Leading AI Agent Tokens Fell by 90% Compared To The Highs of 2024
Let's analyze what is happening in the AI agent market and whether we should expect its recovery.
The Situation in the AI Token Market
According to CoinGecko, tokens associated with leading AI agents have shown record losses since the beginning of 2025.
Among the largest cryptocurrencies by capitalization in the segment, ai16z (AI16Z) fared the worst. Over the past 30 days, the coin's price has dropped by more than 83%.
The price of Virtuals Protocol (VIRTUAL) fell by 65% over the same period, and PAAL AI (PAAL) fell by 56.6%.
This dynamic came as a shock to many traders. At the end of 2024, AI agent tokens showed impressive results. Many experts said that this segment would continue to grow, but so far their forecasts have not been justified.
Reasons for the Fall
According to analysts, the fall in AI token prices is primarily due to a change in market liquidity, not fundamental factors.
Traders attribute the sharp decline in interest in this segment to the outflow of liquidity into other projects. It all started after Donald Trump launched the memecoin Official TRUMP (TRUMP).
The coin quickly attracted the attention of investors. As a result, in just one day, the asset's capitalization exceeded $80 billion.
TRUMP absorbed most of the liquidity in the market. This led to a drawdown in other assets, including AI agent tokens.
In addition, macroeconomic factors also affected the negative trend. Earlier this week, Trump announced the introduction of duties on imports of goods from Canada, Mexico, and China, which led to panic in the markets, including the cryptocurrency market.
Recovery Prospects
Many experts are confident in the long-term potential of the AI token segment. For example, a trader known in the crypto community under the nickname ElonMoney on X (formerly Twitter) emphasized that many platforms, including ElizaOS and AI Rig Complex, have ”very strong teams, many high-end partnerships, and integrations with large projects and blockchains.”
In his opinion, these factors may become the basis for the growth of coins of projects based on artificial intelligence in the long term.
”I understand that this is a difficult time, and many investors do not know what to do next. But, at least, I would not panic and sell the assets that are already there. Instead, I would follow the project updates and patiently wait for the market to recover,” ElonMoney noted.
In addition, earlier in January, Trump announced the creation of a special structure to support the development of AI technologies — Stargate. It is planned to allocate $500 billion for this. In the long term, such an initiative may also favorably affect the segment of tokens associated with artificial intelligence.
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Large Whale Dumps 8,500 Ether Amid Surging Institutional Demand
In a sharp turn of events, a crypto whale has sold 8,500 ETH, raising speculations about the asset’s direction. In recent weeks, sideways traders dominated crypto assets within the ETH price outlook, slipping below resistance levels. However, Ethereum bulls saw buying opportunities like most market dips, making new low entry points ahead of anticipated inflows. At the time of writing, ETH’s price crashed 3% to $2,742 in the last 24 hours, extending weekly exits above 15%.
A Reversal of Upward Sentiments?
In the last 24 hours, a whale moved $23.2 million worth of Ethereum at around $2,736 per coin. This was followed by other sales from retail holders, wiping off the momentum gained the previous day. Most traders suggest that the grip on the wider market’s correction on top altcoins might be short-term. However, its impact lowered institutional demand, wiped off gains, and slowed decentralized financial (DeFi) numbers.
Today, Ethereum’s trading volumes sit slightly above $30 billion after its market capitalization fell below $131 billion. The leading altcoin has struggled to replicate previous gains in recent times as sentiments move to other assets. Altcoin repositioning became glaring after spot Ethereum ETFs failed to attract inflows like Bitcoin products. Despite the milestone, ETH price struggled suggesting the asset was overbought.
This led to a change in sentiments from Ethereum to XRP and Solana, altcoins now described as institutional investor favorites. Last year, SOL outpaced ETH growth without spot ETFs leading to surging optimism of the former’s products awaiting approval. XRP spiked in the same period to the third largest crypto asset by market cap.
Trading above $3 at the start of the year, analysts tipped a spike to $6 during the altcoin season as funds move out of Bitcoin. However, the market’s correction led to a sharp 22% weekly decline.
ETH Can Defy The Odds- Analysts
Amid the crippling downturn, crypto whales took advantage to ramp up ETH holdings. On Feb 6, the asset broke $2,800 after BlackRock purchased 100,535 ETH worth approximately $284 million. This large investment, alongside others, boosts trader confidence, as seen in hourly trading data.
Furthermore, Donald Trump’s World Liberty Finance added to its ETH holdings following the last correction caused by U.S. trade disputes. Recent acquisitions and on-chain factors led analysts to raise projections for the assets. Renowned trader Ali Martinez wrote on X that Ethereum is gearing up for a breakout above $4,000.
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