Behind the Phala Network's explosion: TEE technology is well-prepared, adopted by ai16z, and the AI Agent is in the right time.

Many people are puzzled as to why PHA suddenly became popular for no reason. To put it abstractly, maybe even Phala Network didn’t expect it to become the chosen one overnight. Because there are both coincidences and inevitabilities behind the popularity of PHA, it is indeed not something that can be achieved by any conspiracy, mainly due to three key points: sufficient preparation for TEE technology, the support of a16z, and the opportune moment for AI Agent.

1. Phala Network’s dedication to TEE technology is the “inevitable” that makes this happen, why do you say that?

Although TEE (Trusted Execution Environment) is not a new concept, it has always been a niche topic in the mainstream technology narrative of Crypto in recent years. For example, there have been many high-performance chains competing with advantages of languages like RUST and MOVE, as well as a ZK technology trend dominated by ZK. TEE, MPC, FHE, Blind Compute, and other encryption technologies occasionally appear in the differentiated positioning of individual projects, but they are not on the same level as the popular ZK technology.

In fact, while mainstream chains are focusing on the efficiency of ‘block space’ utilization (MEV, TPS, Gas, etc.), ZK technology is only applied to the trusted state changes between the basic layer1 and layer2. The advantages of ZK technology in the underlying zkVM virtual machine, zkSNARKs data structure iteration, and other aspects have not been put into full use, let alone achieving Mass Adoption on a larger scale.

The main reason is that previous technical narratives have pursued a pure ‘on-chain’ environment. ZK is considered as the first step of separating off-chain computation and on-chain verification, but the ultimate goal is still to serve the ‘on-chain’ environment. The trusted execution environment (TEE) is naturally a ‘pre-processing’ process in the off-chain secure enclave environment.

It can serve on-chain, and also results from the gradual expansion of Pre-confirmation new narratives brought by top projects such as Unichain and Flashbot. In other words, without combining the chain, TEE is definitely a mature technology of pure web2. Combined with the chain, it can bring about clever uses such as trusted pre-processing and isolated privacy computing.

Therefore, those who dare to apply TEE technology to the blockchain field must have the patience to endure loneliness and have unique and wise insights. In this regard, PhalaNetwork does have a mature TEE solution, without a doubt;

2. Phala Network unexpectedly encountered a mysterious customer called ‘ai16z’, who adopted their own TEE solution, which is the biggest ‘accidental’ factor for PHA to become popular.

After seeing the AI-Pool official tweet about the AI Agent issuing coins autonomously, I immediately tweeted a technical interpretation of the TEE solution (TEE can enable AI to autonomously manage private keys and sign applications in a secure enclave environment that is usable but not visible), as well as the historical opportunity that Phala and ai16z cooperation may encounter (which is also an excellent entry position for most retail investors).

It goes without saying that ai16z currently holds a dominant position in the AI Agent track with its super commercial IP. The fact that AI-POOL adopts Phala’s TEE solution indicates at least two things:

1. Phala’s TEE solution has many mature commercial cases and has been selected by ai16z;

2. Phala’s TEE solution will be the first to benefit from the AI Agent PumpFun, which is a commercial vision for controlling private keys and issuing coins.

Understanding this, you naturally understand what Phala can gain from the phenomenon of AI-Pool, intelligent agent self-issuance. It’s a very natural logic, as the AI Agent issuance trend continues to drive, TEE’s private key management and remote attestation services will become ‘must-have’ businesses, while a complete set of on-chain verifiable consensus adapted to the TEE off-chain environment will be a bonus, undoubtedly the new infrastructure of the AI Agent era.

So, even though I bought PHA, I may not really understand Phala Network, but it doesn’t matter. I think I understand the market potential and incremental opportunities that AI Agent+TEE and AI Agent+Chain may have.

3. What really gave Phala Network a sense of push was the current hot AI Agent narrative. I have pinned several articles about AI Agent narrative in the Twitter Profile highlights. Friends who have recently followed me can take a look. The four words ‘don’t miss it, don’t miss it, don’t miss it’ are written between the lines in those articles.

Because AI Agent derived from AI MEME, then launchpad platforms such as Virutual and Vvaifu emerged, followed by individual AIs such as AIXBT and Zerebro, and then frameworks and standards such as ELIZA and ARC emerged. Finally, even old chains like Phala were blown into the limelight. Everything is evolving rapidly, almost beyond everyone’s imagination. Why?

Just one point, because this is a historic opportunity, the main uptrend of the DeFi Summer. The eruption of innovative gameplay, the thirst for hot money, the opportunities created by information asymmetry, etc., are destined to remain “hot and spicy” throughout this process.

So, I shouted the slogan loudly just hoping that more retail investors can seize the Alpha growth opportunities, and more projects can break free from the old narrative of ‘unable to deliver’ in the pure VC coin era.

A new narrative tornado is brewing, with the aim not just to blow dust (chicken feathers) in your face as it passes, but to send you to the forefront and become that piglet rolling in wealth.

By the way, the implication of this passage is not to worry about missing PHA, because Phala is just one of the players on the trend. It is the first to enjoy the trend dividend. Please believe that there will definitely be more opportunities according to the logical and directional narrative evolution I have sorted out.