The AI agent market cap has taken a significant hit, dropping to $6.6 billion as the top tokens in the market experience double-digit losses. This decline comes after a period of substantial gains for AI agent tokens in late 2024, making them one of the hardest-hit sectors in the current crypto market downturn.
According to data from CoinGecko, the collective market cap of AI agent tokens has decreased by 40%, falling from over $10 billion to around $6 billion. The top 10 AI agents by mindshare have seen mostly downward trends in their market caps over the past week, with some experiencing sharp declines.
Fartcoin (FARTCOIN) suffered a 53% loss in market cap, while Ai16z (AI16Z) followed closely with a 51% decrease. Virtuals Protocol (VIRTUAL) and aixbt (AIXBT) also saw significant drops of 49% and 45% respectively. Griffain (GRIFFAIN) and ARC fell by 32% and 43% respectively. However, HENLO, VVV, and SNAI were the only AI agents to see their market caps increase over the week.
Crypto researcher Crypto Stream shared his insights on the decline in the AI narrative, attributing it to liquidity leaving the market rather than the projects failing. He noted that liquidity seems to be moving towards large-cap altcoins, while on-chain AI projects are struggling the most. Despite this, he believes that liquidity may return to AI coins in the future, but certain conditions would need to be met.
Crypto Stream cautioned investors against trying to time the bottom of AI projects, as it carries high risk and uncertainty. While it could be profitable, there is a high probability of missing the bottom and no guarantee that projects will reach their previous highs.
Overall, the AI agent market is facing challenges as it navigates through the current market downturn. Investors are advised to proceed with caution and carefully consider their investment strategies in light of these developments.