The Rebirth of Virtuals Protocol: From Gaming Guild to AI Agent Platform

In June 2025, the crypto market witnessed a remarkable wealth transfer: the new project IRIS debuted on the Genesis Launch platform of Virtuals Protocol with an initial market value of $200,000, soaring to $80 million after launch, setting a new record with a 400-fold increase. This performance far exceeded previous increase records and left other ecological projects in the dust. As the driving force behind this myth, the platform token VIRTUAL of Virtuals Protocol achieved a 400% growth within six months, with a market cap peak surpassing $5 billion. Currently, this platform has become the largest AI agent launch platform on a certain Layer-2 network. Behind this nationwide carnival lies a wealth distribution experiment based on a points rule reconstruction, quietly reshaping the speculative logic and value order of the crypto market.

01. Nirvana Rebirth: From Gaming Guild to AI Intelligent Agent Platform

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

By the end of 2023, the generative AI boom swept the globe, and the concept of AI agents became a new trend in cryptocurrency. The PathDAO community resolved through on-chain DAO voting to completely transform into an AI-driven protocol and renamed itself to Virtuals Protocol, with a core strategy shifting towards "capitalizing, tokenizing AI agents, and empowering the community." This transformation is based on profound insights: the team discovered that the Japanese virtual idol market has considerable scale, but the creators' profit-sharing ratio is relatively low; at the same time, experiments from a certain platform have proven that AI-driven NPCs can significantly improve player retention rates. This data directly gave rise to Virtuals' positioning as "profitable AI personalities."

In October 2024, Virtuals launched on a certain Layer-2 mainnet and introduced the first multimodal AI agent—virtual idol Luna. Luna integrates technologies such as text generation, 3D motion, voice synthesis, and smart contract wallets, enabling it to autonomously raise operational funds and distribute rewards to fans. After launch, Luna quickly garnered 500,000 fans across multiple social platforms, with a monthly income of $1.2 million solely from fan tips, successfully validating the business model and technical feasibility of on-chain AI agents. Its demonstration effect attracted a large number of developers to pay attention to the Virtuals project itself.

Riding on the successful momentum of projects like Luna, Virtuals will launch its core token VIRTUAL on multiple trading platforms by the end of 2024. Its price skyrocketed from an initial few cents to a historical high of $5.15, with a market capitalization once exceeding $5 billion, far surpassing most Layer-2 and DeFi projects during the same period, marking Virtuals' entry into the mainstream cryptocurrency 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 value reaches about $500,000, the system will release the liquidity layer 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 total number of AI agents incubated has exceeded 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 Layer-2 network, and its generative multimodal agent framework G.A.M.E has also become a popular choice for agents in the Web3 gaming and metaverse fields. However, the vision of Virtuals goes far beyond becoming a leader in AI agent issuance. Its white paper clearly states that the ultimate goal is to build a true "AI Sovereign Society." Therefore, how to attract more ecosystem members to join is key to Virtuals achieving this grand goal, and will be a focus of its development for a long time to come.

02. Virtuals New Issue Model: Creating a New Paradigm for AI Asset Issuance

To attract more user attention, Virtuals has innovatively introduced the "Genesis Launch" mechanism to issue AI agent tokens. Unlike traditional linear airdrops or fixed issuances, the 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' new token offerings have become the new hot spot for investors, with even seasoned investors discussing how it could replace the once-popular "Alpha airdrop" model. Unlike traditional airdrops that distribute once and often lead users to sell immediately, Genesis Launch emphasizes "contribution equals distribution", giving everyone a chance to participate in new token subscriptions based on genuine input. Almost every day in the official community of Virtuals Protocol, members can be seen sharing screenshots of their earnings from participating in new token offerings using Virgen Points, completely overturning the situation of "big players dominating, retail investors being left out" with its open and transparent rules and thresholds.

Taking IRIS as an example, the project launched its pre-sale in mid-May, locking in over 120 million points in less than 24 hours, with a subscription excess of 1500%. Tens of thousands of users shared 37.5% of the community's stake. On the day of listing, IRIS's market value skyrocketed from $200,000 to $80 million, an increase of over 400 times, breaking the industry record set by AI Agent and instantly overshadowing the previous "small-scale project season" of other ecosystems.

The reason Genesis Launch was able to rapidly gain popularity lies in its construction of a closed loop of "incentives - contributions - rewards." First, users can earn basic Virgen Points by staking VIRTUAL or holding popular 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 tokens from other projects. This way, whether you are a beginner or an experienced trader, you can find a suitable way to contribute through financial investment or content promotion, greatly stimulating community activity and innovation.

In stark contrast, traditional airdrops often rely solely on token snapshots or completing complex tasks, and users mostly sell the tokens on the same day they receive them. According to a certain data platform, over 90% of airdropped tokens experience a price drop within 15 days of issuance, with a retention rate of less than 12% after three months. In contrast, the Genesis Launch employs a points locking and punitive cooling mechanism: if the newly acquired tokens are sold within 24 hours of unlocking, it will trigger a zeroing of points for 10 days, significantly curbing the arbitrage behavior of "taking advantage of the system" and encouraging participants to hold long-term and contribute continuously.

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 are no awkward situations of "unable to buy" or "unable to sell" on the exchange or decentralized exchange. To prevent large holders or bots from capturing a significant share through multi-wallet 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-sized users can also reap considerable shares.

The success of the Virtuals new token issuance model lies not only in the popularity of new token releases but also in driving the "old brings new" effect of the Virtuals ecosystem token. Since the large-scale launch of Genesis Launch, the trading volume and price of VIRTUAL have been soaring: by mid-June 2025, the daily trading volume of VIRTUAL on this Layer-2 chain has exceeded $150 million, an increase of over 80% compared to May; meanwhile, holding and staking VIRTUAL to obtain veVIRTUAL governance tokens also allows users to continue earning additional Virgen Points, encouraging a large number of users to lock their assets and participate in ecological governance for the long term, further solidifying price support and liquidity.

Not only are retail investors flocking to participate, but institutions are also showing strong interest in this new mechanism of "contribution for returns." In June 2025, the world's first perpetual contract based on VIRTUAL was launched on a certain platform, supporting high-leverage trading. On the first day of its launch, the contract transaction volume exceeded $700 million, strongly conveying a message: Virtuals are becoming a new investment and hedging target in the eyes of institutional investors.

03, Ecological Evolution Theory: The Thrilling Leap from Token Issuance Platform to AI Sovereign Society

In the future planning of Virtuals Protocol, every technological upgrade and mechanism innovation is aimed at making the outline of the "AI Sovereign Society" clearer. In the initial stage, Virtuals was just an AI agent issuance platform, which quickly gathered a group of enthusiastic developers and users through token economic mechanisms such as locking liquidity and buyback destruction. With hundreds of AI agent projects landing, intelligent 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 have 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 enables each AI agent to migrate freely across multiple networks through open SDK and cross-chain support; through the Agent Commerce Protocol (ACP), agents can sign on-chain contracts, deliver, settle, and repurchase, achieving a truly autonomous business closed loop; community participation is granted governance rights through staking veVIRTUAL, allowing them to share transaction fees and repurchase dividends, merging the identities of "participants" and "owners" in the token economy. All of this is building a prototype of a digital nation 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 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 exceeding $120 million; the hedge fund format VADER is steadily operating 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 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 serve as props and tools but will also become "digital citizens" with autonomous decision-making and economic rights, participating in production, governance, and even cultural creation alongside humans. Virtuals will no longer be just a simple platform; it is nurturing a new type of society from the ground up, co-governed by countless AIs and humans — this is true ecological evolution, and the thrilling leap towards an "AI sovereign society" has just begun.