Making smart contracts smarter: why we invested in Space and Time

Space and Time’s co-founders Scott Dykstra, CTO (L) & Nate Holiday, CEO (R)

By Cameron Coombes, Vice President, Digital Asset Fund, and Robin De Baets, Associate, Digital Asset Fund

Over the past few years, retail and institutional adoption of blockchains has exploded, with millions of people leveraging the technology for everything from day-to-day payments to innovative social applications, all the way through multi-billion dollar asset management.

This wouldn’t have been possible without champions of the technology pushing the envelope on what is possible for scalability and user and developer experience. While these improvements, and the corresponding capital deployed behind them, started at the fundamental base of the technology (blockchains and their corresponding primitives), we have recently observed a new class of companies building products which expand the design space of current infrastructure. Thus increasing the collective total addressable market of applications leveraging blockchain technology to build a better internet.

Furthermore, all of this is happening as we experience one of the largest technological shifts of our time, specifically the growth and everyday acceptance of artificial intelligence via the conduit of generative AI.

Nonetheless, despite significant capital investment, clear signs of nascent product market fit, and a plethora of talented human capital, cracking the code on building outside of the traditional “web3” audience has proven difficult.

For many slower-moving enterprises, blockchain is still a primitive technology prone to many risks both realised and unrealised, and while we’ve certainly seen a large interest in the adoption of the technology, it’s taken time to see that translate to real business fundamentals for product companies focused on enabling this shift.

More recently, however, we’ve witnessed a renewed urgency in the principles of blockchain with the adoption of closed artificial intelligence systems.

This led our team to several conclusions:

1. Blockchains are a transformative new internet architecture, but it’s still too big an ask for enterprises to build with them out of the box,
2. to build a fundamentals-driven product, it’s going to be critical to bring these enterprises on chain,
3. only a best-in-class team solving a real problem will be able to satiate these customers' needs,
4. finally, there is no market where the need is more acute than within artificial intelligence.

So, when we met the Space and Time team, we knew they were on to something special.

Bringing Trustless Data On-Chain

Space and Time’s core product is a data warehouse that offers familiar database access whilst also offering tools to ensure the cryptographic integrity of the underlying data.

The Space and Time platform is a hybrid transactional/analytic (HTAP) data warehouse that is highly scalable and takes advantage of GPU acceleration. Their innovative data querying solution is called Proof of SQL, which uses zero-knowledge (ZK) technology to guarantee that both a query and the underlying data are verifiably tamperproof. The immediate implication of this (within the context of blockchain) is trustless querying of both on and off-chain data for smart contracts, which ultimately serves the purpose of making them much more “smart.”

This enables some very powerful use cases:

1. Train large language models on provable data sets: Build transparent, tamperproof, and provably neutral LLMs. With Proof of SQL, Space and Time can guarantee that.
2. New financial instruments on-chain: Space and Time allows smart contracts to ask complex questions about on-chain activity, as well as combine real-world data with on-chain transactions to enable new financial instruments on-chain.
3. Trustless SQL database: Space and Time is a trustless SQL database that lets you join provided data indexed from major blockchains with off-chain data loaded from any source. This is very valuable for both Web2 and Web3 native business applications and underscores why Space and Time has been able to attract marquee clients from both user groups.
4. Decentralized lending: With Space and Time, you can combine real-world credit scores with on-chain transactions to create new Web3 credit scores for decentralized lending platforms.
5. Power better gameplay and on-chain earnings: Join in-game events with on-chain activity/transactions. Run analytics to generate deeper insights into what your community is doing in-game and on-chain. Understand what’s happening in your game and what led to an on-chain purchase.

Empowering the next generation of blockchain applications

With Space and Time’s sub-second ZK processor, smart contracts can now process data at the scale required to power a new wave of applications, some of which are mentioned above, with many still to be explored.

The Space and Time team themselves have even leveraged their own infrastructure to build one such application.

Recently, the company has launched a best-in-class tokenomics platform (aptly named) Space and Tokens. Customers can use Space and Tokens to simulate tokenomics, better anticipate token performance and market risks, and build comprehensive analytics and dashboards around their token economy, all powered by SxT’s verified on-chain data.

Looking ahead

Space and Time is delivering verifiable compute at scale in a time where doing so has never been more important. As developers increasingly look to make their smart contract “smarter” and artificial intelligence and its subsequent integration has become all the more important to drive the future of use-cases in crypto, Space and Time’s product will become a core piece of infrastructure leveraged by Web2 and Web3 enterprises alike.

We’re delighted to have participated in this landmark $20mn Series A funding round alongside marquee investors like Framework Ventures, Lightspeed Faction, Hivemind Capital, Arrington Capital, Microsoft’s M12, and many others.

We couldn’t be more excited to put our weight behind Space and Time as they continue to expand the design space for blockchain applications. If you’re interested in learning more, please reach out to Robin or myself, or the team at Space and Time at solutions@spaceandtime.io.