Cointime

Cointime

Download App
iOS & Android

AgentFi - A New AI Powered Narrative is About to Take Over DeFi

Validated Project

Author: Ketzalco

Reviewer: Kyle

A new AI powered narrative is about to take over DeFi and it will radically change how crypto markets operate forever.

Agent Driven Finance will soon be a reality and its impact on the industry will be so deep, it's yet hard to imagine.

But what is meant by AgentFi?

AgentFi, Autonomous Finance, Agentic protocols...

These are a few names we've encountered that attempt to define the same idea.

They all describe a future where AI agents will be able to access defi markets and execute profit strategies without oversight from human actors.

At first, AgentFi is a simple and obvious idea, but let's explore it's attributes and how it comes to materialize.

@aothecomputer recently posted this and it got us to think on the inevitable shift of the current DeFi space into a trustless, autonomous agent driven market.

Twitter Link：https://twitter.com/aoTheComputer/status/1775275941935378909?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1775275941935378909%7Ctwgr%5E%7Ctwcon%5Es1_c10&ref_url=notion%3A%2F%2Fwww.notion.so%2Fpermadao%2FAgentFi-AI-DeFi-d218aab108c14699a14d0f190305caa5

What is AgentFi？

DeFi has disrupted financial markets by making them permissionless and open.

Primitives such as asset swapping, lending, etc can now be performed in a trustless manner from anywhere with an internet connected device.

All thanks to robust smart contracts.

However, DeFi lacks an intelligence layer where bots can make sophisticated market decisions.

Currently, bots can be programmed to act upon some data events.

AgentFI refers to a world where bots create and adapt complex strategies akin to human agents such as fund managers.

The first question that comes to mind is: what does it mean that AgentFi builds on top of Defi primitives?

To answer this, we need to know how defi currently operates and explore how autonomous agents are different from bots that currently operate across DeFi protocols.

AGENTFI vs DEFI

There are two key differences that set AgentFi apart from Defi and open up a new range of possibilities for trading markets.

  1. The type of data upon which bots may act.
  2. The ability of an AI agent to act proactively beyond predetermined configurations.

Currently, the data available across DeFi is quantitive.

It's a stream of raw prices that update according to events such as news or changes in liquidity.

Defi bots monitor these price changes and execute strategies based on preconfigured parameters set by their owners.

These bots require lots of oversight precisely because they lack intelligence.

If market conditions should change, there is greater risk of them becoming unprofitable.

They can only react to preset data triggers. They can't "wake up" and update their strategies proactively.

The difference with autonomous agents is that they will have the ability to access and interpret not only quantitative data, but qualitative as well.

So instead of only reacting to price changes, agents will be able to interpret the information that is hidden behind numbers.

Agents will be able to read into the contents of a speech of an announcement.

They will also interpret facial expressions of the speakers or the tone of news articles.

They'll combine this with real time number data and use everything as input to update their strategies.

But Defi doesn't have reliable access to qualitative data, so where will it come from? That is the magic that is only possible by having @aothecomputer built on top of @arweaveEco . Arweave is a storage layer for all kinds of data, not only raw price feeds from oracles.

There is no limit to the data that can be uploaded onto @arweaveeco . And since processes on @aothecomputer can consume data from Arweave, AI agents built on AO get access to a whole new dimension of data for their Defi operations. This is like adding sound to movies.

Autonomous agents will have the power to read the intricacies of information that is not provided by prices. In other words, they will gain the ability to operate with a new degree of intelligence that goes beyond numbers. Their strategies will be enabled by LLMs on AO.

Even further, the system design in @aothecomputer allows for these agents to "wake up" automatically. Compare this to an MEV bot on Ethereum. It is constantly monitoring transactions until there is an MEV opportunity. The bot tries to react as fast as possible to exploit it.

On @aothecomputer , an autonomous agent can be set to act proactively beyond the limit of some preset parameters. Combine this with a sophisticated financial AI as engine, and you get an unstoppable 24/7 trading agent that learns and adapts to ever changing market conditions.

All that is needed to make this possible is an upstream of live reliable data to @Arweaveeco , and every process in AO can add them to their inputs. AgentFi will create a world of opportunities in Defi. Just thinking about these agents is enough to make one's head explode.

Imagine a world where AI agents can adopt the strategies of the most successful traders. Now imagine you can bet on them by funding their operations on a defi app - Warren Buffet vs Jim Simmons vs Simon Cawkwel.

It's survival of the fittest on a 24/7 live trading arena.

Twitter Link：https://twitter.com/samecwilliams/status/1777747121011122367?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1777747121011122367%7Ctwgr%5E%7Ctwcon%5Es1_c10&ref_url=notion%3A%2F%2Fwww.notion.so%2Fpermadao%2FAgentFi-AI-DeFi-d218aab108c14699a14d0f190305caa5

So TLDR on how AgentFi builds on top of DeFi:

Current Defi Bots:

- reactive

- unintelligent

- limited to quantitative data

- need constant oversight

Autonomous Financial Agents:

- proactive

- intelligent

- adaptive learning on qualitative data

- open ownership possible

There are still some questions on how this thesis might unfold. There might be risks and consequences that we don't yet consider due to the excitement around an AgentFi narrative. For now, all we can do is prepare for this shift. It's coming soon on @aothecomputer .

As reference, also check out this awesome article on Agentic Protocols by @goodalexander . It served as inspiration for this post. We'll delve deeper into these ideas soon.

Twitter Link：https://twitter.com/goodalexander/status/1777031082098991300?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1777031082098991300%7Ctwgr%5E%7Ctwcon%5Es1_c10&ref_url=notion%3A%2F%2Fwww.notion.so%2Fpermadao%2FAgentFi-AI-DeFi-d218aab108c14699a14d0f190305caa5

🔗 More about PermaDAO ：Website | Twitter | Telegram | Discord | Medium | Youtube

💡 Initiated by everVision and sponsored by Forward Research (Arweave Official), PermaDAO is a "Cobuilding Community" focus on the theme of Arweave consensus storage. All contributions from PermaDAO contributors form the bedrock of data consensus. Let's embark on a journey starting with data consensus and delve into a novel paradigm for decentralized collaboration - Decentralized Autonomous Organizations (DAOs)!

“Debug" Program:

If you find errors in this article, including typos, grammatical mistakes, incorrect descriptions, ambiguous meanings, redundant descriptions, or other problems, you can give us feedback and we will be rewarded with incentives. Click "here" to give feedback.

Comments

All Comments

Recommended for you

  • A whale sold 224 WBTC worth $14.4 million in the past three hours

    According to on-chain analyst @ai_9684xtpa, address 0x486...1505e sold 224 WBTC tokens worth $14.4 million through Cowswap in the past three hours, making a profit of $830,000 (selling at an average price of $64,203). The seller had bought 371 WBTC tokens at an average price of $60,504 between November 2023 and April 2024, and still holds 280 WBTC tokens.

  • CryptoQuant CEO: BTC needs to remain above $80,000 for miners to remain profitable after halving

    Bitcoin mining revenue significantly decreased in May due to the impact of the fourth Bitcoin halving event. On May 1st, the total revenue from block rewards and transaction fees reached a new low of only $26.3 million.CryptoQuant CEO Ki Young Ju calculated that, based on current conditions, Bitcoin needs to stay above $80,000 for miners to remain profitable after the halving. However, most miners have taken proactive measures to upgrade their mining equipment to lower long-term operating costs and remain competitive.

  • BTC returns to above 65,000 USDT, up 2.08% in 24 hours

    OKX market shows that BTC has returned to above 65000 USDT, now reporting 65102 USDT, with a 24-hour increase of 2.08%.

  • Hundre Finance attackers have withdrawn 162.2 ETH worth of crypto assets from Curve

    According to PeckShield monitoring, the attacker of Hundre Finance withdrew 784,000 3Crv from Curve and exchanged it for 273 ETH. In addition, they also exchanged 305.6 WOO, 39 PAXG, 200,000 FRAX, and 100,000 DAI, totaling 162.2 ETH. The attacker then bridged 1,034 ETH (2.17 million USD), 842.8K DAI, 1.11 million USDT, 1.27 million USDC, and 457.3 FRAX from Optimism to Ethereum. They also exchanged a total of 480,000 USDC for 142.6 WETH, 306 WOO, and 39 PAXG. They also exchanged 1.11 million USDT for 500.3 thousand USD worth of DAI and 613.8 thousand USD worth of FRAX. Additionally, on April 15, 2023, approximately 786,000 USD worth of USDC was added to Curve3Pool.

  • LayerZero co-founder: "Self-reporting of witch activities" is not aimed at individuals, but at industrial witch studios

    Bryan Pellegrino, co-founder and CEO of LayerZero, stated on social media that the "Self-Report Sybil Activity" is not targeting individual users, but rather large industrial witch farms (studios).Earlier, LayerZero Labs launched the "Self-Report Sybil Activity" plan, which allows witch addresses to self-report related addresses on a designated page and receive an expected allocation of 15%, without answering any questions. The deadline is May 17th, 19:59:59.

  • Argentina’s House of Representatives Passes Bill to Regularize Cryptocurrency Taxation

    The Argentine Chamber of Deputies has passed a cryptocurrency tax normalization bill aimed at advancing a series of important government reforms. The bill introduces the possibility of regularizing previously undeclared cryptocurrency assets, up to a maximum of $100,000, without paying government collection fees. However, if the value of cryptocurrency assets exceeds this limit, the government will apply preferential tax rates based on the taxpayer's declaration date.

  • GNUS on Fantom was attacked, with a loss of about $1.27 million

    According to Beosin's monitoring, GNUS on Fantom was attacked, resulting in a loss of approximately $1.27 million. GNUS stated on the X platform that due to recent vulnerabilities, hackers were able to mint fake GNUS tokens on Fantom, transfer them to Ethereum and Polygon through the Axelar Bridge, and sell them to existing liquidity pools. We will take a snapshot of the blocks before the exploit. To ensure fairness, please do not purchase GNUS tokens after the exploit, as we will issue new tokens.

  • Pandu Financial Group received the first round of strategic equity investment of tens of millions of Hong Kong dollars, led by Longling Capital

    Pando Financial Group announced it has received tens of millions of Hong Kong dollars in strategic equity investment led by Longling Investment. Pando Financial Group stated that it plans to use the newly injected funds for key growth areas, including market expansion, innovative product development, key talent recruitment, and technology upgrades, aiming to accelerate the layout of opportunities in the era of virtual assets through these strategic initiatives. Currently, the group's asset management scale has reached $500 million. Pando Asset, a subsidiary of Pando Financial Group, established its headquarters in Zurich in 2022 and issued the Pando 6 spot virtual asset fund (Bitcoin/Ethereum spot ETPs) on the Swiss Exchange. Another subsidiary of Pando Financial Group, Pando Limited, obtained licenses from the Securities and Futures Commission in Hong Kong, including Type 1 (securities trading), Type 4 (advising on securities), and Type 9 (asset management), as well as public fund qualifications, and was approved to manage investment portfolios with more than 10% invested in virtual assets and issued several excellent performance actively managed ETF products.

  • Hong Kong Monetary Authority launches industry consultation on “renaming virtual banks as licensed digital banks”

    Hong Kong virtual banks released their annual reports for 2023 last week. The eight virtual banks collectively lost about 2.99 billion yuan last year, a decrease of about 12% compared to the total loss of about 3.4 billion yuan in 2022. In response to the occasional feeling of "unreality" brought about by the term "virtual" in recent years, the Hong Kong Monetary Authority has initiated a consultation on renaming with the eight virtual banks, the Hong Kong Bankers Association, the Hong Kong Restricted Licensed Banks and Deposit-taking Companies Association, with the aim of renaming virtual banks as licensed digital banks, for a period of one month. It is reported that in the Asian region, similar banks have different names in different places. South Korea and Singapore issue licenses under the name of "digital bank", with Singapore further dividing them into digital full banks (DFB) and digital wholesale banks (DWB).

  • Chairman of the Russian State Duma Financial Market Committee: I do not support a complete ban on the circulation of cryptocurrencies in Russia

    Anton Gorelkin, Chairman of the Financial Market Committee of the Russian State Duma, said that he does not support a complete ban on the circulation of cryptocurrency in Russia. He explained in a post on Telegram that this restriction is not intended to ban the use of all cryptocurrencies, but rather to regulate the establishment of cryptocurrency exchange platforms within the legal framework of Russia. Anton Gorelkin also believes that the establishment of a legitimate cryptocurrency infrastructure in Russia is influenced by geopolitical realities, and this requires consideration of factors related to international relations. He further added that allowing such infrastructure may expose Russian companies to Western sanctions. In addition, Anton Gorelkin pointed out that this restriction may be lifted in the future, and users can still use foreign cryptocurrency exchanges and over-the-counter trading services as before. However, the impact on many over-the-counter cryptocurrency services in Moscow is still uncertain.

Daily Must-Read

Popular Activities

Delysium $AGI & AI Private Yacht Party

Delysium $AGI & AI Private Yacht Party

March 27 - March 27
Seoul

Popular Tags

Cointime
News
Contents
RSS
Company