If knowledge is to become the new oil in the AI era, then Story aims to be its pipeline.
Written by: Deep Tide TechFlow
Recently, the cryptocurrency market has gradually felt like a tale of two extremes.
On one side, the on-chain track of AI Agents has collectively cooled down, while on the other side, classical infrastructure projects are gradually taking new actions.
In addition to Berachain's recent mainnet launch and token release, another highly anticipated intellectual property protocol, Story Protocol, has also updated its white paper, detailing its design and changes.
Last year, the project secured a massive $80 million in Series B funding led by a16z crypto, bringing the total funding to $140 million, and it has been highly anticipated by community players, with several rounds of testnet interactions being very popular.
The update of the white paper may also indicate that the project's mainnet and token launch are not far off.
If you are not yet familiar with Story Protocol, we have provided a more accessible interpretation of this latest white paper, hoping to offer you some reference.
Why create Story Protocol, and what problems does it solve?
We all understand that the narrative of a crypto project is crucial.
What is the narrative of Story Protocol? It starts with intellectual property.
The crypto community loves to talk about "killer applications," but the reality is—the real killer market already exists, it is just locked in the iron cage of Web2.
For example, intellectual property (IP) is a great example.
The global intellectual property (IP) market is valued at over trillions of dollars, encompassing all creative outputs such as film, music, patents, and AI datasets. However, this market also faces the "impossible triangle":
Problem 1: The "Greed Tax" of Centralized Intermediaries
Whether you are an independent musician or a research institution, if you want to commercialize your creativity, you have to pay a hefty "toll" to the platform:
Case: When Spotify pays royalties to record companies, the actual percentage that reaches creators is less than 15% [industry data], while the Story white paper points out that centralized platforms "increase transaction costs."
Point of Intensification: The AI era lowers the threshold for creative production, but the revenue-sharing model of centralized platforms cannot support the micro-payment needs of "long-tail creators."
Problem 2: The "No Man's Land" of AI Training
When Stability AI was sued for using artists' works without authorization to train its models, it exposed a fatal issue: the existing IP system is fundamentally incompatible with the large-scale production of AI.
Data: Training GPT-4 requires 45TB of text; if negotiated through traditional licensing processes, the legal costs alone exceed the model training expenses [estimation];
Insight from the white paper: "AI companies cannot generate billions of individual licensing agreements" → The result is that infringement becomes the norm, and creators earn nothing.
Problem 3: The "Desertification" of IP Liquidity
A demo of African folk music used in a popular song should have allowed the original creator to earn ongoing revenue, but the reality is:
Inability to Track Derivatives: There is a lack of automated royalty distribution tools for scenarios like secondary creation and cross-border licensing;
Value Waste: The white paper describes the current situation as "islands of non-interoperability," making it difficult for IP assets to generate compounding effects like DeFi.
If you want to solve these problems through legal procedures, the costs are high, time-consuming, and cannot cover AI-generated content (e.g., the spread of Deepfake videos far exceeds judicial response);
In traditional blockchain solutions, NFTs only address "ownership attribution," but do not touch on "usage rights circulation" (e.g., owning a CryptoPunk does not mean you can use it to train an AI model).
Story Protocol: The "Crypto Lego" in the IP Economy
In light of the above issues facing the IP economy, you can understand Story Protocol as: becoming the "underlying ledger of the knowledge economy"—any creative work, from a paper to an AI-generated video, can gain global liquidity here.
Positioning: The "TCP/IP Protocol" of IP
In the Web2 era, the TCP/IP protocol allowed data packets to flow freely across the internet; corresponding to the Web3 era, Story Protocol attempts to define a similar universal interaction standard for IP assets:
Core Functions:
Standardized Registration: Transforming IP into on-chain assets (IP-Asset), including ownership, licensing terms, and other metadata;
Programmable Interface: Any application can call IP terms through APIs (e.g., "allow derivative creation, collect 5% royalties");
Benchmark Cases:
SWIFT protocol (interbank settlement) → Story Protocol (IP settlement);
GitHub (code version management) → Story (IP derivative relationship map)
Three-layer Design of "IP Lego"
Base Layer:
PoC Protocol: IP registration and compliance verification (e.g., automatically detecting whether secondary creation infringes);
On-chain Fingerprint: Ensuring the traceability of AI training data through model hash values (e.g., the OML technology mentioned in the white paper);
Middle Layer (IPFi):
Fragmentation: Simply put, splitting a movie IP into 100 million NFTs to lower the investment threshold;
Collateralized Lending: Using unrealized patent IP as collateral to borrow stablecoins;
Royalty Securitization: Packaging future royalty earnings into ERC-20 tokens for trading.
Application Layer:
Possible human use cases: Independent musicians set automatic revenue-sharing rules for "sampling rights"; using a certain demo can generate income.
Possible AI use cases: Autonomous driving companies purchase training rights for street view datasets.
From Copyright Chain to the Settlement Layer of the AI Agent Economy
Short-term Goal: To replace traditional copyright offices, providing lower-cost, higher-transparency IP registration services;
Long-term Vision:
To become the "settlement layer" of the AI Agent economy;
To build a "on-chain knowledge graph"—a global view of each IP's derivatives, earnings, and collaboration relationships.
Story Protocol Technical Highlights: Layered Design and PoC Protocol
While other blockchains are still struggling with "how to make NFTs work," Story Protocol has chosen a more radical technical path—customizing a dedicated blockchain for IP. Its core innovation can be summarized as: not creating a general chain, but making an "acceleration chip" for IP.
Since it is a blockchain, it must go through several layers: execution, storage, and consensus.
We have distilled some important descriptions and key data from the white paper to present its technical design as simply as possible.
Execution Layer:
IP Core: Natively supports complex IP relationship verification (e.g., checking whether a song's sample has obtained authorization from all ancestor nodes), with the white paper revealing that the speed is faster than EVM;
AI Core (in planning): Optimizing on-chain model fingerprint calculations to reduce Gas costs.
Storage Layer:
Dynamic Tiered Storage: Hot data (e.g., IP licensing terms) is on-chain, while cold data (e.g., 4K movie source files) is stored on Arweave;
Unique "Storage Translation Layer": Automatically optimizes data locations, so developers do not need to be aware of storage details.
Consensus Layer:
- Based on CometBFT's instant finality, ensuring IP transactions are confirmed in 3 seconds (compared to Ethereum's average of 12 seconds).
Highlight: Proof of Creativity (PoC) Protocol
PoC is Story's "IP compiler," converting legal terms into executable code:
IP Accounts (ERC-6551++):
Each IP is bound to a smart contract account, supporting modular function expansion (e.g., adding royalty distribution rules) [15];
Case: When an artist issues an NFT, the clause "3% royalty required for commercial use" is automatically embedded without manual coding [16].
Automated Compliance:
Conflict Interception: If a film score references unauthorized sampling segments, NFT minting is automatically blocked;
Global Royalties: Automatically distribute earnings to all contributors (e.g., original authors, translators, remixers) based on the IP derivative map.
$IP Token: Leveraging the Knowledge Economy
Comparing Story Protocol to the central bank of the knowledge economy, the IP token is its issued "base currency"—serving as network fuel, a value carrier, and a governance credential.
Network Fuel:
Pay transaction gas fees (e.g., IP registration, licensing);
Stake to obtain validator qualifications (PoS consensus).
Value Medium:
Royalty Distribution: IP earnings are settled in IP tokens (e.g., revenue sharing for secondary creations);
Settlement between Agents: AI agents use IP tokens to purchase training data rights.
Governance Credential:
Vote to decide protocol upgrades (e.g., adding new core types);
Adjust key parameters (e.g., royalty distribution ratios).
Where might the demand for the token come from?
Gas consumption: Increases with the volume of IP transactions;
Staking demand: At least 30% of the total supply needs to be staked to maintain network security [8];
Speculative Demand:
IPFi scenarios: Collateralize IP assets to lend out IP tokens;
Governance premium: Scarcity of voting rights may drive up token prices.
Regarding the formal IP token economic model and distribution methods, the white paper does not mention them, and more information may be needed.
Summary
Story Protocol seems to be betting on a larger proposition: if knowledge is to become the new oil in the AI era, then Story aims to be its pipeline.
Beyond the white paper, an objective analysis of whether Story Protocol has a competitive moat is warranted.
From a technical perspective, the multi-core architecture mentioned in the white paper needs to deeply optimize the processing flow of IPs; if imitators want to replicate it, there may be certain difficulties (such as the IP core's graph traversal algorithm mentioned earlier). Additionally, the project's own blockchain storage layer's dynamic optimization relies on the accumulation of long-term data patterns; if Story leads, later entrants will inevitably face a time lag.
Moreover, the backing from a16z and the high amount of funding undoubtedly attract interest and attention. While the business and narrative expectations are one aspect, the market performance of the token also influences the business development of Story Protocol, which remains to be observed.
Some uncertain areas include:
Regulation: The legal recognition progress of on-chain IP rights varies by country (e.g., the EU's MiCA does not cover IP assets);
Cold Start: Early on, it is necessary to attract multiple top-tier IPs (e.g., Disney, Universal Music) to establish network effects; if low-quality IPs flood the market, it may trigger a "lemon market" effect (where you do not know the quality of the IP, leading to information asymmetry, and players may not be willing to pay high prices for IP).
However, in terms of narrative, Story Protocol may satisfy the following two points:
For Individuals: Any creator can publish IP like tweeting and capture the full lifecycle value;
For AI: Become the "HTTP protocol" for IP transactions between Agents.
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