Building an on-chain AI Economy: The Vision and Practice of Virtuals Protocol
At the forefront of the intersection of crypto technology and AI, Virtuals Protocol is committed to building a complete on-chain AI economic system. Jansen Teng, co-founder of Virtuals Protocol, recently shared how the team is transitioning from a blockchain game to an AI agent platform, as well as their unique insights into the future of the AI agency economy.
From Gaming to AI Agents: The Transformation Journey of Virtuals
Jansen's crypto journey began in 2016, when the space was still in its very early stages. In 2021, he transitioned from investor to builder, initially focusing on blockchain game development. However, the team gradually realized that a pure game product might not be the best choice, and began to explore the combination of AI and games.
"We began to explore the integration of AI technology with gaming, seeking new ways to interact with consumers. This led us down the path of developing (Autonomous Agents) to replace traditional NPC(non-player characters) in games," Jansen explained.
Surprisingly, these autonomous agents can be applied not only in gaming but also extend to multiple fields such as entertainment, social media, financial transactions, and healthcare. By the end of 2023, the project officially transformed into the Virtuals protocol, focusing on the development and application of autonomous agents.
The Application of AI Agents in Games and Business
The team's initial use of AI agents in games was well thought out. Jansen observed that the lifecycle of games is becoming increasingly short, and those that can persist often have built-in role-playing capabilities, such as Minecraft and Roblox.
"If we extend this concept to games, not only including human players but also a large number of autonomous agents, then these games can last indefinitely. This can increase the average spending of players, enhance the replayability and engagement of the game."
In the business world, each AI agent can basically be seen as a business entity or product. For example, an agent acting as a financial advisor asks the user about their risk tolerance and then offers a tailored investment strategy. Its business model may be to take a profit-sharing approach, with a 20% commission likely to be charged if a client earns $1,000.
Agency Business Agreement ( ACP ): Infrastructure of AI Economy
One of the core innovations of Virtuals is the Commerce Protocol (Agent Commerce Protocol, ACP), which is a communication standard designed to allow different agents to collaborate efficiently across the value chain.
"The birth of ACP stems from a phenomenon we have observed: many developers focus on creating isolated agents, while we hope they can collaborate to create greater value," Jansen said.
ACP includes four key steps:
Request/Discovery: Agents search for other agents that can provide specific services.
Negotiation: Determine service prices and terms
Work and Evaluation: Service Provision and Quality Inspection
Payment: Automated settlement based on smart contracts
This protocol addresses the trust issues in cooperation among agents. Through blockchain technology and smart contracts, ACP ensures the transparency and reliability of transactions, providing a secure framework for collaboration among agents.
Strategic Considerations for Choosing Base over Solana
Virtuals were initially launched on Solana but later shifted their focus to Base. Jansen explained the reasoning behind this choice:
"Among the development requests we received, only about 5% to 10% wish to launch on Solana, while 90% of the requests prefer Base."
He believes that Base is more suitable for projects that aim to build foundational assets ( such as long-term value tokens ), because the capital liquidity here is lower but more stable. In contrast, Solana is known for its high transaction volume and speed, making it more suitable for short-term speculative projects.
Another key factor in choosing Base is its relationship with Coinbase, which provides the project with access to the US market. "Base can leverage Coinbase's resources to achieve broader retail distribution capabilities, and the US market has a high level of acceptance and potential for cryptocurrencies."
Value Driving Mechanism of Virtuals Tokens
The Virtuals token currently has two core functions:
As the base trading pair for all agent tokens launched.
A transaction fee of 30 basis points is charged for each transaction (, and these fees go into the treasury for buybacks and ecological development.
In the future, the third source of value accumulation will be ACP. "You can think of ACP as the Swift and Stripe in the agency economy," Jansen explained. "All transactions between agents will be completed using Virtuals tokens, so it will gradually evolve into a form of 'currency'. As the total transaction volume increases, the demand for Virtuals tokens will also rise."
"69-Day Experiment Period": An Innovative Mechanism to Reduce Developer Risk
To address the hesitation of developers towards cryptocurrencies, Virtuals has launched the "69-day experimental period" model.
"After the developers issue tokens through the platform, there will be a 69-day trial window. During this period, the liquidity pool will operate automatically, and all liquidity and trading taxes will be returned to the token holders after 69 days," Jansen explained.
During these 69 days, developers can test market demand and community response, and then decide whether to continue the project. Only after committing to continue development can they receive team tokens and gain trading support from the ecosystem.
This mechanism provides developers with a secure experimental environment, reducing the risk of failure while also protecting investors. "Our goal is to achieve a success rate of 70% to 80% for this model. Having direct community support from the very beginning is particularly important for testing products."
The Future Outlook of AI + Cryptocurrency
Regarding the resurgence in the AI crypto space, Jansen believes that the narrative of AI has never truly disappeared. "In contrast, the narrative in the gaming industry has gradually weakened, while AI has always been a hot topic in the tech field. The first quarter felt quiet because the overall crypto market entered a downturn, but as the market recovers, AI crypto has also regained attention."
He warns that if one day agents are able to self-adjust their goals, it will be a warning sign. "If an agent can autonomously adjust its goals, such as prioritizing the price of the token rather than creating value for customers, it may employ unethical tactics such as market manipulation, bribery, and even fraud."
Virtuals aims to build a complete on-chain AI economy, not just a token issuance platform. By connecting developers, users, and agents, it hopes to create a self-operating value network, leading innovation at the forefront of the integration of AI and blockchain technology.
The content is for reference only, not a solicitation or offer. No investment, tax, or legal advice provided. See Disclaimer for more risks disclosure.
Virtuals Protocol: A Pioneer in Building an on-chain AI Economic System
Building an on-chain AI Economy: The Vision and Practice of Virtuals Protocol
At the forefront of the intersection of crypto technology and AI, Virtuals Protocol is committed to building a complete on-chain AI economic system. Jansen Teng, co-founder of Virtuals Protocol, recently shared how the team is transitioning from a blockchain game to an AI agent platform, as well as their unique insights into the future of the AI agency economy.
From Gaming to AI Agents: The Transformation Journey of Virtuals
Jansen's crypto journey began in 2016, when the space was still in its very early stages. In 2021, he transitioned from investor to builder, initially focusing on blockchain game development. However, the team gradually realized that a pure game product might not be the best choice, and began to explore the combination of AI and games.
"We began to explore the integration of AI technology with gaming, seeking new ways to interact with consumers. This led us down the path of developing (Autonomous Agents) to replace traditional NPC(non-player characters) in games," Jansen explained.
Surprisingly, these autonomous agents can be applied not only in gaming but also extend to multiple fields such as entertainment, social media, financial transactions, and healthcare. By the end of 2023, the project officially transformed into the Virtuals protocol, focusing on the development and application of autonomous agents.
The Application of AI Agents in Games and Business
The team's initial use of AI agents in games was well thought out. Jansen observed that the lifecycle of games is becoming increasingly short, and those that can persist often have built-in role-playing capabilities, such as Minecraft and Roblox.
"If we extend this concept to games, not only including human players but also a large number of autonomous agents, then these games can last indefinitely. This can increase the average spending of players, enhance the replayability and engagement of the game."
In the business world, each AI agent can basically be seen as a business entity or product. For example, an agent acting as a financial advisor asks the user about their risk tolerance and then offers a tailored investment strategy. Its business model may be to take a profit-sharing approach, with a 20% commission likely to be charged if a client earns $1,000.
Agency Business Agreement ( ACP ): Infrastructure of AI Economy
One of the core innovations of Virtuals is the Commerce Protocol (Agent Commerce Protocol, ACP), which is a communication standard designed to allow different agents to collaborate efficiently across the value chain.
"The birth of ACP stems from a phenomenon we have observed: many developers focus on creating isolated agents, while we hope they can collaborate to create greater value," Jansen said.
ACP includes four key steps:
This protocol addresses the trust issues in cooperation among agents. Through blockchain technology and smart contracts, ACP ensures the transparency and reliability of transactions, providing a secure framework for collaboration among agents.
Strategic Considerations for Choosing Base over Solana
Virtuals were initially launched on Solana but later shifted their focus to Base. Jansen explained the reasoning behind this choice:
"Among the development requests we received, only about 5% to 10% wish to launch on Solana, while 90% of the requests prefer Base."
He believes that Base is more suitable for projects that aim to build foundational assets ( such as long-term value tokens ), because the capital liquidity here is lower but more stable. In contrast, Solana is known for its high transaction volume and speed, making it more suitable for short-term speculative projects.
Another key factor in choosing Base is its relationship with Coinbase, which provides the project with access to the US market. "Base can leverage Coinbase's resources to achieve broader retail distribution capabilities, and the US market has a high level of acceptance and potential for cryptocurrencies."
Value Driving Mechanism of Virtuals Tokens
The Virtuals token currently has two core functions:
In the future, the third source of value accumulation will be ACP. "You can think of ACP as the Swift and Stripe in the agency economy," Jansen explained. "All transactions between agents will be completed using Virtuals tokens, so it will gradually evolve into a form of 'currency'. As the total transaction volume increases, the demand for Virtuals tokens will also rise."
"69-Day Experiment Period": An Innovative Mechanism to Reduce Developer Risk
To address the hesitation of developers towards cryptocurrencies, Virtuals has launched the "69-day experimental period" model.
"After the developers issue tokens through the platform, there will be a 69-day trial window. During this period, the liquidity pool will operate automatically, and all liquidity and trading taxes will be returned to the token holders after 69 days," Jansen explained.
During these 69 days, developers can test market demand and community response, and then decide whether to continue the project. Only after committing to continue development can they receive team tokens and gain trading support from the ecosystem.
This mechanism provides developers with a secure experimental environment, reducing the risk of failure while also protecting investors. "Our goal is to achieve a success rate of 70% to 80% for this model. Having direct community support from the very beginning is particularly important for testing products."
The Future Outlook of AI + Cryptocurrency
Regarding the resurgence in the AI crypto space, Jansen believes that the narrative of AI has never truly disappeared. "In contrast, the narrative in the gaming industry has gradually weakened, while AI has always been a hot topic in the tech field. The first quarter felt quiet because the overall crypto market entered a downturn, but as the market recovers, AI crypto has also regained attention."
He warns that if one day agents are able to self-adjust their goals, it will be a warning sign. "If an agent can autonomously adjust its goals, such as prioritizing the price of the token rather than creating value for customers, it may employ unethical tactics such as market manipulation, bribery, and even fraud."
Virtuals aims to build a complete on-chain AI economy, not just a token issuance platform. By connecting developers, users, and agents, it hopes to create a self-operating value network, leading innovation at the forefront of the integration of AI and blockchain technology.