The AI Agent market continues to heat up, with Virtual and AI16Z becoming industry leaders.

The wave of AI Agents will sweep in during the fourth quarter of 2024, with no decrease in popularity in 2025. As of early January 2025, the overall market value of AI Agents has surpassed 16.9 billion USD, an increase of approximately 22.7% compared to the previous week.

In this wave, two projects have emerged as industry leaders. The main AI Agent issuance platform on the Base chain, Virtuals Protocol, has a market cap that has surpassed $5 billion, ranking it among the top 40 cryptocurrencies. Meanwhile, in the Solana ecosystem, the venture capital firm ai16z, managed by AI Agents, has also exceeded a market cap of $2.5 billion.

These two major protocols have become the barometer for observing the AI Agent track. They each have their own characteristics, and there are differences in their development paths. Let's take a look at their development history, core products, and future prospects.

Development History

Virtuals Protocol: From Gaming Guilds to AI Agent Issuance Platform

The predecessor of Virtuals Protocol was the gaming guild PathDAO, established in December 2021. As the gaming guild market cooled down, the team attempted several transformation projects during 2022-2023. Although unsuccessful, they realized the potential of AI. In 2023, the team proposed a complete transformation into the AI field and gained 90% member support.

In 2024, they explored AI Gaming on the Base chain and launched a platform. Although they initially failed due to a lack of market fit, the team made several breakthroughs in the AI field, including the world's first Roblox AI RPG and AI games without a game engine. Their virtual host Luna, launched on short video platforms, also achieved good results. Ultimately, the success of the GOAT project provided excellent development opportunities for the Virtuals Protocol.

AI16Z: From Web 2 AI to Web 3 AI

The founder of AI16Z, Shaw, was initially a game developer before shifting to the AI field, focusing on the development of AI Agent technology. He has also ventured into the fields of Web3 and 3D spatial networks.

The inspiration for AI16Z comes from a project called "AI version degen Spartan." This AI has disrupted people's stereotypes about AI on social media, showcasing a unique personality and emergent behavior.

Through his connections in the industry, Shaw conceived the idea of creating AI investors. His vision is to build a fully autonomous, trustworthy investment system that serves the community. AI16Z set a fundraising target of 4,420 SOL at launch, selling out in just 20 minutes, demonstrating strong market interest in this innovative model.

Core Product

Virtuals Protocol: iOS of AI

Virtuals Protocol is the issuance platform for AI Agents, functioning similarly to Pump Fun. The platform uses $VIRTUAL as the trading pool, and the more AI Agents created on the platform, the more $VIRTUAL is empowered directly. Buying and selling AI Agent tokens will consume at least 1% $VIRTUAL.

The platform has established a common standard for its AI Agent tokens, emphasizing precision and careful planning. They use the AI Agent framework GAME, which can operate autonomously, process inputs, and generate responses, while also learning from past interactions.

In terms of products, Virtuals Protocol provides relevant development tools for its AI Agent, making the overall ecosystem more complete. Its model is quite similar to Apple's iOS.

AI16Z & ELIZA: The Android of the AI World

AI16Z is a fund managed autonomously by AI, using a hybrid strategy. In addition to allowing AI to operate independently, it also includes a community interaction mechanism that allows for trading suggestions. If community members can help the AI Agent make money, they will gain more trust, similar to a decentralized mutual fund.

ElizaOS is an open-source framework for AI Agents, allowing developers to construct, experiment, and launch AI Agents without restrictions, with a stronger emphasis on decentralization, collaboration, and innovation.

The core features of ELIZA include:

1. Character Profile System: Define a unique digital personality for each AI Agent.
2. Action System: Treat each action as an independent event, divided into two stages: intention decision and execution.
3. Providers and Evaluators: Enrich the conversational capabilities of AI Agents to make their behavior more human-like and interactive.

ELIZA also has autonomous trading capabilities, ensuring the security of operations through a trust engine and trust market. Its external system promotes the growth of the developer ecosystem, creating a virtuous cycle.

Catalysts Driving Coin Prices

Virtuals Protocol

The business model of Virtuals Protocol is clear, with its products closely tied to the token price. To estimate the sustainability of token price increases, one can focus on observing the trading volume of ecosystem tokens and the number of issued tokens.

The platform does not pursue the growth in the number of tokens issued, but rather hopes to incubate quality projects. The key factor in driving up the value of Virtual tokens is whether it can continuously incubate excellent AI Agent projects.

Currently, there are 8 tokens in the Virtuals Protocol ecosystem with a market capitalization of over 100 million USD, accounting for 33.3% of the overall mindshare in the AI Agent market, making it the largest ecosystem for AI Agents. Whether more tokens can reach the 100 million USD market cap in the future, and whether the overall ecosystem can maintain its mindshare, will be key to observing the rise and fall of the Virtuals Protocol.

AI16Z/Eliza

The overall ecosystem of AI16Z is relatively weak, and projects developed using the Eliza architecture cannot directly provide value back to AI16Z/Eliza. This is also one of the reasons why the current market value of AI16Z is only half that of Virtual.

The strategic model of AI16Z is more like "surrounding the city with the countryside." The emerging AI Agent project can use the ElizaOS architecture as promotional material, and if it can get a retweet or reply from the founder Shaw, it will further increase its legitimacy.

Whether the market value of AI16Z can continue to rise in the future depends on the depth, speed, and quantity of its cooperation with other protocols. Recently, AI16Z has partnered with other well-known framework protocols (such as ARC and FXN), and we look forward to more strong collaborations in the future.