In a dramatic twist in the crypto world, the market witnessed an intense clash between two tokens bearing the same name—ELIZA—as they vied for control amid a frenzy of trading.

While artificial intelligence (AI) might one day become humanity’s biggest challenge, for now, it’s driving massive profits in the crypto world. The latest project, ai16z—a crypto initiative named as a playful nod to the prominent venture firm Andreessen Horowitz—found itself in the midst of an unexpected drama this week. The team behind the project had planned to launch a new token tied to their AI initiative, ELIZA, but their announcement was overshadowed by another ELIZA token hitting the market first.

The chaotic situation unfolded as a crypto trader frenzy broke out, with two competing ELIZA tokens—one from the fans of ai16z and another from the ai16z creators themselves—battling for supremacy.

The first ELIZA token, created by a group of ai16z supporters, saw its market cap plummet from $40 million to just $6 million within minutes, as a wave of selling took hold. Meanwhile, the newly launched ELIZA token from the ai16z project itself soared to a market cap of $100 million.

This abrupt price movement left many traders with heavy losses, as the memecoin-like token with branding borrowed from ai16z became a battleground. “We had a plan, a vision, and then we were completely blindsided by the mascot character of our own brand being front-run,” Shaw, the pseudonymous founder of ai16z, said in an impassioned post on social media platform X.

The mascot in question is Eliza, an open-source AI framework designed to facilitate human-like interaction with social media users. In an attempt to rectify the situation, Shaw “set her free” and officially backed the new ELIZA token, while pledging that a portion of the funds raised would be directed to ai16z‘s treasury.

Shaw addressed the turmoil in a public post, offering a “bailout” for early holders of the original token, promising them 10% of the new token as compensation for their losses. However, Shaw made it clear that the new ELIZA token was crucial for establishing a distinct identity for the project, independent from ai16z. The goal was to create a long-term asset that could evolve on its own, growing beyond the scope of the original project and weaving its own narrative.

Ai16z has been positioning itself as a groundbreaking player in the AI-driven crypto market, presenting itself as a venture fund fully managed by AI, with the ambitious goal of “flipping” the Andreessen Horowitz brand. Its token, with a market cap exceeding $300 million, allows holders to interact with the project’s AI leader, “Marc AIndresseen.”

Shaw emphasized that the new ELIZA token was not an official ai16z project but rather the product of an undisclosed partner working in collaboration with the ai16z team. Despite the market chaos, Shaw remained optimistic about the future of the new ELIZA token and its potential to chart its own course in the world of AI and crypto.