewards for the popularity of their digital profiles. They also power over 3,000 enterprises across various sectors, including gaming, DeFi, SocialFi, media, protocols and many more. With an active social community across X, Telegram, Discord and YouTube, Bluwhale has brought together more than 200,000 community members across multiple languages.

Team & Investors

The Bluwhale team is composed of well-rounded talent with diverse expertise. The CEO and Founder, Han Jin, is a serial entrepreneur with a Master's Degree from UC Berkeley featured in Forbes 30 Under 30, Inc. 30 Under 30, and as one of the youngest in Business Journal 40 Under 40. Meanwhile, the CTO, Adam, is a Stanford PhD under Prof. Widrow (AI pioneer in the 90s) turned serial entrepreneur with deep expertise in AI technology. Other team members include former employees of Binance, DBank, Kucoin, and Huobi.

Moreover, Bluwhale raised over $8.5 million from notable investors such as SBI, Animoca, Cardano, Momentum6, G42, and GSR, as well as prominent angel investors like the General Partner of Dragonfly, Haseeb Qrechi and the founder of Oculus and Guitar Hero.

$BLUAI Tokenomics

The BluAI token will serve as the utility token within the Bluwhale network and is designed to play a crucial role in facilitating transactions, incentivizing stakeholders, and enabling on-chain governance. The intended initial distribution of BluAI is as follows:

For now, the primary utilities of BluAI tokens are:

Governance: The token will allow holders to propose and vote on on-chain governance proposals to determine future features and parameters of the platform, with voting weight calculated in proportion to the tokens staked.

Rewards: These are incentives allocated for activities that positively contribute to the growth and vibrancy of the Bluwhale ecosystem.

Use-to-Earn: BluAI will be the primary medium of exchange in the Bluwhale ecosystem for businesses leveraging the platform and for users who are rewarded for sharing their data.

The Alpha Opportunity - Become A Mobile AI Node Operator

Bluwhale’s Master nodes are core components of the data verification module and are key when training and inferring AI on accurate data. They are community-operated and ensure the protocol's integrity, decentralisation and security.

The maximum supply of nodes is set at 100,000 and 25% of total BluAI supply will be allocated to them, and those rewards are expected to be distributed within a time frame of 48 months.

Valuation and Scenario Analysis

The potential return on investment for node operators is influenced by various factors, notably the numbers of nodes that are running and sold out. Therefore, for this study, we are using Bluwhale assumptions and different expected scenarios to derive the potential rewards of these nodes.

With that in mind, here is a potential return simulation over the whole period:

For better visualisation, here is a table showing the expected return on investment over the whole period:

Lastly, using the same set of assumptions, this is the expected return on investment after the first 6 months of rewards:

FAQ

• What are the terms of the Bluwhale Alpha Deal?
  All terms can be found here .
• What is a Borger Journey Camp and how do I know which camp I am?
  Your Borger Journey Camp is found under the Profile section of the SwissBorg app. Any Camper is eligible for exclusive benefits, among others access to Alpha Early Deal, including the Bluwhale node sale. 
• Can you tell me more about the deal itself? What am I buying?
  By participating in the Bluwhale Alpha deal, you are buying a Bluwhale Master node. These nodes will be set up on your behalf by our partner and you will become eligible to receive subsequent monthly rewards, generated by these node devices on a regular basis. 
• Can you tell me more about the rewards? How and where will I receive them?
  By investing in this vault, you become eligible to receive the Bluwhale token (BLUAI) rewards for 4 years after the Token Generation Event (TGE). The rewards will be distributed on a monthly basis, starting with a 5-month cliff from the time of the TGE. The rewards will be deposited into your SwissBorg account. 
• Is the rewards issuance linear?
  No, rewards issuance is skewed towards the beginning, meaning more rewards earlier on. Over 50% of the rewards will be claimable in the first year. Keep in mind however that any claimed rewards are first vested for 4 months. 
• Are node holders eligible for node airdrops and will I receive it?
  Any potential rewards airdropped to node holders will be distributed to all Bluwhale Alpha Deal participants if eligible and viable .
• Does a successful investment provide you with the option to host your own node?
  No. SwissBorg’s partner will operate and manage all the nodes, so the investors do not need to worry.
• Is there a min/max investment per user? How much is it?
  Yes, all vaults always have a minimum and maximum investment. The minimum is one full Master Node. You can find a detailed answer in the term sheet . 
• What return could be reasonably expected across four years?
  Please read the investment thesis above for price projections.
• What happens to the Master Node NFT after four years?
  SwissBorg will sell the NFTs at the best price possible at the end of the period, and the proceeds, if any, will be distributed to the investors. Please keep in mind however, that we expect the value of the NFTs to be lower compared to today.