Virtuals Protocol Research Report: Rapidly Creating Blockchain AI Agents

1. Project Overview

Virtuals Protocol was established in 2021 and is a blockchain-based AI agent generation platform. The project aims to enable anyone to create virtual characters that can interact with the environment, changing the way virtual interactions occur.

The project officially launched in 2023, with the core objective of achieving decentralized co-ownership of AI agents through Blockchain, promoting the widespread application of AI in fields such as gaming, entertainment, and the metaverse. The AI agents of Virtuals Protocol possess multimodal interaction capabilities and can operate seamlessly across multiple platforms.

2. Development History

2021: The predecessor of the project, PathDAO, was established, focusing on gaming guilds and GameFi investments.

2023: PathDAO officially transformed into Virtuals Protocol, focusing on the integration of AI and Blockchain, and deploying smart contracts on the Base chain.

2024: Launch of the first AI agent Luna, which has gained over 500,000 followers on social media platforms. Currently, more than 1,000 AI agents have been created on the platform.

End of 2024: Virtuals Protocol is launched on multiple exchanges, and the token $VIRTUAL's market value increases significantly in a short period.

3. Core Team

The team is composed of a group of young individuals with experience in consulting, Blockchain, AI, and gaming. The main members include:

• Jansen Teng: Co-founder and CEO, graduated from Imperial College London, previously worked at Boston Consulting Group.
• Wee Kee: Co-founder, holds a bachelor's degree from Imperial College London and a master's degree from London Business School.

Other team members mostly come from Southeast Asia, with backgrounds from prestigious universities and experience working in large enterprises.

4. Business Model

Virtuals Protocol adopts a decentralized operating model, based on Blockchain as its infrastructure. Users can create AI agents through a simple interface, and the platform charges fees based on the complexity of the agents. At the same time, the platform encourages developers to create derivative applications based on the protocol, collaborating through revenue sharing and other methods.

The ecosystem includes:

• Protocol Layer: Provides AI models and algorithms
• DApp Layer: Allows decentralized applications to integrate AI agent functions
• Contributor Network: Data contributors, validators, and developers earn rewards through contributions.

5. Token Economics

$VIRTUAL is the core token, with a total supply of 1 billion pieces, distributed as follows:

• 60%: Public circulation
• 35%: Ecosystem Treasury
• 5%: Liquidity Pool

The uses of the token include creating AI agents, paying service fees, and participating in protocol governance.

6. Industry Analysis

The AI agent industry is currently in a rapid development stage, with an average annual growth rate of 40%. It is expected that over the next 5 years, the market size will increase from $10 billion to $30 billion.

7. Competitor Analysis

1. AgentX: It has a large user base and corporate partnerships, but it uses a centralized architecture, which has limitations in terms of data privacy and ownership.

2. Altered State Machine ($ASTO): Focused on AI-driven NFT creation and training. There are gaps compared to Virtuals Protocol in decentralized governance and cross-platform integration.

3. Olas Network ($OLAS): Aiming to bridge the gap between AI and Blockchain, but the community size and influence are relatively small.

8. Development Plan

Short-term: Optimize user experience, lower technical barriers, increase user numbers, and enrich application scenarios.

Mid-term: Expand international markets, enhance project visibility, and strive to be listed on more mainstream trading platforms.

Long-term: Committed to becoming a global leading AI and Blockchain integrated ecological platform, achieving deep integration with multiple fields of the real world.

IX. Summary

Virtuals Protocol shows strong potential in the integration of AI agents and Blockchain. The project has a professional team, a solid technical foundation, and a clear development plan. The $VIRTUAL token has multiple uses and long-term appreciation potential.

Considering the industry's high growth expectations and project advantages, $VIRTUAL still has room for valuation increase in the long term. However, given the recent significant rise in market capitalization, investors are advised to act cautiously.

In the future, with the innovation of AI technology and the expansion of blockchain applications, Virtuals Protocol is expected to stand out in the industry transformation, bringing users a richer and more convenient digital life experience.