AI Agent: DeFAI Could Become the Second Rise Curve

At the beginning of the year, blockchain AI agent projects emerged like mushrooms after rain. Representative projects Virtuals and ai16z once reached market values of $5 billion and $2.5 billion, respectively, with underlying frameworks like ARC and Swarms exceeding $600 million. DeFAI projects such as BUZZ and Grift touched $200 million. Web2 AI agent projects like Pippin and AIOS also ventured into the crypto space. Everyone is looking forward to the beautiful vision of the "AI Agent Revolution" and the "DeFAI Spring."

However, with the sudden change in market trends, the liquidity of AI agent tokens rapidly dried up. The emergence of DeepSeek further burst the AI bubble. The market capitalizations of Virtuals and ai16z fell below $1 billion and $500 million, respectively, while other AI agent tokens generally dropped by over 90%. The AI agent sector has entered a harsh winter, leaving behind a difficult reality and deeply trapped investors.

Given that the overall scale of the AI agent sector is not large, at less than $7 billion, many people have limited understanding of it. This article will first overview the AI agent sector, and then explain why DeFAI is expected to become a new rise point for AI agents, potentially bringing opportunities worth billions of dollars.

Overview of AI Agent Module

AI agents are intelligent entities capable of autonomous action, task execution, and interaction with external tools. At their core are model services primarily provided by ChatGPT, Anthropic, Gemini, and others. AI agents are not only conversational large language models but also need to manage their own states, invoke various tools, and execute safely.

AI agent projects in the Web3 field mainly include launch platforms, frameworks, infrastructure, agents, and DeFAI.

( Launch Platform

Launch platforms are currently the type of project where AI agents can capture value most easily. They allow users to create, deploy, and monetize AI agents, similar to the launch platforms of Meme coins.

Virtuals is currently the largest launch platform, having issued over 100,000 AI agents on the Base network. Its ecosystem has given birth to several well-known projects such as the virtual streamer Luna, "crypto KOL" AIXBT, and the development framework G.A.M.E.

The Virtuals team was originally established in 2021, with its predecessor being the gaming guild PathDAO. After the release of GPT in 2023, the team recognized the importance of AI and began to shift towards the AI field.

![DeFAI: The Second Curve of AI Agent])https://img-cdn.gateio.im/webp-social/moments-1a7a3e073ca15e132ad35accdfa0bbb3.webp###

( framework

Framework is a toolkit for developing AI agents. A certain public chain officially listed 5 main framework projects: SolanaAgentKit, Eliza, Rig, GOAT, and ZerePy.

ai16z is currently the second highest market cap AI agent project. In addition to the Eliza framework, it is also a venture capital fund in the AI track, and it plans to develop into a public chain for AI agents in the future.

ai16z was founded by @shawmakesmagic on a certain platform. Its core concept is to use AI models to simulate the investment decisions of well-known venture capitalists and their co-founders, combined with community suggestions for investments. This innovative model aims to integrate AI trading strategies with decentralized governance to enhance investment transparency and credibility.

![DeFAI: The Second Curve of AI Agent])https://img-cdn.gateio.im/webp-social/moments-6c244584069318f83da30e88d8b9df19.webp###

( infrastructure

Infrastructure refers to the off-chain platforms or tools built around AI agents, covering a wide range of services, including data aggregation services, testing platforms, resource sharing networks, model fine-tuning services, and dedicated public blockchains.

A data aggregation platform tracks over 1000 AI agents, building an index and data layer to support multi-dimensional comparisons such as mind share and intelligent attention.

A certain testing platform is dedicated to creating a decentralized environment for enterprises to test AI models and agents in a distributed setting, aiming to enhance the practical application safety of AI models.

A certain resource-sharing network uses a unified decentralized protocol to connect the agents of each framework. Its core is the P2P resource-sharing protocol, which enables secure functional sharing among agents.

A certain AI model development team focuses on customizing models for specific ecosystems, assisting in completing a wide range of tasks such as market analysis and risk assessment.

A certain public chain is the first high-performance platform to support full-chain AI, featuring elastic block space, parallel execution, and a modular architecture, which provides strong verifiability and scalability for AI behaviors.

![DeFAI: The Second Curve of AI Agent])https://img-cdn.gateio.im/webp-social/moments-17e67c91715dbc4b22d7b676397de108.webp###

( Intelligent Body

Intelligent agents refer to specific AI agents, and most AI agent projects on the blockchain belong to this category. In addition to the previously mentioned AIXBT and Luna, there are several other distinctive intelligent agents worth paying attention to.

Freysa is a competitive proxy game consisting of agents that control a prize pool. The objective of the game is to persuade it to send the prize pool to the player. Anyone can send messages to Freysa by paying a query fee.

A certain intelligent agent focuses on artistic creation and content generation, capable of independently creating music, memes, artworks, and NFTs. Its team has also developed a Python-based AI agent framework.

Another intelligent agent was initially an abstract concept published by a well-known AGI framework author on a social platform, which later developed into an actual AI agent project. The author also launched a framework for creating "self-feedback" mechanism agents.

![DeFAI: The Second Curve of AI Agent])https://img-cdn.gateio.im/webp-social/moments-51e3271da1cde985351552d3e7c86dc5.webp###

( DeFAI

DeFAI is a combination of decentralized finance and artificial intelligence, aimed at simplifying the complex processes of DeFi through AI technology, allowing ordinary users to easily use DeFi services. This is currently the most likely application area for the implementation of AI agents combined with blockchain.

A certain project is an intention-based blockchain terminal that simplifies the complexity of on-chain transactions through agent technology. It also supports users in creating their own agents to complete various social interactions and DeFi transactions.

Another platform focuses on simplifying DeFi operations and obtaining market information, providing users with a smooth interaction experience. Its features are comprehensive, developed by a well-known team, and supported by multiple parties.

There is also a project that utilizes AI technology to provide a natural language interface, allowing users to conduct and manage DeFi transactions more intuitively. It is based on a specific architecture and toolkit, enabling the automatic handling of various DeFi operations through user commands and supporting customized strategies.

![DeFAI: The Second Curve of AI Agent])https://img-cdn.gateio.im/webp-social/moments-c7890f659074d2902384a8956721c01c.webp###

The Potential of DeFAI

The development of AI agents is far from over; it just needs practical applications to draw the second rise curve. Currently, DeFAI seems to have the most potential.

AI agents still have room for rise, mainly based on two points:

1. From a macro perspective, the future will inevitably be a world of AI, and the integration of Web3 and AI is unavoidable. AI improving Web3 is the most direct way, with higher certainty than Web3 improving AI. Currently, the biggest issue with Web3 is the high user threshold, and AI agents can guide users throughout the process, assist in managing transactions, answer questions, and perform complex operations.

2. From a market perspective, the abrupt halt of AI agent narratives is more due to the "trust crisis" triggered by celebrity Meme coins. The issuance of coins by various celebrities has turned the on-chain environment into a purely zero-sum game, and AI agents, as utility tokens, have also been misjudged by the market.

Therefore, it is necessary to apply changes that allow users to truly experience the improvements AI brings to Web3, and to make the market recognize that AI agents are different from Meme coins. DeFAI is precisely the new narrative direction and second rise curve for AI agents.

AI agent narratives are actually just getting started, with a maximum market value of only $13 billion, primarily focused on launch platforms and frameworks. For infrastructure, agents, and DeFAI, many high-quality projects are still in development and have not yet been fully understood and recognized by users.

Infrastructure struggles to take center stage; the strong Meme attributes of agents make it difficult for tokens to empower; however, DeFAI can help users lower the DeFi threshold, aligning with the direction of AI improving Web3, and the tokens are easier to empower, such as through token payments or staking to unlock advanced features.

In the first rise curve, the AI agent framework acts as a glue, but the framework itself is difficult to capture value. In contrast, DeFAI is the application that captures value most easily, and it is a trend that the AI agent framework supports DeFAI. In the future, new frameworks specifically supporting DeFAI applications may emerge.

Conclusion

The summer of DeFi in 2020 drove a significant rise in the crypto market, and DeFi remains the largest application layer innovation and popular entrepreneurial direction in Web3 to this day. While we look forward to new application layer innovations in Web3, we often overlook the leapfrog development achieved by DeFi with the power of AI.

DeFAI not only simplifies DeFi operations and enhances user experience, but also stands at the intersection of DeFi and AI agents. It can promote the popularization of DeFi while providing practical scenarios for AI agents, helping them move from concept to application.

In times of market turmoil, it is particularly important to adhere to pragmatic principles. Believe in the value of DeFAI, and trust that practical applications will ultimately bring true prosperity to Web3.