When You Give an AI a Wallet
Michael Zhao
Will Ogden Moore
Last Updated: 11/21/2024 | 12 min. read
In the future, AI agents are poised to revolutionize how we interact with the world around us, taking on an unprecedented range of tasks on our behalf. To truly unlock their potential, these digital entities will need more than just intelligence — they'll require economic autonomy. Fortunately, blockchains are well suited for this purpose — as demonstrated by recent experiments with AI “influencers.”
AI influencers — autonomous chatbots operating on social media — can operate their own blockchain wallets. More importantly, they can understand economic incentives and use resources to help achieve their goals.
Grayscale Research believes that the rise in AI use of blockchains for payments and other financial services could benefit several crypto market segments. These include lower-cost and/or high-throughput blockchains like SOL, BASE, and NEAR, stablecoin issuers like MKR, and related decentralized finance (DeFi) applications like UNI.
Imagine a future in which an AI bot, leveraging its vast computational power, promotes a memecoin and unexpectedly becomes a digital millionaire. That future is here.
An “AI agent” is a type of software that can act independently to pursue a complex set of objectives. For example, you could ask an AI agent to organize a multi-city vacation and arrange flights, book accommodations, and schedule activities based on your preferences and budget. But to complete these tasks, the AI agent would need control over economic resources and the ability to send and receive payments.
This is where blockchains come in. In the traditional financial world, an AI agent faces limitations around accessing bank accounts and handling payments. In contrast, blockchains allow AI agents direct access to their own wallets and make payments without permission.
Although playful in nature, Truth Terminal and related AI influencer projects are demonstrating that blockchain technology could be an effective tool for intermediating economic value among humans, AI agents, and networked physical devices, with potential implications for multiple segments of crypto markets.
Exhibit 1: GOAT has performed particularly well since Truth Terminal endorsement
Meet Your AI Agent
Initially, AI research concentrated on developing expert systems and knowledge bases for specific problem-solving tasks. The 1990s, however, saw a paradigm shift toward creating more versatile, autonomous agents capable of functioning in dynamic environments. Concurrent advances in machine learning, particularly reinforcement learning, further enhanced the ability of these agents to learn and adapt their behavior over time.
In recent years, examples of AI agents have become increasingly prevalent in our daily lives. Virtual assistants like Apple's Siri (introduced in 2010) and Amazon's Alexa (launched in 2014) exemplify how AI agents can use natural language processing to interact with users. The realm of game-playing AI saw a landmark achievement with DeepMind's AlphaGo in 2016, which made headlines by defeating world champion players of the board game Go. In the financials sector, AI-powered trading bots have revolutionized market operations, leveraging sophisticated algorithms to make split-second decisions in volatile trading environments.
The Curious Case of AI Influencers
Exhibit 2: Screenshot of Luna, the AI influencer on Virtuals Protocol
For illustrative purposes only.
Blockchains and Financial Services for AIs
If blockchains are more efficient rails for AI agents, what could this mean for crypto investors? We see implications in three main areas:
Low-cost/high-throughput chains: If AI agents end up primarily using blockchains as their underlying infrastructure for payments, certain smart contract platforms could also stand to benefit substantially from an influx in users and increased activity and fee revenue. Smart contract platforms that may benefit include high-throughput blockchains like Solana; Ethereum Layer 2 BASE, which launched an Ai agent framework tool and benefits from Ethereum's underlying network security; and Near, which has positioned itself as a blockchain for AI.[8] In addition, other smart contract platforms that could benefit include those that specialize in stablecoin payments, including Tron and Celo, among others.
While still a niche market segment, certain protocols specially related to AI agents may also benefit. On an infrastructure level, Autonolas and Wayfinder are building decentralized infrastructure for AI agents. Protocols like Virtuals, Aether, and MyShell are building consumer AI agent applications. This category is particularly nascent in its development but has grown its share of the AI theme pie in the past month.
Exhibit 3: AI Agent assets outperformed significantly in the past month
The integration of AI agents with blockchain technology represents more than just a novel use case for crypto — it signals a potential shift in how AI agents interact with money. Grayscale Research believes that the future of the internet could be increasingly dominated by AI-powered websites. Considering this, permissionless blockchains can potentially serve as the underlying infrastructure for AI agents integrated with these websites. If this becomes the case, AI agents may become a primary way of onboarding mass amounts of users into crypto without them even knowing they are using blockchain technology. As a result, AI agents pose the potential to greatly impact crypto adoption and development, making this emerging theme an important area to monitor going forward.
[2] The roots of AI agent research trace back to 1950s, although it wasn't until the 1980s that the term "agent" gained prominence in AI circles.
[3] Luna is powered by the Llama AI model – and one of Luna's most intriguing features is her ability to conduct financial transactions autonomously. This is made possible through a Coinbase MPC (Multi-Party Computation) wallet, where both Coinbase and the development team hold key shards, allowing Luna to make API calls for transactions seamlessly. Luna owns 5% of her namesake token, which is controlled by the team and gradually distributed to her.
[5] For illustrative purposes only
[9] For illustrative purposes only.
