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DeFAI is the new Decentralized Finance: What is DeFAI Overview of related projects
Author: 0xJeff, Head of Steak Studio; Translator: Xiaozou from Golden Finance
DeFi has always been the backbone of Web3. It is DeFi that demonstrates the practicality of blockchain, providing us with the necessary tools for instant remittances on a global scale, on-chain asset investment, intermediary-free lending, and cross-DeFi protocol strategies. These all represent attainable financial freedom.
More importantly, DeFi solves real-world problems. It allows those without traditional bank accounts to access financial services, eliminates intermediaries, and operates around the clock, creating a truly global inclusive financial system.
But let's face an obvious problem together: DeFi** is really complex**.
Setting up a wallet, managing gas fees, and learning to avoid scams in an environment rife with fraud is not very friendly. The increasing number of L1, L2, and cross-chain ecosystems only makes things more complicated. For most people, the entry barrier is too high.
It is precisely this complexity that hinders the development of DeFi, but DeFAI is starting to change that.
What is DeFAI?
DeFAI (DeFi + AI) makes DeFi accessible. DeFAI leverages artificial intelligence to simplify complex interfaces, eliminating the barriers that make it difficult for ordinary people to participate. Imagine a world where managing your DeFi portfolio is as simple as chatting with ChatGPT.
The first wave of DeFAI projects has now emerged, mainly focusing on three areas:
1**, Abstraction Layers**
The purpose of the abstraction layer is to make DeFi more accessible by hiding the complexity of DeFi behind an intuitive interface. The abstraction layer allows users to interact with DeFi protocols using natural language commands instead of having to use complex dashboards.
Before the advent of artificial intelligence, abstract layers like intent-based architecture simplified trade execution. Platforms like CoWSwap and SYMMIO enable users to achieve the best pricing in decentralized liquidity pools, addressing the issue of liquidity fragmentation, but they do not solve the core problem: DeFi still remains daunting.
Now, artificial intelligence solutions are filling this gap:
I personally use Slate, which is still in its early stages and has not released a token yet, but I like its automation features. I mainly use it to set conditional trades, such as selling 25% of my position if the market cap of [xxx] reaches 5 million dollars, or buying 5,000 dollars worth of tokens if [xxx] reaches the price of [xxxx].
Wayfinder Foundation is another interesting application worth paying attention to. It is a behemoth being built by the PRIME / Parallel team.
2**, Autonomous Trading Agent**
Why spend hours digging for alpha, manually executing trades, and trying to optimize your portfolio, instead of letting agents handle it? Autonomous trading agents are taking the concept of trading robots to a new level, transforming them into dynamic partners that can adapt, learn, and make smarter decisions over time.
It should be noted that trading bots are not a new phenomenon. They have been executing predefined actions based on static programming for many years. But agents are fundamentally different:
This niche industry is rapidly developing. It initially started for entertainment purposes, but now it has shifted to practical, profit-driven tools that can help users trade more effectively. However, there is an important challenge here: how do you verify that an "agent" is not just a robot, but even a person operating everything behind the scenes?
This is where DeAI****infrastructure comes into play.
DeAI**'s Role in Verification Agents**
Critical infrastructures like Trusted Execution Environment (TEE) ensure that agents operate securely and are not tampered with.
For example:
Why is this important?
When autonomous agents begin to handle large amounts of TVL—imagine $100 million or more in TVL—users will have extremely high security requirements. They need to understand how the agents manage risk, verify the framework under which they operate, and ensure that their funds do not ultimately flow into just any meme coin.
This field is still in its early stages, but we see some promising projects exploring these verifiable tools. This should be kept in mind as DeFAI develops.
The top autonomous tradingagent projects that I am closely following
As follows:
(1) Almanak
Almanak provides users with institutional-level quantitative AI agents, addressing the complexities, fragmentation, and execution challenges of DeFi.
The platform forks the EVM chain, considering unique complexities such as MEV, gas costs, and transaction order, to execute Monte Carlo simulation in real-world environments. It employs TEE (Trusted Execution Environment) to ensure the privacy of strategy execution and the security of alpha insights, and supports non-custodial fund handling through the Almanak wallet, allowing for precise permission granting for agents.
The Almanak infrastructure supports the conception, creation, evaluation, optimization, deployment, and monitoring of financial strategies. The ultimate goal is to enable these agents to learn and adapt over time.
Almanak raised $1 million on LEGION, receiving a significant oversubscription. The next steps include a beta release and the deployment of agents/initial strategies for beta testers. It will be interesting to observe the performance of these quantitative agents.
**（2）**Cod3x / Big Tony
Cod3x, developed by the Byte Mason team (known for their work with Fantom/SonicLabs), is a DeFAI ecosystem designed to simplify the creation of trading agents. The platform offers a no-code development tool that allows users to create agents by specifying trading strategies, personalities, or even tweet styles.
Users can access any dataset and formulate financial strategies within minutes using the API and strategy library. Cod3x integrates with the Allora network, utilizing its advanced ML price prediction model to enhance trading strategies.
Big Tony is the flagship agent for trading based on the Allora model, entering and exiting according to its predictions. Cod3x is working to create a thriving ecosystem of autonomous trading agents.
It is worth noting Cod3x's liquidity approach. Unlike the common alt: alt LP structure promoted by Virtuals, Cod3x utilizes a stablecoin: alt LP structure driven by Cod3x's own CDP (Collateralized Debt Position) cdxUSD.
Compared to the volatility of the alt:alt trading pairs, this adds more stability and confidence for LPs (liquidity providers) when providing liquidity.
Cod3x also has its own DeFi primitives, such as liquidity AMOs and Mini Pools, which deepen liquidity and add more functionality to agents in its ecosystem/ DeFi building blocks.
Note:
Axal / Gekko AI - Axal's auto-tuning product, handled by agents for complex multi-step crypto strategies. Gekko integrates auto-tuning features. I look forward to seeing how the integration of Gekko with auto-tuning performs data-driven trading.
ASYM - ASYM agents are described by many as the "cheat code" for meme coin trading, capable of analyzing large datasets from blockchain and social media to predict meme coin trends. ASYM has consistently outperformed the market. ASYM has demonstrated a return rate of 3-4 times through backtesting. I am very much looking forward to seeing its performance in live trading.
Project Plutus——I really like the name PPCOIN.
3**,AI-driven****dApp**
AI-driven dApps are a promising emerging field in the DeFAI sector. They are fully mature decentralized applications that integrate AI or AI agents to enhance functionality, automation, and user experience. Although this field is still in its early stages, some ecosystems and projects have begun to stand out.
One of the most active ecosystems in this field is the Mode network, an L2 ecosystem designed to attract high-tech AI x DeFi developers. Several teams dedicated to cutting-edge AI use cases have already emerged on Mode:
The core of the ecosystem is the native token MODE. Token holders can stake their MODE tokens to obtain veMODE, which provides airdrops from AI agents, access to project whitelists, and additional ecosystem benefits. Mode positions itself as an innovation hub for AI x DeFi, with its influence expected to grow significantly by 2025.
In addition, Daniele published the DeFAI theory through HeyAnon, causing a sensation.
He announced that HeyAnon is working on the following:
The market responded enthusiastically, with the market value of ANON tokens soaring from $10 million to $130 million. Daniele seems to have brought back the excitement of TIME Wonderland, but this time with a stronger foundation and a clearer vision (hopefully).
In addition to these two ecosystems, many teams are building their own AI dApps. Once the main ecosystems around these dApps are formed, I will share more content in the future.
Conclusion
DeFAI is transforming DeFi to make it smarter, simpler, and more accessible.
With the abstraction layer simplifying user interactions, autonomous trading agents managing portfolios, and AI-driven dApp optimization use cases, we are witnessing the dawn of a new era.
Not a rehash of the DeFAI Summer of 2020, but the DeFAI Summer of 2025!