Crypto Partnership Instability Exposed in $120M AI Collaboration Agreement

Ocean Protocol and Fetch.ai Reach $120 Million Settlement

After a heated legal dispute, Ocean Protocol and Fetch.ai have come to terms, agreeing to return $120 million in

tokens. This agreement prevents a lengthy legal confrontation and enables both organizations to shift their attention back to advancing decentralized AI and Web3 projects. Multiple sources, such as , have verified the settlement, which follows several months of public disagreements over token handling and liquidity, culminating in Fetch.ai CEO Humayun Sheikh threatening legal proceedings. As outlined in the deal, Ocean Protocol will transfer 286 million FET tokens—currently valued at about $120 million—back to Fetch.ai, which in turn will withdraw all outstanding legal claims, reported.

The conflict originated from the 2024 merger between Ocean Protocol, Fetch.ai, and SingularityNET, forming the Artificial Superintelligence (ASI) Alliance—a group dedicated to integrating AI-powered blockchain initiatives under a unified token system,

reported. According to blockchain analytics firm , Ocean Protocol’s multisig wallet swapped 661 million OCEAN tokens for 286 million FET, with 160 million FET later sent to Binance and 109 million to OTC provider GSR Markets, reported. Sheikh claimed this was a secret sale of FET tokens that disrupted the market and negatively impacted holders. Ocean Protocol refuted these accusations, labeling them as baseless and attributing FET’s 93% price drop since the merger to overall market instability and liquidity issues from other alliance members, Cointelegraph reported.

This agreement represents a significant shift for both entities. Fetch.ai’s CEO highlighted that the deal prioritizes “community protection,” while Ocean Protocol’s founder, Bruce Pon, described leaving the ASI Alliance as essential for maintaining ethical standards. “Ocean could not remain part of the ASI Alliance in good conscience,” Pon remarked, promising to release a detailed response to the recent claims, Cointelegraph reported. The settlement also stipulates that Sheikh will pay the legal fees related to token recovery, which should speed up the process, according to Coinpedia.

The dispute had already caused considerable market turbulence. FET’s value dropped sharply from $3.22 to $0.26, with experts attributing the fall to diminishing confidence in decentralized governance,

found. Ocean Protocol’s exit from the ASI Alliance in October 2025 further fueled uncertainty, though the project has since initiated a buyback plan and is working to get relisted on major exchanges to restore liquidity, reported.

Now that the conflict is resolved, both organizations are looking to refocus on technological progress. Fetch.ai and Ocean Protocol have expressed intentions to renew their partnership in decentralized AI, though the future of the ASI Alliance is still unclear. This episode highlights how fragile crypto collaborations can be, emphasizing the importance of transparency and sound governance to maintain trust among stakeholders,

Protocol observed.