Will AI drive the next DeFi Summer?

Perhaps the next wave of real “DeFi Summer” will arrive due to DeFAI, allowing more users to enjoy the potential benefits of decentralized finance with a low threshold.

Written by: WOO

Background: The difficulty of using DeFi has been an old issue, with a penetration rate of only 1.4%.

According to Triple A's 2024 Global Cryptocurrency Ownership Survey, approximately 6.9% of the world's population currently owns cryptocurrency, which is 562 million people.

DeFi has always been regarded as the hope of Mass Adoption, but its penetration rate is disastrous.

How to estimate the number of DeFi users? It can be calculated from the number of daily active users of the current mainstream public chains/Layer 2. The total number of daily active addresses of ETH, Base, and Solana is approximately 8 million. This does not include witch addresses and multi-chain players, so 8 million is a high number. estimated figures.

8 million/562 million = 1.4%

In other words, the current DeFi penetration rate among all currency players is only 1.4%, but the proportion of transaction volume has grown at the speed of light. The current share of DEX in CEX transaction volume is a record high, reaching 16.7%

This also leads to the fact that the DeFi market is still dominated by old users with large amounts of funds and is not very attractive to new users.

So the main reason why DeFi is difficult to attract new users is still around the high knowledge threshold and poor user experience. Taking the simplest Swap as an example, users must know how to transfer tokens to the chain, reserve Gas Tokens, and know what slippage and authorization are. A series of complex operations are not as complicated as on a centralized exchange. One-click buying and selling is convenient and fast.

So is DeFi destined to become a zero-sum game and an amusement park for old users?

The participation of AI may be able to break through the past dilemma of DeFi, and this has also given rise to another new narrative - DeFAI

Reference: https://www.triple-a.io/cryptocurrency-ownership-data

What is DEFAI?

If DeFi represents the innovation of financial decentralization, then DeFAI (DeFi + AI) is the next stage of evolution to make "decentralized finance truly accessible to the public." The core value of DeFAI is to "use AI to reduce the complexity of DeFi" and further expand application scenarios so that more people can use various blockchain financial services easily and safely.

The core values ​​of DeFAI have the following three points:

Lowering the operating threshold: Users no longer need to manually switch between various complex interfaces. They only need to enter natural language instructions such as "Swap 1 ETH to USDC, then put it into a pool to provide liquidity", and AI can help you complete the multi-step operation.

Automated strategies: Arbitrage and investment strategies that in the past required professional traders to develop can now be run by AI agents and even automatically adjust risk parameters, allowing ordinary investors to enjoy quantitative-level tools.

Integrated data analysis: AI can simultaneously monitor community volume, KOL comments, on-chain transaction data, price trends, etc., and automatically place orders when conditions are met, providing operations closer to actual market conditions.

DeFAI categories & representative projects

AI abstraction layer: Abstract complex DeFi operations (Swap, Bridge, pledge, etc.) through natural language, allowing users to only enter intuitive instructions such as "I want to exchange 2 ETH for USDC and provide liquidity." Behind the scenes The AI ​​agent automatically connects multiple protocols, optimal paths, optimal gas consumption, etc. This type of DeFAI project is also the largest.

Representative projects:

1.Griffain

Running on the Solana ecosystem, it can support operations such as natural language transactions, Mint NFT, and pre-emptive purchase of new coins (Sniping).

The Solana Foundation has retweeted Griffin's tweets many times.

It can work collaboratively through multiple agents and has customized automation functions.

2. Heyanon.ai (anonymous)

Developed under the leadership of the Danielesesta team, it emphasizes "one-stop" cross-chain trading, lending, and income strategy integration.

The backend is connected to the cross-chain bridge LayerZero, the real-time price oracle Pyth, etc., which can help users quickly complete complex operations.

3.Grift

Focusing on cross-chain functions, it integrates more than 100 public chains and more than 200 DeFi protocols to facilitate users to manage assets across chains.

Special emphasis is placed on automated strategies and liquidity management, and can handle multi-step trading processes.

4.Buzz

Winning the championship at Solana AI Hackathon.

Not only can users complete trading intentions using natural language input, but they are also provided with detailed information about liquidity pools, token locks, and portfolios of smart money addresses.

Automated trading agent: After obtaining user authorization, this type of AI agent can automatically execute complex, multi-step trading strategies, such as "regularly buying ETH and depositing it into the liquidity pool", "automatic arbitrage after cross-chain bridging", etc. Use Users only need to put forward high-level requirements without having to manually handle the details.

Representative projects:

1.Almanak

Focusing on institutional-level quantitative trading and security; using TEE (Trusted Execution Environment) to prevent strategies from being stolen or MEV attacked.

The strategy can be simulated in the EVM fork environment first, and then officially deployed to the main network to reduce actual operational risks.

2.Cod3x

Provides a "code-free" strategy development environment, allowing users to drag and drop components to create AI trading agents

Integrate external APIs and machine learning prediction models to make trading strategies smarter

Market analysis agent: This type of AI is used to integrate and analyze huge on-chain data, KOL tweets, discussion forum trends, etc., to provide users with instant and multi-faceted market insights. If combined with a trading agent, it can automatically execute transactions.

Representative projects:

1.AIXBT

Track the interaction between more than 400 KOLs and the community, and monitor topic popularity and community sentiment in real time.

Can answer user questions and provide real-time analysis or token trend predictions.

2.Kwant

Technical analysis based on K-line charts gives users investment advice.

Conclusion

DeFi once blocked mass users due to its high threshold and operational complexity, forming a "niche circle" dominated by a small number of old users with large amounts of funds. But with AI's breakthroughs in conversational interfaces, strategy automation, and data integration, DeFAI has opened up a new path for "decentralized finance." In the future, everything from simple natural language transactions to advanced automated arbitrage and even a multi-agent collaboration ecosystem will become more mature due to DeFAI.

Perhaps the next wave of real “DeFi Summer” will arrive due to DeFAI, allowing more users to enjoy the potential benefits of decentralized finance with a low threshold. At the same time, professional investors can also use this to implement more flexible and safer trading strategies. As blockchain and AI continue to deeply integrate, the wave of DeFAI is also gradually expanding, which is worth looking forward to and continuing to observe.