The year 2024 has seen an increasing convergence of artificial intelligence (AI) and blockchain, a trend that promises to revolutionise the cryptocurrency industry. While the focus in the past was on decentralising the infrastructure for data input and training AI models, the focus has now shifted to the development of ‘AI agents’: intelligent bots capable of performing complex tasks autonomously.
Historically, projects such as Numerai (2015) relied on crowdsourcing data for investment decisions, while BitTensor (2023) took a more decentralised approach to the development of advanced AI models, similar to ChatGPT. However, 2024 marked a turning point with the advent of AI agents focused on specific activities such as cryptocurrency trading, wallet management and user interaction.
An emblematic example of this new trend is Truth Terminal, a chatbot developed by Andy Ayrey in March 2024. Thanks to its witty responses on X (formerly Twitter) and integration with a crypto wallet, Truth Terminal attracted attention, culminating in a $50,000 Bitcoin donation from venture capitalist Marc Andreessen in July of that year. Truth Terminal’s influence went further, inspiring the creation of the Goatseus Maximus (GOAT) meme coin, with part of the supply airdropped to the bot. The subsequent increase in GOAT’s market capitalisation to over $300 million made Truth Terminal the first AI chatbot to achieve millionaire status.
This success triggered a domino effect, leading to the integration of AI agents into DAOs (Decentralised Autonomous Organisations) of venture capitalists focused on crypto investments, such as ai16z, a community-managed tokenized fund that uses AI and oversees the Eliza development framework, to create other agents.
But how do these AI agents actually work within a blockchain network? James Ross, founder of Mode (a Layer 2 network focused on agent development), explains that:
“an AI agent on a blockchain is essentially a smart contract that can independently execute decisions based on data, without human approval“.
Developers can implement access controls to define the conditions under which agents can operate, opening up new possibilities for the application of AI in the blockchain. In practice, each agent can function as a dApp (decentralised application) with its own utility token.
The use of AI agents for managing crypto wallets and signing private keys opens the way for new applications, from supervising and verifying blockchain nodes to executing trades on behalf of other users. The main goal is to improve the user experience and automate interactions with blockchain-based assets, offering functionality similar to traditional software-as-a-service (SaaS) applications.
Eito Miyamura, crypto researcher and founder of the AI-based security network GatlingX, emphasises the potential of AI agents in crypto payments, where they can operate with greater freedom than traditional payment systems, which are subject to greater regulatory constraints. Miyamura believes that ‘the ideal use case for AI agents is when you want an agent to work and perform crypto payments, purchases and financial transactions.
Ross of Mode highlights how cryptocurrencies, unlike Web2 systems, enable the creation of trustless and permissionless wallets, allowing AI agents to operate freely and add value to areas such as DeFi (Decentralised Finance). In this regard, he cites the development of Giza, a performance optimisation agent that operates on Mode’s blockchain to maximise DeFi profits. Users can set up a wallet with Giza, which analyses different DeFi protocols and, via an off-chain machine learning model, moves funds to achieve the best returns.
However, AI agents in the crypto sector are still ‘semi-autonomous’, operating under human supervision. On-chain verification of AI decisions still requires human intervention, at least until a more reliable verification method is developed. Nevertheless, full autonomy of agents on blockchain networks is expected to be only a matter of time.
In short, it is not only the world of Bitcoin, Ethereum, and Altcoin that moves the crypto market, a new and promising scenario seems to be emerging, but as usual and as with all ‘bubbles’, all factors in play must be weighed and not get caught up in the mania for easy profits.
