Super Intelligence Is Entering Its Third S-Curve. Here’s How to Profit.
SI will destroy and create major economic shifts. Let’s discuss the emerging investment opportunities.
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The market is under early pressure Wednesday with dismal breadth of just 26%. There is nothing going on with small stock speculation but the Mag 7 is still strong with Meta (META) and Microsoft (MSFT) leading. The energy sector is also green after oil reversed higher.
I’m not too surprised to see this after the roller-coaster rotational action over the last few days. As I discussed in my morning post, I’m not convinced we can escape the pull of negative seasonality.
I’m not planning to make any big moves right now but I want to take the time to discuss the “Super Intelligence” theme. I will be using that term now rather than AI. SI is no longer a new concept or a single monolithic idea. It is changing and evolving, and investment success will depend on identifying the key themes and the stocks that are executing on them best.
The selloff in the financial stocks Tuesday is a good illustration of how fast the SI environment can shift. Charles Schwab (SCHW) and LPL Financial (LPLA) each dropped more than 6% because of an app.
Meta Platforms (META) launched a personal AI agent called Muse, which topped the app store with more than 900,000 downloads in six days, and the market suddenly started pricing the possibility that agents like it could take business away from the firms whose profits depend on customers not shopping around.
On the same day the disrupted names fell, the disruptor was rewarded. Cantor Fitzgerald raised its Meta price target to $860 from $680, calling personal agents the third S-curve in AI and Meta a leading beneficiary. One product triggered two strong moves in opposite directions. That pairing is important, because it is an indication of how the SI trade is evolving and moving into a new phase.
What an S-Curve Is
The theory is that technology adopts along an S-curve. Development is slow at first while it is expensive and unproven, then explosive growth follows once it is proven and the price comes down. After that there is a plateau as the market saturates and competition dominates.
Big technology shifts like SI are not one S-curve but a series of them, each building on the last, and each creating a new set of winners while disrupting a different set of incumbents.
SI has moved through two of these curves already and is starting a third.
The first curve was infrastructure. The picks and shovels. Nvidia (NVDA), the chip makers, the data centers, the power demand buildout. This is the wave that has driven the market for two years, and it is where all the debate about capital spending and margins reside. The winners like Nvidia were obvious and enormous.
The second curve was the models themselves. The foundation layer, the large language models built by OpenAI, Anthropic, Google (GOOGL), and Meta. This is where the raw intelligence got built.
The third curve is just beginning and it is agents and applications. Software that acts on your behalf. Muse is the first mass-market example. This is where SI stops being something companies spend money on and becomes something that takes revenue away from established businesses. It is the disruption wave, and Tuesday was its first real shot across the market’s bow.
The Leaders of One Curve Are Rarely the Leaders of the Next
What matters most for investors is that each curve has its own winners, and the winners of one curve are usually not the winners of the next. Nvidia was the winner of an earlier S-curve but it is not likely to be the primary leader in the next.
We have seen this movie before. The internet had the exact same structure. The first curve was infrastructure, Cisco (CSCO), Sun Microsystems, Nortel, the companies that built the physical network. They led the market into 2000. The second curve was the portals and platforms. The third was the applications that actually disrupted incumbents, Amazon (AMZN) eating retail, the online travel sites eating the agencies, and later Netflix (NFLX) eating the video stores.
The lessons from that era are brutal and caused a lot of pain for the folks that didn’t understand the evolution. The infrastructure leaders that drove the 1998 to 2000 run mostly never saw their highs again. Cisco was the most valuable company in the world in 2000 and just recently surpassed prior highs more than 20 years later.
The lasting winners came from the application wave, and they were not obvious at the time because they were losing money and getting questioned. Amazon fell 90% in the 2000 to 2003 crash before it went on to define the next two decades.
The crash of 2000 to 2003 was not the end of the internet. It was the market violently re-sorting who the real winners would be. The theme was right and most of the specific stocks were wrong.
What This Means Now
If SI is entering its third curve, a few things follow.
Owning the SI infrastructure names is a bet on the first curve, and the first curve may be maturing. That does not mean those companies are bad, any more than the internet’s arrival made Cisco a bad company. It means the easy, obvious part of the trade, the part where you buy the picks and shovels and ride the buildout, is likely behind us.
The debate about whether the hyperscalers are overspending is itself a sign of a maturing curve. Data centers like Nebius (NBIS) look cheap on many metrics but the stocks have been struggling because of uncertainty about growth.
The action moves to the disruption wave, and that requires a completely different kind of analysis. Not who builds the SI, but whose business gets eaten by it. That is the question the market started asking Tuesday, and it is why Schwab fell.
Any business whose profit depends on customer inertia and friction, on people not shopping around, is now a candidate for repricing. Wealth management, brokerage, insurance, travel booking, anything where the incumbent’s edge is being the default rather than being the best.
I have written before that the entire business model of Wall Street is built on gathering assets and keeping them, on customer inertia worth billions. An SI agent that ends inertia is a direct threat to that model.
The Other Side of the Disruption Is New Demand
The third curve does not only destroy. It also creates, and BlackRock (BLK) laid out where in a research paper published this week called “The Machine-Native Economy.”
The argument is that once SI agents are transacting on their own, they need a payment system built for machines rather than people. An agent does not buy one $50 item. It makes thousands of tiny payments at high frequency, a fraction of a cent for a piece of data, an API call, a slice of computing power.
The traditional card and bank systems cannot handle that. The fixed cost of a card transaction makes a sub-cent payment uneconomic, and the identity checks and human authorizations that cards require defeat the entire purpose of an autonomous agent.
BlackRock’s framework is that SI is machine-native intelligence and crypto, specifically stablecoins, is machine-native money. Stablecoins settle instantly, run around the clock, cost almost nothing per transaction, and let software move value automatically under set permissions. That is exactly what an agent economy needs. Stablecoins already carry a market value over $300 billion and moved more than $11 trillion in 2025, roughly matching Visa’s (V) volume, so the scale is already there.
This is not just a thesis on paper. Circle (CRCL) launched a blockchain this month built explicitly for agent payments, with BlackRock, Mastercard (MA), and Visa as founding validators. Stripe and OpenAI built a protocol for agent commerce. The rails for the machine economy are being laid right now.
The interesting part is who is building them. BlackRock is one of the great asset gatherers, exactly the kind of firm an agent like Muse threatens. And here it is, positioning itself to profit from the same disruption that endangers its traditional business. That is the smart-money move, getting ahead of the curve rather than being run over by it, and it tells us the third curve is being taken seriously at the highest level of finance.
When the incumbents start trying to own the thing that threatens them, the threat is real.
Where the Opportunities Are
I am not selling my SI infrastructure exposure on this, and I am not rushing to buy the third-curve names either. What the framework changes is where I am looking. The opportunities from here are on two sides of the disruption wave.
The first is the disruptors, the companies whose agents get between the traditional company and its customers. Meta is the obvious one right now, but it will not be the only one, and the market is only beginning to price this.
The second, and the one fewer people are watching, is the new infrastructure that the agent economy requires. If BlackRock is right that machines need machine-native payment rails, the stablecoin and tokenization names are a play on the third curve that has nothing to do with picking which app wins.
You are not betting on Muse versus its competitors. You are betting that the agent economy needs rails, whoever builds the agents. I am working now on finding ways to play the stablecoin theme, with Circle the most obvious name.
The Lead Keeps Changing Hands, and That Is the Trade
There is another opportunity here, and it is the most tradeable of all because it involves the large names people already own.
The favored SI system keeps rotating. OpenAI was the clear leader, then Google’s Gemini caught and passed it on some measures, then Claude became the developer favorite, and now Muse has the consumer moment. Not one of those leads held for long. Each apparent king got answered within months, and the stocks moved with the story.
That is the nature of this phase. Unlike the first curve, where Nvidia simply kept winning because nobody else could make the chips, the model and agent layer has ferocious competition and lower barriers.
Muse has the spotlight today, and the other hyperscalers are going to come after it fast, because they have the distribution, the capital, and every reason not to hand over the agent layer without a fight. Google and Amazon and OpenAI are not going to watch Meta take the consumer agent and do nothing.
For a trader, that constant changing of the guard is the opportunity. Muse’s moment is a trade in Meta, but the history of this wave says the enthusiasm fades when the next competitor answers, and that sets up a trade in whoever was just written off.
Buying the reigning champion at the peak of the acclaim has been a good way to get hurt in this group. The better game has been to watch the rotation and trade the swings, the same thing I keep saying about the broader market. The leadership is unstable, and unstable leadership is a trader’s market, not a buy-and-hold one.
One name I have mentioned recently is Amazon, which is currently out of favor but I am looking for that to change.
Reasons to Be Cautious
The third curve is valid as a theme but it is treacherous as a set of specific stock picks, and this is exactly where the 2000 example is most useful.
Muse loses money right now. Cantor admitted the unit economics are subsidized and that Meta has several paths to profitability rather than a proven one. That is precisely what was true of every “pageview” application in 2000. Growth first, profits theoretical.
Some of those bets, like Amazon, paid off beyond anyone’s imagination. Many others, the ones nobody remembers, went to zero. And you could not reliably tell them apart from the adoption numbers, because the winners and the disasters both had explosive early growth.
So the S-curve framework tells you where to look, not what to buy. It says the next great winners and the next great disasters will come from the application wave, not the infrastructure wave, and that the sorting will be violent and take years. It does not tell you which is which. That is the problem, and it is the same issue that separated the Amazons from the Pets.coms a generation ago.
My observations here are a bit theoretical and predictive but the framework for how Super Intelligence is developing is clear. Our job now is to pick the right stocks at the right time. I’ll be exploring various names in future columns.
At the time of publication, Rev Shark was long AMZN.
