Are AI tokens the new signing bonus or just a business cost?

This week, a topic that has been circulating around Silicon Valley finally gained widespread attention: offering AI tokens as part of compensation. The concept is simple — instead of paying engineers with only salary, equity, and bonuses, companies would also provide them with a pool of AI tokens, the computational units that power tools like Claude, ChatGPT, and Gemini. Engineers can use these tokens to run agents, automate tasks, and push through code. The argument is that more compute access makes engineers more productive, and more productive engineers are inherently more valuable. In essence, it’s an investment in the person holding the tokens.

Jensen Huang, Nvidia's leather-jacket-clad CEO, seemed to capture everyone’s imagination when he floated the idea at the company’s annual GTC event earlier this week. He suggested engineers should receive roughly half their base salary again — in tokens. By his math, his top people might burn through $250,000 a year in AI compute. He called it a recruiting tool and predicted it would become standard across Silicon Valley.

It isn’t entirely clear where the idea first originated. Tomasz Tunguz, a prominent Bay Area venture capitalist who runs Theory Ventures and focuses on AI, data, and SaaS startups — and whose data-oriented writing has built a loyal following over the years — was discussing this in mid-February. He wrote that tech startups were already adding inference costs as a “fourth component to engineering compensation.” Using data from compensation tracking site Levels.fyi, he pegged a top-quartile software engineer salary at $375,000. Adding $100,000 in tokens brings the fully loaded cost to $475,000 — meaning roughly one dollar in five now goes to compute.

That’s no coincidence. Agentic AI has been gaining momentum, and the release of OpenClaw in late January accelerated the conversation considerably. OpenClaw is an open-source AI assistant designed to run continuously — churning through tasks, spawning sub-agents, and working through a to-do list while its user sleeps. It’s part of a broader shift toward “agentic” AI, meaning systems that don’t just respond to prompts but autonomously take sequences of actions over time.

The practical consequence is a massive surge in token consumption. Where someone writing an essay might use 10,000 tokens in an afternoon, an engineer running a swarm of agents can blow through millions in a day — automatically, in the background, without typing a word.

By this weekend, the New York Times had assembled a sharp look at the so-called tokenmaxxing trend, finding that engineers at companies including Meta and OpenAI are competing on internal leaderboards that track token consumption. The paper reported that generous token budgets are quietly becoming a standard job perk, much like dental insurance or free lunch once was. One Ericsson engineer in Stockholm told the Times he probably spends more on Claude than he earns in salary, though his employer covers the cost.

Maybe tokens really will become the fourth pillar of engineering compensation. But engineers might want to pause before embracing this as a straightforward win. More tokens may mean more power in the short term, but given how fast things are evolving, it doesn’t necessarily translate into more job security. For one thing, a large token allotment comes with large expectations. If a company is effectively funding a second engineer’s worth of compute on your behalf, the implicit pressure is to produce at twice the rate — or more.

And there’s a muddier problem underneath that: when a company’s token spend per employee approaches or exceeds that employee’s salary, the financial logic of headcount starts to look different to the finance team. If the compute is doing the work, the question of how many humans need to coordinate it becomes harder to avoid.

Jamaal Glenn, an East Coast-based Stanford MBA and former VC turned financial services CFO, similarly points out that what may seem like a perk can be a clever way for companies to inflate the apparent value of a compensation package without increasing cash or equity — the things that actually compound for an employee over time. Your token budget doesn’t vest. It doesn’t appreciate. It doesn’t show up in your next offer negotiation the way base salary or equity does. If companies successfully normalize tokens as pay, they may find it easier to keep cash comp flat while pointing to a growing compute allowance as evidence of investment in their people.

That’s a good deal for the company. Whether it’s a good deal for the engineer depends on questions most engineers don’t yet have enough information to answer.