Training AI Models Without a Billion-Dollar Data Center | Steffen Cruz of Macrocosmos

Training a frontier AI model today requires hundreds of thousands of GPUs, months of compute time, and a budget that only a handful of companies on earth can afford. Steffen Cruz, co-founder and CTO of Macrocosmos, thinks that model is about to break, and he's spending his time building what comes next. His project IOTA, operating within the BitTensor blockchain ecosystem, uses distributed training to split large language models across thousands of devices located around the world, coordinated by blockchain, and powered by surplus cheap energy wherever it exists. After nine months of research, the system can reproduce baseline benchmark performance using what Cruz calls "wonky vegetables" - unreliable, churning, globally distributed compute - and turn it into something indistinguishable from centralized training if you use the right approach.

The conversation with Craig Smith covers the mechanics of how this actually works, why the blockchain's role is far narrower and more practical than most people assume, and why the Mac mini stockpiling trend creates an unexpected supply of distributed compute that can earn passive income when idle. Cruz's target: a 70 billion parameter model by mid-2025, trained at 10-20% of what it would cost through a hyperscaler, and aimed squarely at the legal firms, hospitals, and cash-strapped startups that have been waiting to train their own sovereign models but couldn't afford the price tag.

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