AI Agent Track Analysis: Why is there still a 10x rise in potential?

Before analyzing the AI Agent track, let's first review the changes that the cryptocurrency industry has experienced during this cycle from a macro perspective:

Bitcoin and Other Crypto Assets Go Their Separate Ways

Bitcoin was once almost synonymous with the entire cryptocurrency market; buying Bitcoin meant endorsing the concept of crypto assets and decentralization. However, after the approval of the Bitcoin spot ETF, the recognition of Bitcoin's value has become a mainstream perspective, spanning from politics to business. Nevertheless, other crypto assets like Ethereum seem to have not gained the favor of mainstream society and capital as a result.

This differentiation mainly stems from the differences in asset positioning:

• Bitcoin is regarded as an alternative asset similar to gold, and its properties of hedging against inflation and preserving value beyond sovereign currencies are widely recognized.

• Cryptocurrencies like Ethereum still lack mature and sustainable business models in the eyes of traditional financial institutions, resembling more of a tech concept stock. Compared to tech giants like NVIDIA, Microsoft, and Amazon, which have large user bases and mature products, the valuations of these crypto assets are not low, but the return elasticity is insufficient, making the risk-return comparison relatively low from an asset allocation perspective.

From the perspective of the Sharpe ratio, Ethereum is lower than tech companies like Meta and Google, while Bitcoin is only second to NVIDIA, which performed exceptionally well in this cycle.

Another important factor is that the current monetary policy in the macro environment is relatively tightening, combined with the booming AI industry, which results in insufficient attractiveness of cryptocurrencies to off-market funds. After all, the total amount of funds is limited; funds invested in AI stocks and GPUs cannot flow into other crypto assets.

Serious Imbalance within the Cryptocurrency Ecosystem

Although the total amount of funds in the market has far exceeded the last bull market, most other cryptocurrencies, except for Bitcoin, have not reached new highs. This supply and demand imbalance stems from several factors:

1. Supply side: A large number of newly funded projects with high valuations lack practical application scenarios and real users.

2. Demand Side: Centralized exchanges are shrinking their operations under regulatory pressure, reducing activities such as user expansion and early project opportunity sharing, leading to insufficient buying momentum.

3. Exit channels are limited: Centralized exchanges, as the main exit channels, have shifted towards profit-oriented approaches under tightening regulations, reducing support for new projects.

Unique Advantages of AI Agent Compared to Meme Coins

Every bull market requires new asset issuance and trading models to generate wealth effects. Against the backdrop of a severe imbalance between supply and demand, Meme coins have taken the lead in breaking through with features such as no VC financing and fair issuance, driving new asset issuance and trading tracks.

However, the characteristic of Meme coins lacking practical use makes it difficult for them to gain widespread recognition. In contrast, AI Agents are able to consolidate more consensus:

• For fund LPs, we can tell the story of investing in AI infrastructure.
• For cryptocurrency enthusiasts, you can talk about the on-chain meme logic.
• For industry practitioners and investment institutions, you can explain the logic of investing in the AI Agent project.

In summary, the AI Agent has become the greatest common divisor of the Web3 industry in this cycle.

AI Agent Project Analysis Framework

From Dapp to AgentApp

AI Agent has reshaped the industry chain and valuation logic of cryptocurrency. After integrating AI into the underlying technology stack of blockchain, the AI layer runs in parallel with smart contracts, forming a full-chain Agent layer. This explains why previous AI projects failed to lead new narratives - they were still confined to the realm of smart contract applications (Dapp), while AI Agent exists as a binder between the underlying blockchain and off-chain data.

Based on this logic, we can refer to the valuation ratios of leading DeFi projects to estimate the potential of AI Agent projects:

• The AI Agent framework may reach 5% of Ethereum's market value.
• A launch platform with a framework may be equivalent to a combination of Chainlink + Uniswap.
• High-quality products like FAI may reach 1.25%-3% of Ethereum's market value.
• Other top projects such as Spore and aixbt may have a lower limit of a $1 billion valuation, while the upper limit depends on market developments.

change the internal competition ecology of cryptocurrency

The biggest advantage of AgentApp lies in the innovation of interaction methods:

• Asset Purchase: Buy and sell directly using natural language from traditional exchange apps to Agent applications.
• Financing: From seeking VC funding to directly showcasing products to the community for support
• Token Issuance: From complex launch processes to AI automated token issuance, agents manage private keys and control the fund pool.

This cycle follows several important criteria:

• The project is open source, and the application is verifiable
• Funds are relatively safe, avoiding the risk of developers withdrawing liquidity.
• Transparency in financing and token issuance, reducing unfair phenomena

Although there are still some issues with Agent token issuance, there has been significant progress compared to traditional methods. The AgentApp, which can win user trading entry, is very likely to reach the valuation level of exchange platform tokens.

long-term outlook

From a more macro perspective, AI Agents may form a new AI society, creating a trillion-dollar level economic system. In this AI economy, Bitcoin and cryptocurrencies will become important currencies and economic circulation assets. For AI life forms, AGI is the brain, robots are the body, and cryptocurrencies grant autonomous identity and economic systems.

AI Agent Track Development Stage

According to market capitalization data, the total market value of AI Agent is approximately $18.6 billion, accounting for 64% of the total market value of DeFi projects, 75% of the GameFi sector, and 62% of Layer 2 market value. Although the statistics are somewhat rough, judging from market sentiment, the AI Agent sector is in the middle stage of a rise, with still considerable room for growth.

Possible hot directions in the future include:

1. Agent-driven cryptocurrency exchange: achieving decentralized listing, asset custody, and token issuance
2. Agent-driven stablecoins: AI automatically adjusts to maintain stability
3. Application Agentization: Various applications will integrate Agent services into core functionalities.

Overall, the era of AgentFi has just begun, and there is still enormous development potential and room for imagination in the future.