Nightframes: The AI Agents Charles Says Come After Smart Contracts

0:00 All right, guys, you got to check out this video presentation. I've cut this one down for you guys, but this is Charles at the Midnight Tokyo event, Midnight City Tokyo event, going through what he calls Night Frame. So let me just play this and I'll go through it for you guys.

0:15 Smart contracts aren't like you. They don't know your intention. They don't understand you. They're not intelligent. They say smart. That's the biggest marketing garbage I've ever heard. They're pretty dumb. All right.

0:27 So like I said, this is Charles at the Midnight City Tokyo event asking what comes next after smart contracts. And his answer is night frames. And this is really cool. He explained this at the workshop that we had at the Token24 event. So we're going to go to a little bit of a deep dive here. So the Midnight crew asked us creators to react to this. And this is my honest take about everything here. Some of the key moments from this presentation, it does go for an hour, but I cut it down to just nine minutes for you all. And I'm going to explain what it all means in plain English so you understand exactly what he's on about. So for a quick context, Charles says the next generation blockchain needs privacy, compliance, not caring about what

1:14 chain you're on. It needs AI agents. And this is his big question here.

1:20 So the question is, is the smart contract good enough so that if I take these four concepts, that I can run all of that in the blockchain space? Or do I need something new, something different? Well, here's what we have. A night frame. So a night frame, what the hell is that? It's the successor to the smart contract.

1:44 It's something new. It's something different, just like the smart contract was something new, something different. It's a private, always-on computer that runs your program, follows your intent, and also, most importantly, provable.

1:58 Cool. So a night frame. So think of it as your own AI agent that never switches off. It runs your programs privately, follows what you mean rather than what you type. And it can also prove what it did. So that's what night frame is.

2:16 Why is it different? Well, you got three I's and a P. First, your computer doesn't really care who the user is. This one does. It knows your identity and it has its own identity. Second, it understands your intention. When you use a computer, does a computer typically understand what you want? Not what you told it to do, but what you want. Third, it seems to have intelligence.

2:42 Not only does it understand what you want, it understands how to solve that problem for you, that goal for you.

2:50 And the P is personal. And in Charles' example of booking a flight where it already knows you can't fly at night or need extra legroom. So to be fair, there's already big AI assistants already doing a version of this. But... The difference is in this next clip here. So let me just play it.

3:11 But the issue is the identity is owned by a big company. The data is owned by a large company. And you don't own it. So if we're going to build this always-on computer, this night frame, it has to have the properties of the cryptocurrency space. It has to be non-custodial. You own it. You own your own night frame.

3:33 It's yours. You control that. It has to be decentralized. Nobody can shut you off.

3:41 And that's the core of it for me. So right now, the AI that knows you best belongs to another company. They own the account, the data, and the off switch as well. So at any point in time, I don't know where I would be if Claude or GPT switched off and cut me off. And I wasn't able to use it ever again. All that time that I've spent using these AI agents for the work that I do now, it's very intertwined into my business. And if I was to have them be cut off, I would have to revert so much stuff that I've been doing previously to rework it into my business and how my business operates.

4:30 So I'm at their whims now. So it's I'm at their mercy. So it's kind of scary when I do think of it that way. And at any point in time, they can cut me off. So Charles is applying the oldest rule in crypto here. So not your keys, not your coins, and in this case, not your AI.

4:49 Now let's make it personal. You're in Switzerland. Oh, but you just broke your leg. Oh no, we're skiing. Okay, so what do you do when you break your leg? You go to the hospital. Okay, and what do you need at the hospital? You need to give them your medical records. Have you ever really thought about this problem?

5:08 You're here in Japan. You're here in Tokyo. You have all these medical records. And every now and then you travel. And when you go abroad, you have to share those with somebody. How do you share them and get a guarantee that they're only going to use what they need and they don't stay behind?

5:24 Yeah, good point there. Very good point. So this one hits home for Australians and plenty of us have ended up in a clinic in Bali or Tokyo. And right now it's all or nothing. Hand over your entire history. You call your doctor from home and they send over everything or you get treated blind and they have no idea what's going on or your medical history at all.

5:48 So the idea is that night frame proves what your doctor needs. like allergies and medication, and nothing stays in their system afterwards. So my question is, how a hospital checks that proof in practice? So let me continue the clip here.

6:08 So how does that work? Let's say one of you is an extraordinarily talented firmware developer for hardware from the 1980s and 90s. There's at least one person, especially here in Japan, because you guys are like the best hardware makers in the world. I would love to have a marketplace where I can just grab one of those skills.

6:24 The very same skill that allows the agentic trading allows you to put that up there. And this is the first time ever agents across the whole AI space have DRM. Instead of sharing the skill, you rent the skill. It's the new SaaS model for everybody, for the individual, for the corporation.

6:45 All right, so when Charles explained this at our workshop, I got really excited about this. Being able to rent skills. So for those that aren't aware, when you're using AI agents, you can download skills, get them from GitHub, and they're all essentially free at the moment. So people spend all this time and energy crafting the skill, getting it right, and then you just download it for free and someone else uses your knowledge and expertise. So that's where it is at the moment. So here is... This is how I picture it. I've built website for years. Say I can package my site audit process as a skill and your agent rents it and pays a small fee and gets the report and knows what to do after that.

7:32 So my method never leaves my hands and I earn every time it's used. And for an agent to pay for that, it needs an identity and a wallet. And that's where and what crypto is best at. So let me continue the clip here.

7:50 And who will be the purchaser of them? Not you, the human. You just said, hey, go find some stuff and write that report for me. The agent's going to have to figure out what skills to buy. But if an agent is buying skills instead of downloading skills, what does that mean? It means an agent has to have a wallet. You getting it? The cryptocurrency space is the only space. to save the AI space.

8:17 I love that line there. The cryptocurrency space is the only space to save the AI space. That's pretty interesting to see. Anyway, let me continue the clip here.

8:30 It has to know your intention. If it has a wallet, it's not good enough to just have a wallet. It has to know, what do I spend your money on? Where do I spend your money? The how, that's its problem. That's what intention means. And it has to have identity because it has to know you made that decision. These things need to know you to be effective for you.

8:53 But for them to know you, you must own them.

8:56 Yeah. And this is where I want to see more. So giving an agent a wallet, that's the easy part. And I've done that. And I've given my wallet to agents and they go off and spend crypto and I lose all that. So that's the easy part. Trusting it. is the hard part. So before one spends, for me, I want to have limits that I set. I want a list of what it can buy and I want receipts that I can actually check. So ideally, a proof it followed my rules without exposing my data, that would be ideal. So Charles says night frames are provable. And that's the claim I want most demonstrated. So I want to see Nightframe in action with all the proof and receipts so that I know that my agent is actually doing what it says it's doing and is buying what

9:56 I allow it to actually buy.

9:58 Well, how about Midnight City? That's what it is. Midnight City under the hood. All those little avatars you see walking around are night frames. They actually have advanced cryptography. They have large language models. You can use them to test new ideas.

10:17 Yep, and this is where I'm going to play around a lot. So it's a big playground at the moment. I've got my own custom avatar that the Midnight City team created, and I will be playing around with it more to see what I can actually do and what I can break. So if you haven't seen it, Midnight City is at midnight.city. I'll put the links down below for you guys. It looks like a pixel art kind of game, top-down multiplayer game. RPG. But Charles says every character walking around in there is its own night frame.

10:54 And there is a reason for that. So let me continue the clip.

10:58 The point of something like A Midnight City is to have a self-evolving world that when you start, you start with these that have no stakes, that have no money, that have no consequences, none of your personal data. You learn in the process of doing that. And in the process of learning and building, you build empathy.

11:23 Interesting. So I think this is the smartest part. So you don't hand the agent your wallet on day one. You let them interact with nothing at stake and watch what breaks and then fix it. And it's the same reason we use testnet for mainnet. You want to make sure that everything you think should be working actually works as intended.

11:48 Let me repeat that. They work for you. They don't work for Sony. They don't work for Toyota. They don't work for Charles Hoskinson. They don't work for OpenAI. They don't work for the US government. They work for you. It means they don't waste your time. They don't waste your money. They don't advertise products that you don't need.

12:14 Midnight City is not a game. It's not a demo. It's the front page of this new paradigm. It's the place that they live, they act, they operate.

12:25 All right, guys. So here's my take. So night frames are a big idea. And the AI agents you own that keeps your data private rent skills from other people and proves what it did. A lot of that is still Charles describing where it's heading. And what I want to see next is a night frame on an ordinary phone.

12:55 That'd be amazing. I want to see a skill rented without methods leaking and a proof that I can check for myself. If that lands, if those things land, This is a real step past smart contracts. It's a massive step past smart contracts. Would you let an agent spend money for you? What would it need to prove first?

13:20 So tell me in the comments down below. Midnight City is linked down below as well. So if you want to check it out, do check it out. Let me know in the comments, guys, what you think of Midnight City and what you want to see out of this as well. It's pretty exciting stuff. Charles got me all excited when he was talking about this in the workshops and I'm pretty sure you guys will be excited too.

13:41 If you want to check out the full video presentation from Midnight City, Tokyo, again, links down below for you guys. Until next time, stay positive and I'll see you in the next video.