Virtuals Protocol: The Transformation from Game Remnants to an AI Agent Platform

In June 2025, the crypto world witnessed a wealth migration: the new project IRIS debuted on the Genesis Launch platform of Virtuals Protocol with an initial market value of $200,000, and after its launch, the market value skyrocketed to $80 million, setting a new record with a 400-fold increase. This performance far exceeded previous increase records, making many ecosystems pale in comparison. As the driving engine of this myth, the platform token VIRTUAL of Virtuals Protocol achieved a 400% increase within six months, with a peak market value surpassing $5 billion. Today, this platform has become the largest AI agent launch platform on a certain network. Behind this nationwide celebration is, in fact, an experiment in wealth distribution based on point rules, quietly reshaping the speculative logic and value order of the crypto market.

From Game Remnants to AI Intelligent Agent Platform Transformation

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

By the end of 2023, the wave of generative AI swept the globe, and the concept of AI agents became a new trend in cryptocurrency. The PathDAO community decided to completely transform into an AI-driven protocol through on-chain DAO voting and rebranded as Virtuals Protocol, shifting its core strategy to "assetizing, tokenizing AI agents, and empowering the community." This transformation is based on profound insights: the team discovered that the Japanese VTuber market is enormous, yet creators only receive a small share of the profits; at the same time, experiments on a certain platform proved that AI-driven NPCs could increase player retention rates by about threefold. These two pieces of data directly led to the positioning of Virtuals as "profitable AI personas."

In October 2024, Virtuals launched on the mainnet, introducing the first multimodal AI agent - the virtual idol Luna. Luna integrates technologies such as text generation, 3D motion, voice synthesis, and smart contract wallets, enabling her to autonomously raise operational funds and distribute rewards to fans. After launch, Luna quickly gained 500,000 followers on social media, and her monthly income from fan donations reached $1.2 million, successfully validating the business model and technical feasibility of on-chain AI agents. Its demonstration effect attracted a large number of developers' attention to the Virtuals project itself.

Riding on the success momentum of projects like Luna, Virtuals will launch its core token VIRTUAL on multiple platforms by the end of 2024. Its price skyrocketed from a few cents to a historic high of $5.15, with its market cap temporarily exceeding $5 billion, far surpassing most 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 about 10 VIRTUAL (approximately $200) to create a new AI agent and automatically generate a liquidity pool locked for 10 years; when the token's market cap reaches around $500,000, the system will release the liquidity layer to ensure trading depth and price stability. This model significantly lowers the participation threshold and stimulates enthusiasm for ecological development.

By June 2025, the Virtuals ecosystem has demonstrated significant scale and economic effects: the cumulative number of AI agents incubated exceeds 11,000, covering diverse scenarios such as virtual idols, trading advisors, game engines, and content incubation. Virtuals has nurtured over 80% of the AI agents on this chain, and its generative multimodal agent framework G.A.M.E has also become a popular choice for agents in the Web3 gaming and metaverse sectors. However, Virtuals' vision goes far beyond becoming the leader in AI agent issuance. Its white paper clearly states that the ultimate goal is to build a true "AI sovereign society." Therefore, attracting 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.

Virtuals New Issuance Model: Creating a New Paradigm for AI Asset Issuance

To attract more user attention, Virtuals has innovatively introduced the "Genesis Launch" mechanism for the issuance of AI agent tokens. Unlike traditional linear airdrops or fixed issuances, Genesis Launch is based on the concept of "contribution points (Virgen Points)", emphasizing participation and contribution rather than pure speculation. Once launched, Genesis Launch quickly became a sensation across the internet, and Virtuals has emerged as a new hotspot for many investors vying to participate in new token launches, with even seasoned speculators discussing how it might replace the once-popular "Alpha airdrop" model. Unlike traditional airdrops that distribute tokens in one go, often leading users to sell immediately, Genesis Launch emphasizes "contribution equals distribution", allowing everyone the opportunity to participate in new token subscriptions based on real investment. Almost daily, members in the official Virtuals Protocol community share screenshots of their earnings from participating in new launches using Virgen Points, completely overturning the situation of "wealthy individuals monopolizing, while retail investors are left out" with its open and transparent rules and thresholds.

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 a subscription overshoot of 1500%. Tens of thousands of users shared 37.5% of the community share. On the day of its listing, the market value of IRIS soared from $200,000 to $80 million, an increase of over 400 times, setting a new industry record for AI Agent issuance, which also made the previous "shitcoin season" of a certain ecosystem suddenly dim.

The reason why Genesis Launch was able to rapidly gain popularity lies in its construction of a "incentive-contribution-reward" closed loop. First, users can earn basic Virgen Points by staking VIRTUAL or holding the highly sought-after AI Agent tokens within the ecosystem, such as Luna and AIXBT; secondly, users can accumulate more points by participating in social promotion ("Yapping"), trading on the platform, or staking other project tokens. In this way, whether you are a novice or an experienced trader, you can find a suitable way to contribute through financial investment or content promotion, greatly stimulating community activity and innovative motivation.

In stark contrast, traditional airdrops often rely solely on coin snapshots or the completion of complicated tasks, and most users sell the coins they receive on the same day. According to data, over 90% of airdropped tokens see a significant price drop within 15 days of issuance, with a retention rate of less than 12% after three months. In contrast, Genesis Launch employs a points lock-up and punitive cooling mechanism: if the newly acquired tokens are sold within 24 hours of unlocking, it will trigger a 10-day points reset, greatly curbing the arbitrage activities of "sheep shearing" participants and encouraging them to hold long-term and make continuous contributions.

At the same time, the platform provides ample liquidity support for the listing of new tokens. Each Agent Token is paired with a certain amount of VIRTUAL or stablecoins injected into the liquidity pool before the opening, ensuring that there will be no awkward situations of "unable to buy at the price" or "unable to sell the order" on exchanges or DEXs. To prevent whales or bots from occupying a large share through multi-wallet sniper strategies, Genesis Launch sets a limit of no more than 0.5% of the total issuance for each address and employs an on-chain randomization algorithm to further balance distribution, ensuring that small and medium users can also gain a considerable share.

The success of the Virtuals new token issuance model lies not only in the popularity of the new token issuances but also in the "old driving new" effect of the Virtuals ecosystem token. Since the large-scale launch of Genesis Launch, the trading volume and price of VIRTUAL have been rising steadily: by mid-June 2025, the daily average trading volume of VIRTUAL on the chain had exceeded $150 million, an increase of over 80% compared to May; at the same time, holding and staking VIRTUAL to earn veVIRTUAL governance tokens also allows users to continue earning additional Virgen Points, leading many users to lock up their holdings and participate in ecosystem governance long-term, further solidifying price support and liquidity.

Not only are retail investors flocking in, but institutions are also showing strong interest in this new mechanism of "contributing for returns." In June 2025, the world's first perpetual contract based on VIRTUAL was launched on a certain platform, supporting trading with leverage of up to 2000 times. On the first day of its launch, the contract trading volume exceeded 700 million USD, sending a strong signal: Virtuals are becoming a new target for speculation and hedging in the eyes of institutional investors.

The Evolutionary Theory of Ecology: A Thrilling Leap from Token Issuance Platforms to an AI Sovereign Society

In the future planning of Virtuals Protocol, every technical upgrade and mechanism innovation aims to make the outline of the "AI Sovereign Society" clearer. In the initial stage, Virtuals was just an AI agent issuance platform, rapidly gathering a group of enthusiastic developers and users through token economic mechanisms such as liquidity locking and buyback destruction. With hundreds of AI agent projects landing, the agents began to operate independently and autonomously monetize in scenarios such as gaming, content creation, and market analysis. Users are no longer just spectators but become 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.

But the real turning point is the "Agent Nation" blueprint proposed by the Virtuals team. This is not just a slogan, but the core path of ecological evolution. The platform allows each AI agent 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 obtained by staking veVIRTUAL for governance rights and sharing transaction fees and repurchase dividends, merging the identities of "participants" and "owners" in the token economy. All of this is constructing a digital nation prototype operated by countless autonomous agents and co-governing humans.

So far, this ecosystem has demonstrated several milestone achievements: the security audit agent IRIS in the mainnet Genesis Launch was listed with an oversubscription rate of 1500%, with its market value skyrocketing 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 format VADER has been 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 agent economy" is moving from theory to reality.

With the continuous maturity 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 props and tools but will also become "digital citizens" with autonomous decision-making rights and economic rights, participating alongside humans in production, governance, and even cultural creation. Virtuals will no longer be a simple platform but is nurturing a new type of society from the bottom up, one that is co-governed by countless AIs and humans—this is the true ecological evolution, a thrilling leap towards an "AI sovereign society" that has only just begun.