⚡ InferPay — Pay-per-Inference AI Agent on Arc (Ollama Edition)

Hackathon: Stablecoin Commerce Stack Challenge — Track 4: Agentic Economy Free local AI (Ollama + Llama 3) · Circle USDC · Arc L1 Testnet

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What is InferPay?

An AI agent that charges $0.01 USDC per query, deducted from a Circle wallet and settled on the Arc blockchain in real time. The AI runs completely free and locally via Ollama — no OpenAI or Anthropic account needed.

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Quick Start (3 steps)

1. Install Ollama + pull model

# Install Ollama: https://ollama.com/download
# Then:
ollama serve           # start Ollama (keep this running)
ollama pull llama3     # download Llama 3 (~4GB, one-time)

2. Install & configure the app

git clone https://github.com/yourusername/inferpay
cd inferpay
npm install
cp .env.example .env.local
# Fill in CIRCLE_API_KEY, AGENT_WALLET_ID, AGENT_WALLET_ADDRESS

3. Run

npm run dev
# Open http://localhost:3000

That's it. No AI API key needed.

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Architecture

User → Next.js Frontend
     → POST /api/infer
       → Circle Wallets (charge $0.01 USDC on Arc)
       → InferPayAgent.sol (record payment on-chain)
       → Ollama local API (run Llama 3 inference — FREE)
     → Response + tx receipt → UI

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Environment Variables

Variable	Required	Description
CIRCLE_API_KEY	✅	From console.circle.com
CIRCLE_BASE_URL	✅	https://api-sandbox.circle.com
CIRCLE_WALLET_SET_ID	✅	From Circle console
AGENT_WALLET_ID	✅	Treasury wallet ID
AGENT_WALLET_ADDRESS	✅	Treasury wallet address
OLLAMA_BASE_URL	optional	Default: http://localhost:11434
OLLAMA_MODEL	optional	Default: llama3
COST_PER_INFERENCE_USDC	optional	Default: 0.01

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Supported Ollama Models

Any model you pull with ollama pull <name> works. Recommended:

Model	Size	Speed	Quality
llama3	4.7GB	Fast	Great
llama3:8b	4.7GB	Fast	Great
llama3:70b	40GB	Slow	Excellent
mistral	4.1GB	Fast	Good
phi3	2.3GB	Very fast	Good

Change model in .env.local: OLLAMA_MODEL=mistral

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Circle Products Used

• ✅ USDC — primary payment rail for per-inference charges
• ✅ Circle Wallets — developer-controlled wallets on Arc
• ✅ Circle Gateway — treasury routing
• ✅ Nanopayments — sub-cent high-frequency payment pattern

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Project Structure

inferpay/
├── app/
│   ├── api/
│   │   ├── infer/route.js         ← paid inference endpoint
│   │   ├── wallet/route.js        ← wallet create/balance
│   │   ├── transactions/route.js  ← tx history
│   │   └── health/route.js        ← Ollama health check
│   ├── dashboard/page.jsx         ← full UI with Ollama status
│   └── layout.jsx / page.jsx
├── lib/
│   ├── agent.js                   ← orchestrates payment + Ollama
│   ├── ollama.js                  ← Ollama API client
│   └── circle.js                  ← Circle API client
├── contracts/
│   └── InferPayAgent.sol          ← Arc smart contract
└── scripts/deploy.js

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Deploy Smart Contract on Arc

# Add to .env.local:
# DEPLOYER_PRIVATE_KEY=...
# ARC_USDC_ADDRESS=...

npm install --save-dev @nomicfoundation/hardhat-toolbox
npx hardhat run scripts/deploy.js --network arc_testnet

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Circle Product Feedback

Why we chose these products

• Circle Wallets on Arc — dollar-denominated gas makes $0.01 micropayments viable. ETH gas volatility would make sub-cent pricing unpredictable.
• USDC — stable, predictable unit of account for metered AI billing.
• Nanopayments pattern — exactly right for agentic pay-per-use workloads.

What worked well

• Sandbox faucet (/v1/faucet/drips) made testnet onboarding instant
• Arc's predictable fees are a genuine DX improvement over EVM chains
• Developer-controlled wallets abstract key management complexity

What could be improved

• Native webhooks for transfer state changes would reduce polling
• Clearer docs on Arc testnet USDC contract addresses
• A Circle CLI (like Stripe CLI) for local webhook forwarding

Recommendations

• Gas abstraction / sponsored transactions for USDC transfers
• A dedicated "agent wallet" tier with built-in rate limits and spending caps

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License

MIT — built for the Stablecoin Commerce Stack Challenge hackathon.