Meet Modelz: Turning Open-Source Models into On-Chain Economies

May 27, 2025

1. The Problem: Big Tech Owns the Cash Register


Open-source AI is set to win the AI war yet the money still funnels to the cloud giants that host and gate those models behind pricey APIs.

Creators are left with GitHub stars, users pay through invisible mark-ups, and nobody shares in the upside except the hyperscalers.


2. The Modelz Solution: Every Model Becomes a Mini-Startup


Modelz puts each open-source model on-chain as a MODEL token—a bit like giving every model its own economy:

Result: when usage grows, the value flows back to builders and token holders.


3. How It Works in Three Simple Loops


MODELZ introduces a three-loop system to fund, monetize, and evolve AI models: initial model offerings (IMO) seed treasuries and reward developers, revenue-sharing aligns ongoing incentives through PACA payments, and governance enables token holders to fund upgrades that keep models competitive. This on-chain ecosystem ensures transparency, sustainability, and community-driven improvement.


Loop 1 — Initial Model Offering (IMO)


Goal: seed the treasury & reward the devs.

  1. Creator tokenizes an AI model on MODELZ

  2. Anyone with PACA can buy a portion of the specific [MODEL] tokens (bonding curve or fixed-price).

  3. Proceeds fill the model treasury; a preset slice of tokens goes straight to the original authors.


Loop 2 — Revenue Share


Goal: align long-term incentives.

  1. Agents or builders call the model via the MODELZ API (Q1 2026 - AGENT Layer).

  2. They pay in PACA (the Alpaca Network gas token).

  3. Smart contracts split the fee: X% to token stakers, Y % to dev wallet, Z % to compute provider. All that all on-chain, no middlemen. The exact percentages will be voted on in the coming months as the first models are offered with inference.


Loop 3 — Governance & Upgrades


Goal: keep the model competitive.

  1. Treasury funds are surfaced as proposals (fine-tuning, bigger context window, exclusive weights).

  2. [MODEL] token holders vote.

  3. If passed, funds auto-stream to the implementer.

  4. Better model → more usage → higher revenue → happier holders. Flywheel spins.


4. Concretely—What’s in It for You?


MODELZ creates a new incentive layer for AI by rewarding different participants: developers earn upfront and ongoing royalties, builders can offset API costs through staking, and investors gain exposure to model adoption without needing technical expertise. Meanwhile, DAOs and communities get real governance power over model direction and licensing, shifting control away from centralized tech giants.


5. Example: DeepSeek-LLM as a MODEL Token


Currently, open-source models like DeepSeek offer free demos but rely on closed, costly APIs and earn nothing from public use. With MODELZ, anyone can access public endpoints while premium calls generate revenue split between stakers, devs, and the community—turning model usage into a shared investment opportunity.


6. Roadmap to Launch


The MODELZ roadmap kicks off with community engagement and voting, leading to the July 10 mainnet launch featuring Initial Model Offerings, staking, and the Agent Layer. By early 2026, the platform will expand with full smart contract integration, enhanced governance, and decentralized inference rewards.


Big-Tech margins are yesterday’s business model.


With Modelz, every open-source model becomes a community-owned revenue stream —and anyone can grab a seat at the table.


See you on-chain on July 10th - sign up to test the Beta here.

Own the Future of AI: How Alpaca Network Turns Open-Source Models into Investable, Usable Assets ›