Checking out the DeFAI Micro-sector with Cookie(dot)fun

In the ever-evolving landscape of Web3, a new concept is taking shape: DeFAI. A fusion of decentralized finance (DeFi) and artificial intelligence (AI), this emerging sector is capturing the attention of crypto enthusiasts and investors alike.

What is DeFAI?

DeFAI is essentially the integration of AI-driven automation into decentralized finance protocols. These protocols, which include lending, borrowing, staking, and on-chain swaps, are being enhanced by AI agents to optimize trading strategies, arbitrage opportunities, and portfolio management. The goal is to bring efficiency, intelligence, and automation to financial activities on-chain.

One tool that Swept has begun using to track the DeFAI micro-sector is Cookie.fun, a platform that helps users track DeFAI tokens and projects.

The Current Landscape: Solana and Base Leading the Charge

At present, DeFAI is a niche sector within the broader crypto industry with a combined market cap of approximately $813 million. Solana and Base networks are leading the way.

• Solana: Home to a DeFAI market cap of $435M, Solana has emerged as a key player in this sector.
• Base: With $262M in market cap, Base has carved out a significant portion of the market, with more than double the DeFAI market cap on all other networks combined, except Solana.

Key Players in DeFAI

Several notable projects are pioneering this space, each contributing to the evolution of AI-powered DeFi:

1. AIXBT

AIXBT is an AI-driven analytics platform that scrapes data from social media and on-chain sources to provide real-time insights. By identifying significant movements in the crypto market, it posts automated updates on social media, offering a non-biased perspective on market trends.

2. Virtuals

Virtuals Protocol serves as an AI agent launchpad on Base, positioning itself as a competitor to AI frameworks like Sakuro Agentic and Eliza OS. With a $VIRTUAL market cap of $870 million, Virtuals enables AI agent deployment in the blockchain space.

3. AI 16z (Now Eliza OS)

Previously known as AI16z, ElizaOS is developing a blockchain-focused AI infrastructure designed to enhance agent-based automation. While its market cap has dropped from $2.5 billion to around $500 million, it remains a significant project in the DeFAI landscape. Both Eliza and Virtuals are in competition with Saakuru Agentic Framework for mindshare and market share.

4. Venice AI

Venice AI $VVV gained traction by riding the wave of attention generated by DeepSeek following its security breach and $VVV token launch. Its strategic marketing efforts have helped maintain its visibility and market share, with a current valuation of $175M.

The Future of DeFAI

While still in its infancy, DeFAI is showing signs of rapid growth and adoption. As AI continues to revolutionize industries, its role in DeFi will likely expand, leading to more sophisticated and autonomous financial applications.