The rise of AI-driven crypto agents is following a familiar trajectory that mirrors the initial boom, bust and resurgence of ICO-era projects. Just as early blockchain ventures thrived on hype before maturing into sustainable ecosystems, the current wave of AI agent projects is undergoing rapid market shifts. 

A new report by HTX Ventures and HTX Research says that investors are growing cautious as competition in the sector intensifies, liquidity disperses and many projects struggle to define clear use cases. Still, as the sector moves beyond its speculative phase, AI-driven crypto agents are expected to evolve sustainable business models underpinned by genuine utility.

To dive deeper into the evolution of crypto agents and the future of AI-driven blockchain innovation, download the full report by HTX here.

From meme hype to reality: The evolution of crypto agents

The initial wave of crypto agent projects in 2024 was driven by indiscriminate enthusiasm for AI projects. Following the impact of a $50,000 Bitcoin donation from Marc Andreessen in October 2024 and the success of token launchpads earlier in the year, many AI agent projects entered the space in Q1 of 2024 and rapidly diluted liquidity by Q1 of 2025. As with any emerging sector, early-stage hype did not always translate into long-term viability, and a cooling-off period in the crypto AI agent sector followed.

The market segment is now entering a more mature phase, and the focus is shifting from speculative excitement to revenue generation and product performance. The winners in this evolving landscape will be those that can generate stable revenue, cover the costs of running AI models and provide tangible value to users and investors alike.

AI agent applications emphasize real-world implementation and commercialization of this technology, particularly in areas like automated trading, asset management, market analysis and crosschain interaction. This approach aligns with multi-agent systems and DeFAI (decentralized finance + AI) initiatives like Hey Anon, GRIFFAIN and ChainGPT.

Recent research highlights the advantages of multi-agent systems (MAS) in portfolio management, particularly in cryptocurrency investments. Projects such as Griffain, NEUR, and BUZZ have already demonstrated how AI can help users interact with DeFi protocols and make informed decisions. Unlike single-agent AI models, multi-agent systems leverage collaboration among specialized agents to enhance market analysis and execution. These agents function in teams, such as data analysts, risk evaluators and trading execution units, each trained to handle specific tasks. 

MAS frameworks also introduce inter-agent communication mechanisms, where agents within the same team refine predictions through collective learning, reducing errors in market trend analysis. The next phase of DeFAI will likely involve deeper integration of decentralized governance models, where multi-agent systems participate in protocol management, treasury optimization and onchain compliance enforcement.

To dive deeper into the evolution of crypto agents and the future of AI-driven blockchain innovation, download the full report by HTX here.

DeepSeek-R1: A breakthrough in AI agent training

A breakthrough in AI agent technology arrived with DeepSeek-R1, an innovation that challenges traditional AI training methods. Unlike previous models, which relied on supervised fine-tuning (SFT) followed by reinforcement learning (RL), DeepSeek-R1 takes a different approach, optimizing entirely through reinforcement learning without an initial supervised phase. This shift has led to remarkable improvements in reasoning capabilities and adaptability, paving the way for more sophisticated AI-driven crypto agents.

To understand this paradigm shift, consider two different approaches to learning. In the Traditional SFT and RL model, a student first studies from a workbook, practicing problems with set answers (SFT), and then receives tutoring to refine their understanding (RL). In contrast, with the DeepSeek-R1 Model (Pure Reinforcement Learning), the student is thrown directly into an exam and learns through trial and error. This approach allows the student to improve dynamically based on feedback rather than relying on pre-defined answers.

Leveraging DeepSeek-R1’s pure RL model, AI agents learn through trial and error in real-world conditions, dynamically adjusting their strategies based on immediate feedback.

This method allows for greater adaptability, making it particularly useful for multi-agent AI systems in DeFi, where real-time market fluctuations require agents to make autonomous, data-driven decisions​. For example, AI-powered agents can monitor liquidity pools, detect arbitrage opportunities and optimize asset allocations based on real-time market conditions. These agents adapt quickly to market fluctuations, ensuring more efficient capital deployment.

Launched in late November 2024, iDEGEN is the first crypto AI agent built on DeepSeek R1. This integration of DeepSeek’s R1 model emphasizes how crypto AI agents can inherit such enhanced reasoning capabilities, competing with other established AI models at a fraction of the cost.  

This shift toward RL-powered, multi-agent AI in DeFi automation underscores why closed-source AI models (such as OpenAI’s GPT-based systems) are becoming an unsustainable expense. With workflows often requiring the processing of 10,000+ tokens per transaction, closed AI models impose significant computational costs, limiting scalability. In contrast, open-source RL models like DeepSeek-R1 allow for decentralized, cost-efficient AI development tailored for DeFi applications​.

The future of AI agents in Web3

The key to longevity in this sector lies in continuous innovation, adaptability and cost efficiency. Open-source AI models like DeepSeek-R1 are lowering the barriers to entry, allowing blockchain-native startups to develop specialized AI solutions. Meanwhile, advancements in DeFAI and multi-agent systems will drive long-term integration between AI and decentralized finance. 

The takeaway is clear: Projects must prove their value beyond hype. Those who develop sustainable economic models and leverage cutting-edge AI advancements will define the future of intelligent blockchain ecosystems. The ICO era of crypto agents is evolving, and the next wave of winners will be the ones that can turn innovation into long-term viability.

To dive deeper into the evolution of crypto agents and the future of AI-driven blockchain innovation, download the full report by HTX here.

Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you with all important information that we could obtain in this sponsored article, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor can this article be considered as investment advice.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Cointelegraph does not endorse the content of this article nor any product mentioned herein. Readers should do their own research before taking any action related to any product or company mentioned and carry full responsibility for their decisions.

Opinion by: Hatu Sheikh, founder of Coin Terminal

Crypto began its journey with Bitcoin (BTC) — the epitome of decentralization — promising open access and equitable distribution of financial resources. It evolved into starkly different territories, where lucrative market opportunities are often inaccessible for retail investors.

Wealthy individuals, high-net-worth family offices, company insiders and venture capitalists secure early access to prime crypto deals. Retailers are left in the lurch as their late entry leads to higher market risks and limited profitability.

The table is turning, mainly with the rise of real-world asset (RWA) tokenization and a decisive repudiation of venture capital-backed tokens. Crypto is no longer a niche asset class for institutional investors — retail users are now actively shaping the future of finance.

Crypto has a retail-institutional divide

Retail investors have long stayed away from the crypto market. Analyzing the Bitcoin wallet activities of retail tokenholders demonstrates this.

According to Glassnode, Bitcoin retail spend volumes of user wallets holding less than 0.1 BTC have dropped by 48% since November 2024. A crypto commentator has corroborated the data, showing retail interest reached a three-year low.

Institutional investors like Metaplanet, Strategy and Intesa Sanpaolo have recently increased their Bitcoin holdings, taking advantage of BTC’s price drop. Simultaneously, large Bitcoin holders or crypto whales have accumulated over 39,620 BTC worth $3.79 billion in a single day.

Matt Hougan, chief investment officer at Bitwise, said, “There is an absolutely massive disconnect between retail and professional sentiment in crypto right now.” The data suggests that retail sentiment is bearish while professional investors remain bullish, almost like two parallel worlds.

The expanding adoption of BTC reserves by corporations and institutional demand for Bitcoin futures has led to shrinking retail investors. The Chicago Mercantile Exchange (CME) controls 85% of the monthly futures market, while crypto exchanges control retail-led perpetual contracts.

CME’s open interest in monthly BTC futures offers hedge funds and investment banks exposure to BTC and liquidity access. It also indicates, however, a diminishing influence of retail investors’ participation in Bitcoin’s price discovery.

The market structurally restricts retail investors’ access to capital reserves, denying them early-stage opportunities in financial markets. The psychological “unit bias” adds to the problem as retailers cannot own a complete unit of assets like Bitcoin.

Recent: Crypto shows how powerful tokenizing private stocks would be

As governments contemplate the formation of strategic Bitcoin reserves, they risk being locked in central bank cold wallets. For optimal utilization, it’s essential to keep Bitcoin accessible to retail investors through open reserves.

Despite such constricted market opportunities, the crypto industry offers innovative products like asset tokenization and memecoins to democratize access for retail investors.

Retail investors are reclaiming crypto

Sometimes, the best way to achieve financial inclusion is to remove complexities and make investing fun and relatable. Memecoins have done that successfully, leveraging speculation as a utility to make a statement against low-float-high-fully diluted valuation coins backed by VCs. That’s the reason retail investors are buying memecoins in such large numbers.

Although memecoins are subject to severe market volatily, they continue to dominate retail speculation. Nicolai Søndergaard, a research analyst at Nansen, thinks the altcoin season is yet to come because memecoins have topped investor mindshare and capital allocation. 

The memecoin phenomenon shows the power of ordinary people to monetize virality and harness mimetic desire through collective community-led wealth generation. But more importantly, it shows retail investors’ rejection of VC-led token pumps that deny fair entry to high-value token launches.

Memecoins also give tokenholders a sense of belonging to facilitate bonding over shared values and culture. Thus, when US President Donald Trump launched his memecoin, 42% of investors were first-time buyers, signaling memecoins’ potential to onboard retailers.

Beyond speculative memecoin trading, retail investors adopt tokenized real-world assets to hedge against uncertain market conditions. The RWA tokenization market has recently surpassed $17 billion, enhancing retail investor accessibility and market opportunities through improved liquidity and fractional ownership.

Retailers and small investors can now participate in tokenized capital markets, previously reserved for institutions and wealthy individuals. Thus, tokenization is a democratic and inclusive market strategy to help new investors access the financial system without facing liquidity challenges.

Mastercard recently published a white paper explaining how RWA tokenization offers significant socio-economic benefits to people from emerging economies, such as Latin America. In developing economies, tokenization resolves the trust deficit by enabling transparent ownership tracking for seamless asset transfers.

Asset tokenization helps retail investors participate in DeFi markets by improving capital efficiency. A PricewaterhouseCoopers report shows tokenization benefits buyers and sellers in the opaque $1.5-trillion private credit market through fractionalized lending and borrowing.

Amid turbulent market conditions, institutional investors with abundant capital reserves have the luxury of continuing to accumulate Bitcoin and other altcoins. However, retail investors with a fixed capital supply must find asset classes with the lowest entry barriers.

With the crypto industry providing diversified investment options and innovative products, retailers now have the freedom to invest in their preferred assets. It’s finally time for retail investors to come onchain.

Opinion by: Hatu Sheikh, founder of Coin Terminal.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

XRP and Solana led all altcoin-based exchange-traded product (ETP) inflows during the week ending March 21, with $6.71 million and $6.44 million respectively, according to digital asset investment firm CoinShares.

Other altcoin inflows were comparatively modest, with Polygon (MATIC) logging $400,000 and Chainlink (LINK) adding $200,000.

Sentiment toward altcoins remained mixed overall, as Ether (ETH) alone saw significant outflows totaling $86 million. Other notable outflows included Sui (SUI), with $1.3 million, Polkadot (DOT), with $1.3 million and Tron (TRX) with $950,000.

Despite Ether’s substantial outflows dragging down the altcoin sector, digital assets collectively reversed a five-week streak of net outflows, registering inflows of $644 million. Bitcoin (BTC) led this recovery with inflows amounting to $724 million, snapping its own five-week negative streak.

Ethereum outflows pull down altcoins ETP performance, but Bitcoin carries digital assets. Source: CoinShares

As Cointelegraph reported, Ethereum has now experienced net weekly outflows for four consecutive weeks, while Bitcoin recorded its largest net inflow since January.

Related: Bitcoin ETFs log first net inflows in weeks, while Ether outflows continue

Sentiment on digital assets ETPs shifting across the world

CoinShares noted that the majority of inflows originated from the US, which accounted for $632 million, driven primarily by BlackRock’s iShares Bitcoin Trust (IBIT). 

Positive sentiment, however, extended beyond the US, with Switzerland leading other regions at $15.9 million, followed closely by Germany ($13.9 million) and Hong Kong ($1.2 million).

Canada and Sweden lead outflows. Source: CoinShares

Stars lining up for Solana and XRP

Although altcoins collectively suffered a net outflow driven primarily by Ethereum’s performance, Solana and XRP emerged as the standout altcoin performers.

In Solana’s case, the US market is poised to introduce its first Solana futures exchange-traded funds (ETF), potentially paving the way for a future spot Solana ETF.

Related: XRP and Solana race toward the next crypto ETF approval

In Bitcoin’s case, the approval of futures-based ETFs was initially favored by regulators due to the existence of a regulated market (the Chicago Mercantile Exchange), which provided assurances against potential market manipulation. However, this raised controversy over the SEC’s continued rejection of spot Bitcoin ETFs, which directly hold the cryptocurrency. 

A pivotal lawsuit by Grayscale successfully challenged this inconsistency, compelling the SEC to revisit its stance and ultimately paving the way for approval of the long-awaited spot Bitcoin ETFs.

Meanwhile, XRP has seen a significant boost from the recent dismissal by the SEC of its long-running lawsuit against Ripple Labs.

Magazine: Memecoins are ded — But Solana ‘100x better’ despite revenue plunge