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Traders say the tokens drawdown was more about shifts in market liquidity than fundamentals.
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Tokens tied to artificial intelligence agents are down by as much as 90% from 2024 highs, according to data from CoinGecko.
Top agentic AI platforms — including AI Rig Complex (ARC), ElizaOS (AI16Z) and Virtuals (VIRTUAL) — shed between roughly 75% and 90% of market capitalization since January, according to data from CoinGecko.
Agentic AI tokens, which clocked massive gains in the fourth quarter of 2024, are among the biggest losers of the cryptocurrency market’s drawdown, which started in January.
The total crypto market cap is down by nearly 16% since January highs, according to CoinGecko.
“Looking at the charts of ai16z, $arc, and even Fartcoin, it’s clear that the trend has been downward, and many believe these tokens may never recover to previous levels,” Elon Money, a crypto trader and researcher, said in a Feb. 6 post on the X platform.
Fartcoin, an AI-related memecoin and one of the most widely-watched tokens of 2024, dropped by around 65% in the past 30 days to a market cap of around $430 million as of Feb. 6, according to CoinGecko.
Overall, AI agent tokens are cumulatively down by upward of 40% to roughly $6 billion from highs of more than $10 billion, according to CoinGecko.
Source: Elon Money
Related: AI memecoins will become utility tokens
Shifting liquidity
On Jan. 18, Trump launched his eponymous Official TRUMP (TRUMP) memecoin, which surged to roughly $80 billion in market cap within one day of launch.
Crypto traders say TRUMP sucked liquidity and attention away from other new tokens, including memecoins and AI agent tokens.
“The reason for the sharp sell-off [of AI tokens] is clearly narrative-wide, meaning liquidity is leaving,” Crypto Stream, a crypto researcher, said in a Jan. 31 X post.
Meanwhile, US President Donald Trump, who started his term in January, set off marketwide panic when he threatened to levy 25% tariffs on Canada and Mexico, the US’s largest trading partners.
In crypto markets, tokens tied to small, emerging projects took an especially hard hit.
“Large altcoins have been performing well while onchain altcoins are getting slaughtered,” Crypto Stream said.
AI agent tokens by market cap. Source: CoinGecko
Long term potential
Still, traders are optimistic about AI tokens’ longer-term potential.
“When it comes to frameworks like ElizaOS and Rig, they have incredibly strong teams, multiple high-profile partnerships, and integrations with major projects and blockchains,” Elon Money said.
Agentic AIs — machines pursuing complex goals autonomously — are reshaping the digital economy, contributing to Web3 applications, launching tokens and interacting with humans autonomously.
Asset manager VanEck expects upward of 1 million AI agents to populate blockchain networks by the end of 2025.
Magazine: Crypto has 4 years to grow so big ‘no one can shut it down’: Kain Warwick, Infinex
This article first appeared at Cointelegraph.com News
