Token Truce Aims to Rebuild Trust in AI-Crypto Alliances

The long-standing dispute between Fetch.ai and Ocean Protocol over 286 million FET tokens—valued at approximately $120 million—has shown signs of resolution, with both parties expressing willingness to settle during recent community discussions, according to an Ambcrypto report. Fetch.ai has proposed returning the tokens to avoid legal battles, while Ocean Protocol has indicated readiness to comply if a formal proposal is submitted, potentially alleviating supply overhang concerns and stabilizing FET prices.

The conflict, which began after the collapse of the Artificial Superintelligence (ASI) alliance in October 2024, centers on allegations that Ocean Protocol converted 661 million OCEAN tokens into FET and transferred portions to centralized exchanges like Binance and GSR Markets, as described in a Lookonchain post. Fetch.ai CEO Humayun Sheikh accused Ocean Protocol of undermining the alliance's integrity, while Ocean Protocol founder Bruce Pon denied misconduct, attributing the FET price drop to broader market volatility and liquidity issues, as outlined in a Coinotag article. Blockchain analytics from platforms like Bubblemaps confirmed the token conversions, fueling accusations of potential market manipulation, and further reporting on the on-chain flows appeared in a Coinotag piece.

FET's price has plummeted over 93% since the ASI merger, trading near $0.26—a level that technical indicators suggest is deeply oversold, with a Relative Strength Index (RSI) of 27—details reported by Cointelegraph. The token's decline has been exacerbated by fears of sell-pressure, with the disputed 286 million FET tokens representing a significant supply overhang. Analysts note that resolving the dispute could restore investor confidence, though uncertainties remain about post-return token management, including lockup terms and treasury governance.

Recent developments have shifted the tone from adversarial to collaborative. During a public X Space event, Sheikh stated Fetch.ai would drop all legal claims if Ocean Protocol returned the tokens, a move covered in a Coinotag report, with additional coverage noting Fetch.ai even offered to cover legal costs to expedite the process in another Coinotag article. Ocean Protocol, via mediator GeoStaking, signaled openness to compliance but emphasized the need for a formal written agreement—a development summarized in a CoinEdition piece. This conditional progress has sparked cautious optimism, with FET rising over 3% following the news, though traders remain hesitant without clarity on execution details.

The resolution hinges on finalizing terms that ensure transparency and prevent future disputes. Experts highlight that a structured token return with vesting schedules could mitigate sell-pressure risks and rebuild trust in the AI-crypto ecosystem. The outcome also carries broader implications for decentralized projects, underscoring the need for robust governance frameworks in token alliances.

If finalized, the agreement could mark a turning point for both projects. Fetch.ai aims to refocus on AI innovation, while Ocean Protocol seeks to restore credibility after its controversial exit from the ASI alliance. However, delays or ambiguities in the settlement could prolong market uncertainty, with FET's recovery dependent on sustained transparency and adherence to agreed terms.