Chapter 9: China's AI token economy

All right, gentlemen, diving back in. I want to shift our conversation to money and the economy uh and a story that tells us where it's all going.

So this week it was reported out of China that AI tokens are becoming a consumer currency in the People's Republic of China. Banks give them as credit card rewards. China Telecom sells access to 142 AI models like a mobile data plan. Restaurants hand you compute credits after your meal. But here's the number that really woke me up this morning: China's daily AI token consumption, get this, went from a hundred billion in 2024 to 500 trillion by mid of this year. That's a 5,000-fold increase in two and a half years. I guess that happens when intelligence gets too cheap to meter. As we've said, they become loyalty perks, you know, kind of airline miles for thinking.

Uh, Salim, your thoughts on this?

You know, it is um — hold on, my brain is — my — I'm just trying to process the — can I make a comment about our Moonshots day?

Sure.

There is, you know, we've covered in this last few moments — and I think it's really important to point something out. We have this amygdala that's scanning for danger. Therefore, we have this preponderance for focusing on bad news. Right? When you see something new and that you don't understand, you refer — or you reference it as dangerous, and it lights up the amygdala and therefore everybody freaks out.

And our job as a human being in this particular time is, when you see something new, like AI kind of solving major problems, don't relate to it as negative, relate to it as abundance and positive, because that's what it's actually delivering. So my brain is kind of stuck on that model, and I think the positive framing of this — like this is one of those inflection point days, the Moonshot Summit, that people coming in will get their brains trained on positive thinking for the next 10 years.

Rewiring — rewiring your neural net, right, to optimism.

Please come or attend or watch or consume it one way or the other.

Yeah, thank you for that.

So, I'm stuck on that. Go to somebody else.

I think on the China giving out tokens too, I — it dovetails exactly with what you were saying. You need to find like-minded people in America who are trying to ride this wave and not get crushed by it. But I remember when the PC came out, if you're hanging around a high school, a huge fraction of the high schoolers are like, you know what? I'm too cool for that. I'm not going to the computer. I don't care, you know? And then now, where are you? The AI is like that all over again.

And in China, they don't have that problem. Everybody's into it, which is why they're giving away compute credits, you know, with bank accounts and with — but because everyone's like, this is huge and I want to be part of it. In the US, you're going to get a counterculture. You always get a counterculture. And so, if you come to the Moonshot Summit, you're with like-minded people, and you can kind of tune out the counterculture. But it'll be — the counterculture is going to be rampant. It's going to be led by Bernie Sanders probably. It's going to be saying like, I sat it out, I deliberately revolted by not taking part in it. Just ignore the hell out of those people. They will absolutely be roadkill. You don't want to be part of that. You want to be part of this.

Yeah, for sure. Emad, you've thought through the economy — uh, an AI token economy like this, loyalty points —

Uh, well, I mean, it's increased capabilities, increased access. Let's put it this way: the average Chinese person and their AI will be smarter than the average American and their AI. The average Chinese person and their robot will have more manual capability than the average American. And so Americans are going to be left behind. Europeans are going to be left behind unless we get our heads out of our butts and actually [embrace] technology.

Change our mindset, right? Change our mindset.

Do you want to be stupider than the Chinese? That's actually the question.

I think the other way to build on — Emad, what you just said — is intelligence is becoming infrastructure, right? And you need to kind of focus it in at that level. It's becoming a foundational layer and you need to just accept that and move forward with that paradigm.

I really want to push back too on this "too cheap to meter," you know, comment which has come up a lot. You know, is electricity too cheap to meter? No, obviously not. It's expensive. AI is the same thing. Like, it doesn't matter — we're driving down the cost by 100x to a million-x for sure. But what you can do with 5,000, 500,000 or 5 million agents is mind-blowing. It's skyrocketing, you know, and so I don't think people are going to want less agents. They're going to want many, many, many more. And so the budgets are going to be real.

So if someone gives you free tokens, free compute, free opportunity, you should grab it and savor it because it gives you a chance to get on the map and get ahead. But I don't think too cheap to meter is ever going to happen. I think the use cases go to infinity at the same rate that the costs come down.

Fascinating. Alex, your thoughts?

I have to point to the elephant in the room, which is there was the old kind of tokens that we're not talking about here that is essentially irrelevant in China, which is crypto tokens. So we find ourselves in a future where the tokens at issue are ones that embody individual units of superintelligence and have nothing to do with sort of zero-sum financial exchange.

I think we're on a trajectory, and I think China is the bellwether — for better or for worse is the bellwether here — for universal basic compute or universal basic capability. Right now it starts in China with credit card reward points; you get AI tokens in the not too perhaps distant future. Maybe we start to see token socialism, where the party, in the case of China, or you know some western — not quite analog, that's too strong, hopefully — uh, but you know, the equivalent instruments of state power are starting to issue, whether it's via credit card points or whether it's via welfare or whether it's via some other mechanism, a redistribution — tokens, UBT — a redistribution of superintelligence tokens. I think we're starting to see the very beginning of that in China, but I think that's going to blanket all of humanity.

Yeah, we actually see that South Korea have announced that — for universal AI for all the people through a consortium — and that's the core of the Champion initiative that kind of we're doing as well.

That's what Bernie should be talking about, not ban AI. It should be tokens for everybody. Make it a universal right.

And I think they want them to be smarter. That's the thing, you know, like, um, it's not like that. There's a very good book on this, Fully Automated Luxury Communism, you know.

Yeah. No, I'm familiar with it. And I think this — by the way, it's not just about tokens for everyone. It's not just about — maybe there's some ism that we're missing, like tokenism. We need to coin tokenism here. Free tokens, or essentially post-scarce universal basic tokens for everyone.

But I think this is where, when Peter, you talk about abundance, this is where all of the other forms of abundance I think are likely to come from. We make tokens — at least universal basic tokens — essentially abundant for everyone. And then everything else, the healthcare, the utility pricing, the food, the shelter, the education, these are all downstream of getting everyone universal basic computing, universal basic capabilities.

100%. When you've got access to AI and robotics, you have access to everything you need in life.

Yes. Everything you need in life. Right.

Um, I think one point to make here, again, we've discussed on the pod a number of times, is the mindset of the US versus China. China is 80-plus percent pro-AI and the US is 80-plus percent against AI. And it is got to change. And I hope everyone listening to this podcast can hear why, right? This is the most important — this is, um, you know, this is a jetpack for your mind and for your life. This is how you get ahead.

Funny statistic on that, Peter, because I made that t-shirt, less talking, more tokens. Uh, and I wore it on the podcast a couple podcasts ago. About a third of people thought I was talking about crypto tokens instead of AI tokens. Another third thought I was talking about bongheads.

Like, okay, this would not happen in China.

So, yeah, that backfired on me a little bit.