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The idea of AI Agent, which refers to an intelligent software system that can understand its environment and autonomously perform actions on behalf of the user or machine to achieve its goals, was conceived in the 1980s. However, this concept only started gaining traction from the 2010s when the rise of deep learning and large language models (LLMs) demonstrated their abilities to understand and generate human-like responses.

Since the first half of 2024, the crypto market has experienced remarkable growth, with its total market capitalization surging by 44.2%, from $2.31 trillion to $3.33 trillion. This growth has been underpinned by key milestones, including the approval of spot BTC and ETH ETFs in 1H 2024 as well as the landslide election victory of Donald Trump in 2H 2024, whose deregulatory agenda and pro-crypto policies have fueled optimism in the industry.

In mid-2024, HashKey Capital released AI into Crypto, highlighting the growing prominence of AI Agents. By the second half of 2024, this trend had surged, prompting the HashKey Capital research team to create a comprehensive brain map of AI Agents to better understand the current landscape.

The memecoin sector has taken the industry by storm in 2024, outperforming every asset class by recording a price performance of more than 218% according to data from Artemis. Behind this jawdropping performance are various notable memecoins that have attained unicorn status and widespread community such as DOGE, POPCAT, VIRTUAL, PNUT, FARTCOIN, among others. The symbolism of memecoins, culture, community and its truly decentralized nature have led many retail users to easily participate in them.

Looking back, many cutting-edge discussions within the Ethereum developer community have shaped the daily applications we now take for granted, such as DEXs, lending platforms, rollups, and decentralized applications. These discussions often signal future investment opportunities.

Market sentiment was generally bearish for altcoins in Q3, with Bitcoin dominance rising to around 54%, its highest level since April 2021. The Altcoin Season Index currently reads 37, after hitting its lowest point in mid-August.

As one of the most active crypto VCs, HashKey Capital regularly analyzes every Web3 sector internally. In the 1H 2024, we “open source” our internal sector analysis and insights as our contribution to the industry.

Market Decline: August began with a notable market downturn, driven by the Bank of Japan’s interest rate hike, prompting Bitcoin to drop 25% initially.

Crypto Market cap reached a 3-month low of $1.9 trillion on July 5th and recovered to $2.2 trillion by month-end. Bitcoin and Ethereum showed an inverse correlation with US stocks TVL growth outpaced total market cap growth by 8.9%, indicating strong net new inflows.