AI Agent cools down, why is Virtuals still expected to become a tens of billions giant?

Author: Primitive Astronaut

Compiled by: Luffy, Foresight News

Have you ever seen a table that shows how many times you need to make a profit to recover your investment after losing money? For example, when your position falls by 10%, you need it to rise by 11% to recover your capital:

$100 → $90 = -10%

$90 → $100 = +11%

When you lose 20%, you need to increase by 25% to recover your capital:

$100 → $80 = -20%

$80 → $100 = +25%

When you lose 50%, you need to rise 100%, and so on. This relationship is exponential and very counterintuitive.

Many cryptocurrency investors sometimes still lack this basic investment knowledge.

Looking further, in the extreme case of losses of 99% and above, the counterintuitiveness of this exponential growth is even more obvious:

• When the loss is 99%, a profit of 100 times (i.e. +10000%) is required to recover the capital.
• When the loss is 99.5%, the profit needs to be 200 times (+20000%).
• When the loss is 99.8%, the profit needs to be 500 times (+50000%).
• When the loss is 99.9%, the profit needs to be 1000 times (+100000%).
• When the loss is 99.99%, the profit needs to be 10,000 times (+1000000%).

This is why stop loss is a must for active traders. Even though the Virtuals Protocol platform took a big hit last week (with price drops seen as a sign of poor technology), I think it will remain at the top for quite some time.

I emphasize these at the beginning because I want everyone to notice that there is a huge difference between 99.8% and 99.9%, which may seem similar.

Next, look at the data on tokens created on Pump.fun: since the beginning of January, the total number of tokens is 6 million, and the average number of tokens created every day is about 50,000.

Now think about it, how many "reliable" projects have been born in Pump.fun? In this field, the word "reliable" actually doesn't mean much. For the sake of argument, we define "reliable" as "a market value exceeding US$10 million." After all, we are all here to find the next 100-fold coin. For most people, this is what “reliable” means.

On average, only 1% of the projects launched by Pump.fun every day can reach the "graduate" standard with a market value of more than US$70,000. Moreover, many projects ran away just after reaching the standard or slightly exceeding the market value.

Take a look at last month, one of the most active periods ever for Pump.fun:

There are 10 projects with a market value exceeding US$10 million, and only 7 of them have exceeded US$20 million. In other words, only 0.0014% of the projects launched by Pump.fun that month exceeded $10 million in market value, which means that 99.9986% of the projects failed to meet the target.

Now, let's compare this to Virtuals' data and draw a simple conclusion.

Since its launch on October 16, the Virtuals Protocol platform has launched a total of 15,845 AI agents. That’s about a third of the number of projects Pump.fun launches in a day. Last month, the platform launched an average of about 175 agents daily.

I could not find data on the Dune dashboard about the number of agents with a market value of more than $10 million on the Virtuals platform, so I counted them manually: at the time of writing this article, there are 35 agents on the Virtuals Protocol platform with a market value of $10 million or more. Among the 15,845 launched agents, 35 accounted for as much as 0.22%! This means that 99.78% of Virtuals agents have not crossed the $10 million market capitalization threshold.

Now think back to what I mentioned at the beginning, the huge and counterintuitive difference between 99.78% and 99.9986%. Of course, this is just a rough estimate.

But I believe you already understand: Compared with blindly investing in projects on Pump.fun, blindly investing in projects launched on the Virtuals platform has a much greater chance of obtaining huge returns.

However, you wouldn’t invest blindly, right?

The real conclusion comes next.

As a Launchpad, Virtuals far outperforms other platforms in every aspect. In this example, there are many comparable aspects that have not yet been mentioned. for example:

• Pump.fun earned $400 million in fees in a year, while Virtuals Protocols earned $55 million in fees in just three months.
• Pump.fun has approximately 300,000 daily active users and 8 million unique wallet addresses within a year. There are even less than 300,000 independent wallet addresses holding Virtual proxy tokens (only 280,000).

All in all, Virtuals Protocol accomplishes more with less. There is no need to even compare the current gap between the Solana chain and the Base chain in terms of user activity, transaction volume and total locked position (TVL):

Data source: DefiLlama

However, this gap is narrowing as more and more large investors announce (or even have already) turned to the Base chain to invest in artificial intelligence agency projects. Even people like @frankdegods and @notthreadguy, who were initially cynics about the Base chain project, have changed their attitudes.

It is recommended that everyone pay attention to @jessepollak's announcement about the future development of the Base chain. Its roadmap is impressive, and Coinbase is paying close attention. The Base chain is committed to achieving better DeFi expansion than other Ethereum Virtual Machines (EVMs) and will soon support multiple fiat currencies on the chain. Coinbase’s stock $COIN and numerous liquidity pools will also be tokenized! Many people forget that the Base chain has just started.

Over the past few months, funds have continued to flow into the Base chain.

Last but not least, Virtual’s token economic model. You should really dig into it, this is their real advantage over their competitors, and they were the first movers.

Launchpad functionality creates the highest quality ecosystem and token economic flywheel. This flywheel has brought huge benefits to the team, whether it is handling fees or token appreciation, allowing the team to have sufficient funds for investment and upgrades (GAME and CONVO functions will definitely be optimized in the next few months). And this flywheel effect also benefits every agent token created on the platform.

Recently, the Virtuals team seems to be shifting its focus to the gaming space with artificial intelligence agents. In my opinion, this is a smart move: this is their original intention and area of ​​expertise, and it is very likely that game narrative will return again during the feverish stage of this market cycle. In addition, they are laying out a narrative direction that is compatible with the Web2 mainstream. After all, non-player characters (NPCs) have a lot of potential in this area, don't they?

Their platform is ready to be deployed on the Solana chain!

My weekend research on the Solana chain made me realize that the trading activity and volume there are amazing. After all, I will be on the Base chain until the end of 2024. At the same time, I am also amazed by the advancement of Solana's trading tools and the improvement of the trading experience.

But I also find that the market is more predatory today than it was six months ago. The escape methods of some projects are becoming more and more complicated. Seeing 99% of my losses, I can only lament that "it's a good game." Overall trading activity leans more towards extreme speculation. I have entered this field since 2017. I am a speculator at heart, but I appreciate smart and intelligent speculation more.

On the Base chain, everything is slower, including transactions, transfers, token authorization, and price increases and decreases.

However, the user interface (UI) and user experience (UX) are constantly improving, and related tools are constantly being developed. Currently, the Base chain is still in its early stages, and lower popularity means less predatory, more like player versus environment (PvE) than player versus player (PvP).

This also means there are many opportunities on the Base chain. Just like the comparison between 99.78% and 99.9986% mentioned above, the opportunities are particularly prominent in this area with less noise. Moreover, the large amount of idle funds transferred from Ethereum is the icing on the cake.

Compared to similar projects on the Solana chain, there are far fewer scammers on the Virtuals platform. Looking at the farce of AICC last week, and comparing it with the DTRXBT project launched by @beast_ico and @ghost93_x today, Virtuals is taking a more win-win-oriented approach to include all community members, including ordinary investors.

Virtuals continues to attract serious and reputable real-name developers. Of course, just like elsewhere, some developers may cut the leeks and run away. But listening to @NickPlaysCrypto ’s interview reveals that until now, not all new developers have been scammers.

I will not give a formal summary, the point I want to make is already obvious. Let's all draw our own conclusions, and I hope to see you on the "battlefield" of Virtuals soon. In my opinion, this is far from over. For those who are already involved, the best is yet to come.