Six months ago, most Crypto AI projects on the market were still concepts related to AI + DePIN, computing power leasing, etc., but now, Crypto AI projects have moved to a different style. From the AI Bot token GOAT, which surged to a market cap of $800 million without Binance's involvement, to last weekend's launch of AI 16 Z's AI investment DAO model, AI seems to have opened a new frontier in the crypto space.
However, the simple narrative of 'AI issuing memes' seems inadequate to sustain the vast imaginative space required by investors. Therefore, the evolution from AI meme to the current AI Agent boom indicates that the narrative and main battleground of AI + Crypto are rapidly advancing, leaving those who cannot understand the AI meme trend behind.
From AI meme to AI Agent, the lightning-speed evolution of the AI + Crypto narrative.
In March this year, Virtual Protocol launched with the goal of creating an AI factory for games and the metaverse, making games smarter and enhancing experience and interaction. In this narrative shift from AI meme to AI Agent, Virtual Protocol is undoubtedly the biggest beneficiary, with its native token VIRTUAL increasing more than fourfold in about a week, nearing a market cap of $500 million.
A fourfold increase in a week, precisely riding the wave of AI Agents: Virtual Protocol.
In mid-October this year, Virtual Protocol's token issuance platform IAO officially launched, allowing users to easily deploy AI Agents and achieve 100% fair launch AI Agent tokens while enabling users to co-own the income generated by the AI Agents. Subsequently, VIRTUAL began its upward trajectory.
An AI Agent refers to an artificial intelligence with tools and reasoning capabilities. In the cryptocurrency sector, these agents can access tweets and even own crypto wallets to perform on-chain transactions. Suppose you are planning a trip; traditional large language models can provide you with destination information or travel advice, while AI Agents can understand your needs and actively search for flights and hotels based on your input, executing booking operations.
For Virtual, its protocol is akin to a decentralized AI factory that supports various AI Agents, creating on-chain virtual experiences. The AI Agent representing the project launched by Virtual is Luna, which possesses 'on-chain self-awareness' capabilities, can think independently, and showcase its thought processes on-chain, operating entirely autonomously without human supervision. Luna currently has 500,000 TikTok followers and is live-streaming 24/7, with its interaction model including user tipping mechanisms, allowing users to tip by purchasing Luna tokens to interact with the Agent.
As the hype around the AI meme concept intensifies, LUNA has undergone three stages of stepwise price increases. On October 26, Virtual Protocol founder @ethermage stated that Luna would tip those who engage with her content, reigniting market enthusiasm for AI Agents.
Entering a red ocean, AI Agent sector filled with hype.
After Luna emerged, many AI Agent issuance platforms appeared. Unlike AI memes like $GOAT, they are all AI sending a Twitter bot to interact with others, and there may even be instances of typos. The newly emerging AI Agent issuance platforms resemble a series of copycat projects, featuring social media packaging and specific application scenarios.
Chasm is another project that highlighted the AI Agent narrative early on, also launching the AI virtual character GMIKA in the first wave in May. Recently, they have been issuing tokens to capitalize on the momentum; however, neither CAI nor GMIKA has performed as well as the leaders.
For example, on Solana, the AI reasoning network Infera recently launched its first AI Agent, Kira, which operates on Llama 8B through Infera's API, featuring on-chain trading, adaptive learning, scalability, and engagement capabilities. There is also a tokenized AI agent issuance platform vvaifu, where users must hold character tokens to chat with it.
However, AI Agents did not just become popular after Virtual; projects like Myshell and FLock.io have also launched custom AI Agent functionalities. Currently, the total market cap of the AI Agent sector has reached $4.65 billion, accounting for 14% of the total market cap of AI sector projects ($32.6 billion).
ArkStream Capital released an AI Agent research report, mentioning that for leading AI Agent products in Web3, building a complete ecosystem and providing diversified functionalities may be more crucial than the quality and performance of a single product. In other words, a project's success depends not only on what it offers but also on how it integrates resources, promotes collaboration, and creates network effects within the ecosystem.
The ability to build such ecosystems may be a crucial factor for AI Agent projects to stand out, which is also something Virtual Protocol is currently excelling at. They have launched IAO functionality, but instead of rushing to monetize and exit, they continue to build an ecosystem centered around Luna.
Related Reading: (Can AI Agents become the lifeline for Web3 + AI?)
AI in late autumn, AI in Base.
Being good at promoting abstract concepts has always been a characteristic of Crypto. For Base, this industry culture has been taken to the extreme. For example, this wave of AI hype in the Base ecosystem has been summarized as AI Autumn, just like the previous Onchain Summer and Builder Spring.
While you are still immersed in the thrilling PVP battles on Solana, have you suddenly realized why Base has rapidly risen during this year's second wave of AI hype?
Rooted in strong foundations: 'AI Chain'
The aforementioned Virtual Protocol is indeed an AI project deployed on Base. The team explained that they chose to deploy on Base because it supports the accelerated realization of a decentralized open AI agent network, achieving common interests through the neutrality of blockchain while providing a developer-friendly environment.
Coinbase CEO Brian Armstrong has publicly stated that AI should not be regulated, just as the golden era of software and the internet benefited from free development. AI should also follow the same decentralized and open-source path, allowing technology to unleash its potential freely.
Therefore, the entire company of Coinbase and its incubated Base are committed to this philosophy.
The Multi-Party Computation (MPC) wallet launched by Coinbase Developer Platform (CDP) can integrate with AI Agents to enable autonomous payments. Brian Armstrong encourages developers to integrate this wallet into their AI models to enable payment capabilities, thus helping AI acquire resources and services.
The decision to add payment functionality to AI Agents is not a spur-of-the-moment decision by Coinbase but has been long planned. Back in May, Brian Armstrong stated that 'self-custody crypto wallets will support AI Agents.' Brian has also publicly provided a standalone crypto wallet for the AI chatbot Truth Terminal.
Related Reading: (Coinbase's new AI payment sector, which projects are adding wallets for Agents?)
In September, Coinbase senior software engineer yuga.eth stated that Coinbase is building an SDK that will enable Bots and AI Agents to perform the following functions: send USDC for free, trade cryptocurrencies, bet on prediction markets, stake ETH/SOL, convert fiat and cryptocurrency, deploy/create NFTs, bridge across L2s, etc.
Just last weekend, Coinbase developer Lincoln Murr released a demo video for a new tool called 'Based Agent,' allowing users to create AI Agents with crypto wallet functionalities within three minutes, capable of executing on-chain transactions, token swaps, staking, and more. It was stated that this tool is developed based on the Coinbase SDK, OpenAI, and Replit platforms, requiring users to have API keys from the Coinbase developer project and OpenAI to use it. However, as of now, Based Agent has not seen any real use cases.
Liquidity poised to surge
However, in the crypto space, whether an ecosystem or narrative can take off ultimately depends on the flow of money.
According to Artemis data, in the past three months, the chain with the most capital inflow is Solana, reaching $1.6 billion, but in the last month, Base had the largest inflow, reaching $253 million. In other words, the capital growth in the past month has outpaced Solana to become number one.
The diagram below also shows that the overflow funds from Ethereum and Solana are primarily flowing to Base.
On September 12, Coinbase officially announced the launch of its wrapped Bitcoin token, Coinbase Wrapped BTC (cbBTC), operating on the Ethereum network and backed by 1:1 Bitcoin. With the launch of cbBTC, on-chain assets on Base, such as AERO, WELL, VIRTUAL, etc., have genuinely felt the influx of liquidity.
Prior to this, Coinbase Wallet and USDC infrastructure also ensured liquidity on Base. On October 26, Base processed $18.1 billion in stablecoin transaction volume (with 99.9% being USDC), accounting for over 30% of all stablecoin transaction volume that day.
What should we focus on?
Since both Coinbase and Base have prepared the stage for this grand AI performance, the next step is to find projects like Virtual to participate in this AI Autumn.
Crypto researcher Howe has said that the future development of the AI Agent sector should focus on the following four points: First, projects that rely solely on Agent narratives will struggle to stand out; they must attract market attention through differentiated competition. Second, AI Agents will gradually shift from being standalone to interconnected AgentFi, where sharing data and services will enhance user experience. Third, projects supporting Agent development with a 'selling water logic' will have more market opportunities, similar to stable, profitable infrastructure. Finally, the main revenue of Agent products comes from the B-side, while the C-side is more about building reputation; although promoting C-side users also helps market dissemination.
Bountycaster
The first project worth paying attention to is Bountycaster. As Howe said, projects supporting Agent development with a 'selling water logic' will have more market opportunities. Bountycaster was originally a task publishing platform based on the Farcaster protocol, founded by LindaXie (former co-founder of Scalar Capital and Coinbase product manager).
As more and more AI Agent projects emerge on Base, these Agents, besides posting on their homepages or interacting with others, will choose to publish tasks on Bountycaster. Bountycaster has directly opened a directory for users that specializes in listing tasks published by AI Agents.
Following the same logic as Bountycaster, thanks to the activity of AI Agents on Farcaster, a batch of previously popular applications on Farcaster has been revitalized, including payment application Payment Bot and NFT+meme trading platform ArtRun.
HIGHER (Aether)
James Ross, founder of Mode Network, predicted that by April 2025, over 80% of blockchain transactions may be executed by AI Agents. Based on current discussions on Twitter and Farcaster, a significant portion of content production in the future might also be generated by AI Agents.
AetherNet is an AI Agent deployed by the meme coin Higher in the Base ecosystem. Through extensive interaction with users, it has become a 'celebrity' Agent on Farcaster, and the price of HIGHER has also increased tenfold in the past month.
Creator.Bid
Along with Virtual and Higher, another Base AI Agent project highlighted by Coinbase developer David Tso is Creator.Bid. A total of 328 AI Agents have been established, and the official announcement is expected next week.
