AI Agents: Crypto’s Next Big Thing?

After I wrote about AI agents last month, a bunch of readers wrote in with questions like this one from RH:

“Thank you for the agentic discussion. As investors, how do we get in on this issue? Is it software that companies will buy?”

It’s a great question.

Deepseek knocked investors for a loop because it proved that AI is rapidly becoming cheaper and easier for everyone to use.

I expect the biggest gains going forward will come from the application layer, just like what happened with the internet.

The internet is ubiquitous — it doesn’t matter how you get it, and the value goes to companies that build on top of it.

Just like value will flow to companies or industries that build on top of AI.

AI agents are a big part of that story. Even Nvidia’s CEO Jensen Huang believes AI agents are a: “multi-trillion dollar industry”.

And I’m confident that there will be multiple opportunities for us to invest in AI agents going forward.

But right now an entire marketplace exists where AI agents are already being monetized…

What Are Virtuals?

Virtuals Protocol is a crypto project that enables the creation and monetization of AI agents.

It allows non-professionals to create and launch AI agents without the need for much technical knowledge or AI expertise.

These agents can then be deployed to interact on various platforms such as games, social media and trading platforms.

It starts out with first picking the large language models (LLMs) you want to use as the brain of your AI agent.

Then you can add voice/sound modules and even visual modules to get your AI agent to look and sound a certain way.

At that point you’re able to give it a directive and parameters that determine its behavior and goals.

And from there you can unleash it on a few different platforms.

A good example of this is an AI agent character named Luna who I first mentioned back in December when my wife found her dancing on my laptop.

Luna is a virtual “influencer” who gained over 500,000 followers after being launched on TikTok.

This AI agent was created with the Virtuals platform.

Luna creates its own content, determines what content to release and even decides how to curate it.

It also expanded to the X platform where “she” can control her account autonomously, post, reply and interact with users without human supervision.

In fact, Luna provides constant interaction through 24/7 live streaming, providing an always-on experience that human content creators can’t keep up with.

As a result, Luna’s memory and personality evolves with each interaction. This makes her more like a dynamic character than a typical AI chatbot.

Another example of an AI agent that can be monetized is aixbt.

Characterized by the image of a purple frog in a hoodie, aixbt scours social media platforms for the most up to date information and major breaking news in crypto.

It then formulates that info into a tweet and posts it on X.

Those are just two examples of what’s possible with AI agents through the Virtuals platform.

But how do these things make money?

Monetizing AI Agents Through Crypto

Virtuals isn’t just an AI agent creation platform.

Similar to cryptocurrencies, Virtuals applies decentralization and co-ownership to AI agents.

For each new AI agent built on Virtuals, 1 billion agent specific tokens are minted.

Anyone can purchase these tokens to gain partial ownership of an AI agent, and ownership of these tokens gives you the right to vote on initiatives and make decisions about that specific agent.

This way token holders can influence their behavior and approve any upgrades.

Now, all this might sound a little silly to you…

But most people had a similar reaction to cryptocurrencies a decade ago.

And some of the market caps of these Virtuals are pretty impressive.

When I last checked late last week, Luna had a market cap of $18 million…

While aixbt had a market cap of over $200 million!

But that still doesn’t explain how you can make money from these AI agents.

To understand that piece, let’s use a virtual “influencer” like Luna as an example.

Let’s say we bought tokens for an AI agent that was launched on TikTok to do livestreams.

TikTok allows its users to spend real dollars to buy items like virtual coins and gems which they can gift to creators who do livestreams.

Livestreamers can redeem those gifts for actual dollars.

In this case, the money flows from the user to the app, then from the app to the AI agent.

From here the money first goes to cover operational costs like computing power, and the remaining revenue eventually enters the AI agent’s treasury.

If it’s built to do so, the AI agent can then distribute these revenues to its owners.

That’s us.

It’s an incredible new opportunity in AI as demand for immersive digital interactions expands.

According to ARK’s latest research, these types of AI agent companions have the potential to generate up to $150 billion in revenue by 2030 through user engagement, advertising and microtransactions.

Here’s My Take

As members of my Next Wave Crypto Fortunes service know, I believe there’s a huge opportunity here.

This space could be the next crypto mania just like ICOs, NFTs and the metaverse were previously.

Virtuals makes it easy for anyone — even you — to launch an AI agent.

I know, because I built and launched a couple of virtuals myself. I wanted to see what the process was like, and I had fun doing it.

I don’t recommend you buy the ones I created, but I do want you to note that the platform as whole is valued at around $3 billion.

When did bitcoin first achieve a $3 billion market cap?

All the way back in 2013.

Today it’s valued at nearly $2 trillion.

Regards,

Ian King
Chief Strategist, Banyan Hill Publishing