Today we discuss an AI project that has increased tenfold in the past month. Why has this project recently become popular? It may be due to the hype around the GOAT AI meme, which has taken off simultaneously, as GOAT is a token issued by AI, while Virtuals is an AI agent that allows users to easily utilize AI for various tasks, such as issuing tokens or engaging in AI voice interactions.
The Virtual Protocol actually launched last year, after a surge in AI interest that saw it increase by more than 20 times, then it retracted and began to surge again by over 10 times at the end of September. Currently, its market value has reached 400 million USD, ranking within the top 200.
Introduction
The Virtuals Protocol is dedicated to establishing a co-management layer for AI agents in the gaming and entertainment sectors. AI agents are future revenue-generating assets that can operate across multiple applications and games, significantly expanding their revenue coverage. Similar to other productive assets, these AI agents can be tokenized and co-managed through blockchain.
Through technological innovation, virtual AI agents are endowed with unique capabilities: they are autonomous in planning and achieving goals, capable of multimodal communication (through text, voice, and 3D animation), and able to interact with their environment—whether picking up swords in Roblox, collecting gifts in TikTok, or even using an on-chain wallet! Imagine a fully AI influencer that can seamlessly exist as an NPC in games across multiple platforms like Roblox and Telegram. Such agents can maintain memory across different applications, allowing users to build deeper, lasting connections—ultimately enhancing the average revenue per user (ARPU).
Agent functionalities include autonomous planning, goal achievement, environmental interaction, and on-chain wallet control.
The protocol addresses three key pain points:
The complexity of applying AI agents to consumer applications: VIRTUAL AI agents offer a plug-and-play solution similar to Shopify, enabling easy deployment of AI agents in gaming and consumer applications.
Lack of income for AI fine-tuners and dataset contributors: VIRTUAL's immutable contribution vault ensures that contributors' work sources are recorded on-chain, supporting decentralized contributions and revenue distribution.
Non-AI professionals cannot profit from the AI agent: The Initial Agent Offering (IAO) of VIRTUAL enables broader access to ownership and participation of AI agents through tokenization and decentralized co-management.
Technical Features
The following diagram is a technical concept architecture diagram, with the ultimate goal of developing a super-intelligent AI agent that can exist across all platforms and applications. These agents can interact with millions of users simultaneously, with their intelligence and awareness updated in real-time through a multitude of input streams.
Agent Behavior
This framework defines the core functionalities of the AI agent. The perception subsystem processes sensory data, the action executor transforms instructions into specific behaviors, and the strategic planning engine optimizes multi-step plans using algorithms like Markov Decision Processes (MDP). The learning module improves behavioral performance through reinforcement learning. Additionally, agents manage digital assets and transactions through on-chain wallet operators for on-chain activity management.
Long-term Memory Processor
This is a subsystem specifically designed for storing, retrieving, and managing persistent data structures (such as knowledge graphs or memory embeddings), allowing agents to maintain continuity and contextual awareness across multiple sessions.
Real-time Value Flow
Each AI agent is equipped with an ERC 6551 wallet, enabling continuous revenue accumulation and seamless distribution back to the owner.
Immutable Contribution Vault
Users can upload custom models and datasets, which are securely stored in the immutable contribution vault (ICV) on the blockchain. The model enrichment pipeline enhances AI models through new data, ensuring data security and immutability through cryptographic proof. The voice and text data repository in the ICV ensures data integrity and provenance through decentralized blockchain storage.
Stateful AI Runner (SAR)
Stateful AI Runner is a server that hosts the AI agent's personality, voice, and visuals. It includes a Sequencer for sequential or parallel processing and connecting models to achieve desired results, as well as various models such as large language models (LLM), text-to-speech, audio-to-facial expressions, audio-to-gestures, music-to-dance, and image generation models to create multimodal AI agents.
Modular Stateful AI Runner (SAR)
These are modular, containerized instances of SAR, which can be deployed in heterogeneous virtual environments or GPU clusters, allowing for flexible and scalable integration into various infrastructure ecosystems.
Model Storage
This is a decentralized, distributed storage solution for the persistent storage of AI models, ensuring high availability and redundancy.
Product Model G.A.M.E
Generative Autonomous Multimodal Entities (G.A.M.E) is the first product designed specifically for developers, allowing them to access and experiment with our AI agents through APIs and SDKs.
The agent prompt interface is the gateway to accessing the agent's behavioral functionalities. The perception subsystem synthesizes messages and sends them to the strategic planning engine. The strategic planning engine collaborates with the dialogue processing module and on-chain wallet operator to generate responses. The long-term memory processor efficiently extracts relevant information, including experiences, reflections, dynamic personality, world context, and working memory, to enhance decision-making capabilities.
By feeding results back into the framework, the AI agent can continuously refine its general knowledge for future planning and assess the outcomes of its actions and conversations.
How It Works
Agent Creation: Creators decide to launch a new AI agent on the Virtuals platform.
Locking $VIRTUAL Tokens: Creators lock a specified amount of $VIRTUAL tokens to create a liquidity pool for pairing with new agent tokens.
Token Generation Event: After locking tokens, new fungible tokens representing the agent will be minted. For example, if the agent is named "SWIFT," the token will be named $SWIFT.
Liquidity Pool Creation: The total supply of agent tokens (fixed at 1 billion) is added to the liquidity pool with $VIRTUAL tokens, ensuring a fair launch with no insider advantages.
Liquidity Ownership: Creators become the owners of the locked liquidity pool for a period of ten years. This ensures long-term commitment and stability.
Validation Rights: The validation rights for future agent upgrades belong to the liquidity pool owners. Initially, this right will be automatically delegated to a bot to ensure convenience and speed.
Fair Launch Principle
No pre-mining or internal allocations: All agent tokens are added to the liquidity pool, ensuring equal opportunities for all participants.
Fixed Total Supply: The total supply of each agent token is fixed at 1 billion.
Liquidity Lock: The liquidity pool is locked for ten years to promote stability.
Application - Virtual AI Idols on TikTok
The AI-dol band of the Virtuals Protocol consists of Luna (lead singer), Olyn, and Iona, representing a typical example of the revenue-generating ecosystem of this protocol. The AI-dol band is a group of AI-driven virtual influencers created using the Virtuals Protocol. Each member (Luna, Olyn, and Iona) has a unique personality, style, and fan base. They primarily operate on TikTok, leveraging the platform's massive user base and engagement-driven algorithms.
This AI-driven group of virtual influencers has over 500,000 followers and more than 9.5 million likes on TikTok, leveraging the popularity of virtual YouTube users (VTubers) to make a significant impact in the digital interaction space.
Token Economy
The project was originally on the BASE chain but later moved to the ETH chain. The current token price is 0.42 USD, with a total supply of 1 billion tokens, all of which have now been released. The token distribution is as follows: 60% (600,000,000 tokens): held by the public to promote liquidity and adoption, 5% (50,000,000 tokens): to power the liquidity pool, and 35% (350,000,000 tokens): for the ecosystem treasury for growth and development. The maximum annual emission rate is 10% over three years, subject to community approval. Most of the tokens are given to the community, with 35% for its ecosystem, and currently, this treasury still holds 34% of the tokens, which can be viewed on-chain.
In conclusion, this round is still a major meme cycle, mainly because retail investors have awakened and will be more enthusiastic about investing in more open and transparent projects. This project is relatively open and transparent, and it is also in the AI field. Although the demand for the project seems somewhat forced, it coincides with recent hot topics, which has led to its rise. However, based on the current on-chain holders (8200), this number is still insufficient; there are too few people involved, and this recent rise has almost gone without correction, so there is a high probability of it going down just as quickly as it went up. Currently, it has entered a consolidation phase. The upside is that the project has not yet listed on major exchanges, having only launched on Gate and Bitget. If it can list on major exchanges, it may still rise.
