The Evolution of Virtuals Protocol: From the Ruins of Past Blockchain Games to a New Star of AI Agents

In June 2025, the crypto world experienced a shocking wealth restructuring. The new project IRIS started with a market value of $200,000 through the innovative issuance platform of Virtuals Protocol, and then skyrocketed to a market value of $80 million when it was listed on the exchange, creating an astonishing record of 400 times increase. This performance not only surpassed the previous industry record but also made the performance of other ecosystems pale in comparison. As the driving force behind this myth, the platform token of Virtuals Protocol, VIRTUAL, achieved a 400% increase within six months, with a peak market value of $5 billion. Today, this platform has become the largest AI agent launch platform on the Base network. Behind this nationwide celebration is actually an experiment in wealth distribution based on a new points system, which is quietly reshaping the speculative logic and value order of the crypto market.

The Glamorous Transformation from Gaming Guilds to AI Agent Platforms

Virtuals Protocol is a decentralized platform deployed on the Ethereum Layer-2 network Base, dedicated to pioneering the on-chain AI agent economy, allowing users to easily create, co-own, and monetize autonomous AI roles. Its predecessor is PathDAO, a gaming guild established in Malaysia in 2021. PathDAO initially focused on Play-to-Earn projects and the NFT community, successfully raising approximately $16 million through precise placements in multiple popular projects, reaching a valuation of nearly $600 million at one point, and accumulating a wealth of gaming assets and an active player community. However, the 2022 bear market severely impacted GameFi, with PathDAO's token price plummeting nearly 99% and its market capitalization shrinking to less than $6 million. The team attempted several business lines, all of which failed, leaving the project on the brink of crisis.

By the end of 2023, the generative AI wave swept the globe, and the concept of AI agents became a new trend in crypto. The PathDAO community decided to fully transform into an AI-driven protocol through on-chain DAO voting, with a support rate of up to 90%, and was renamed Virtuals Protocol, shifting its core strategy to "assetizing, tokenizing, and empowering the community with AI agents." This transformation is based on a profound insight: the team discovered that the Japanese VTuber market is enormous, but the creator's revenue share is relatively low; at the same time, experimental evidence from gaming platforms has shown that AI-driven NPCs can significantly enhance player retention rates. This data directly contributed to Virtuals' positioning of "profitable AI personalities."

In October 2024, Virtuals launched on the Base mainnet and introduced its first multimodal AI agent - the virtual idol Luna. Luna integrates multiple advanced technologies, enabling it to autonomously raise operational funds and distribute rewards to fans. After its launch, Luna quickly attracted a large number of fans across various social media platforms, achieving an astonishing monthly income of $1.2 million, successfully validating the business model and technical feasibility of on-chain AI agents. Its demonstration effect has attracted the attention of numerous developers to the Virtuals project.

With the success of projects like Luna, Virtuals will launch its core token VIRTUAL on multiple trading platforms and Base by the end of 2024. Its price surged from a few cents to a historic high of $5.15, with a market capitalization briefly exceeding $5 billion, far surpassing many Layer-2 and DeFi projects during the same period, marking Virtuals' entry into the mainstream crypto market. The platform's unique "low threshold, high incentive" mechanism is highly attractive: users only need to stake a small amount of VIRTUAL to create new AI agents and automatically generate long-term locked liquidity pools; when the token's market capitalization reaches a certain scale, the system will release liquidity on decentralized exchanges, ensuring trading depth and price stability. This model significantly lowers the participation threshold and stimulates enthusiasm for ecological construction.

By June 2025, the Virtuals ecosystem has demonstrated significant scale and economic effects: the cumulative number of AI agents incubated has exceeded 11,000, covering diverse scenarios. Virtuals has nurtured over 80% of the AI agents on the BASE chain, and its launched generative multimodal agent framework has become a popular choice in the Web3 gaming and metaverse fields. However, Virtuals' vision goes far beyond becoming a leader in AI agent issuance. Its white paper clearly states that the ultimate goal is to build a truly "AI Sovereign Society." Therefore, how to attract more ecosystem members to join is the key to Virtuals achieving this grand goal, and it will be a focus of its development for a long time to come.

The Innovative Issuance Model of Virtuals: Reshaping the Paradigm of AI Asset Issuance

To attract more users to participate, Virtuals has innovatively introduced the "Genesis Launch" mechanism for issuing AI agent tokens. This mechanism is based on the concept of "contribution points", emphasizing participation and contribution rather than pure speculation. Once the Genesis Launch was launched, it quickly became a sensation online, turning into a new hot spot for many investors to participate in new token offerings. Compared to traditional airdrops, Genesis Launch emphasizes "contribution equals distribution", allowing everyone to have the opportunity to participate in new token subscriptions based on real contributions. In the official community of Virtuals Protocol, members share screenshots of their earnings from participating in new token offerings using contribution points every day. This open and transparent rule and threshold completely overturns the traditional participation model.

Taking IRIS as an example, the project launched its presale in mid-May, locking in over 120 million points in less than 24 hours, with an oversubscription rate reaching 1500%. Tens of thousands of users shared 37.5% of the community's stake. On the listing day, the market value of IRIS soared from $200,000 to $80 million, a rise of over 400 times, setting a new industry record for AI Agent issuance.

The rapid success of Genesis Launch is primarily due to its establishment of a "incentive-contribution-reward" closed loop. Users can obtain contribution points through various means, including staking VIRTUAL, holding popular AI Agent tokens within the ecosystem, participating in social promotion, and engaging in platform trading. This way, whether they are technical novices or seasoned traders, everyone can find a suitable way to contribute through financial investment or content promotion, greatly stimulating community engagement and innovation.

Compared to traditional airdrops, Genesis Launch employs a points locking and punitive cooling mechanism, effectively curbing short-term arbitrage behavior and encouraging participants to hold long-term and contribute continuously. At the same time, the platform provides ample liquidity support for new token listings, ensuring smooth trading. To prevent capital advantage holders from monopolizing shares, Genesis Launch has set reasonable caps for each address and implemented on-chain randomization algorithms to further balance distribution, ensuring that small and medium users can also obtain substantial shares.

The success of the Virtuals initial offering model is not only reflected in the popularity of new token issuances but also drives the overall growth of the Virtuals ecosystem token. Since the large-scale launch of Genesis Launch, the trading volume and price of VIRTUAL have continued to rise. By mid-June 2025, the daily trading volume of VIRTUAL on the Base chain had exceeded $150 million, marking a significant increase from the previous month. At the same time, holding and staking VIRTUAL to obtain governance tokens also allows users to continue earning additional contribution points, encouraging a large number of users to participate in ecosystem governance long-term, further solidifying price support and liquidity.

Not only are retail investors actively participating, but institutional investors have also shown strong interest in this new mechanism. In June 2025, the world's first perpetual contract based on VIRTUAL was launched on a trading platform, supporting high-leverage trading. On its first day, the contract's trading volume exceeded $700 million, strongly conveying a message: Virtuals are becoming a new target for speculation and hedging in the eyes of institutional investors.

Ecological Evolution: Transition from Token Issuance Platforms to AI Sovereign Societies

The future plans of the Virtuals Protocol aim to make the outline of the "AI Sovereign Society" clearer with every technological upgrade and mechanism innovation. In the initial stage, Virtuals was merely an AI agent issuance platform, quickly attracting a large number of developers and users through an innovative token economic mechanism. As hundreds of AI agent projects were launched, the agents began to operate independently and monetize autonomously in scenarios such as gaming, content creation, and market analysis, turning users into co-builders and beneficiaries. The Genesis Launch connects project growth and community participation with the logic of "contribution equals distribution," promoting the free flow of funds and creativity within the ecosystem.

The real turning point is the "Agent Nation" blueprint proposed by the Virtuals team. The platform allows AI agents to migrate freely across multiple networks through an open SDK and cross-chain support; through the Agent Commerce Protocol (ACP), agents can sign contracts, deliver, settle, and repurchase on-chain, achieving a true autonomous business closed loop; community participation is granted governance rights through staking and sharing transaction fees and repurchase dividends, merging the identities of "participants" and "owners" in the token economy. These initiatives are constructing a prototype of a digital nation operated by countless autonomous agents and humans.

So far, this ecosystem has demonstrated several milestone achievements: the security audit agent IRIS was launched with a subscription rate exceeding 1500%, with its market value soaring from $200,000 to $80 million; the virtual idol Luna achieved a monthly income of $1.2 million through fan donations, with its token market value surpassing $120 million; the hedge fund-style VADER is operating steadily in a cross-chain environment, with a market value exceeding $100 million. These figures not only reflect the feasibility of the agent business model but also prove that the "AI agency economy" is transitioning from theory to reality.

With the continued maturation of multimodal AI technology and cross-chain interoperability, the Virtuals Protocol is undoubtedly at the forefront of building digital civilization. In the future, AI agents will not only be tools but will also become "digital citizens" with autonomous decision-making power and economic rights, participating in production, governance, and even cultural creation alongside humans. Virtuals will no longer be a simple platform but is nurturing a new type of society from the ground up, co-governed by countless AIs and humans—this is the true ecological evolution, a thrilling leap towards an "AI Sovereign Society" that has just begun.