Onchain Daydreams

Sponsor: Frax — Fraxtal Ecosystem: Where DeFi Meets AI.

📸 Market Snapshot: While general AI had a strong week—with $TAO and $KAITO posting double-digit gains—most of the action went to AI agents, with the total agents market cap rising ~13%, led by the Virtuals ecosystem.

While $VIRTUAL gains this week were low, it may still be worth paying attention to. ETH season is in full swing—historically good for Base and, by extension, Virtuals. There’s also Genesis, though interest may be cooling, with the $VIRTUAL committed there starting to trend down.

Why? Launches are getting more competitive. There’s still upside though—but you’ve got to play smart.

• A recent analysis by Schen.eth shows no clear link between agent popularity at launch and performance.
• The biggest winners so far have been agents like $BIOS, which started quietly with low demand and then massively outperformed.

For more tips, make sure to check out our Genesis guide. But, outside Virtuals, some other trends stood out in agents this week:

• $BNKR (+20%) > $CLANKER (-20%) after the Gabagool scandal, while $BNKR maintained high mindshare across Cookie and Kaito.
• Artist Agents Surged — $BOTTO (+20%) pumped, and $KEKE more than doubled. Both were linked to Christie’s recent, headline-grabbing AI art auction.
• Betting Bots Diverged — sports bettor $DRAIFTKING (+15%) extended its free trial, predictor $AION (+16%) continued gaining, while sports bettor $BILLYBETS (-23%) dropped post v2 release.

Happy hunting out there—a green week always feels good, but remember to keep your wits about you!

To me, one of the most interesting generative onchain agent frameworks is Daydreams.

I've been tracking Daydreams since the start of 2025 through its deepening integration into Eternum, a fully onchain strategy game I recently covered that will have Daydreams agents roaming its map by this point next week.

Simply put, this framework lets you create AI agents powered by large-language models (LLMs) that can sign crypto transactions, call APIs, and remember what they’ve done.

Its code is lightweight and open-source, and it offers crosschain support across networks like Ethereum, Base, Solana, Starknet, Hyperliquid, Abstract, and beyond.

All that said, you can do many things with this system, from launching an autonomous trading bot to making a Twitter agent. But its Context and Memory approaches are ideal for onchain gaming, as they let Daydreams agents plan for and achieve goals over the long-term.

Additionally, the Daydreams codebase supports integrating with popular onchain game engines like Dojo and MUD, so it's straightforward to pop these agents into many of crypto's most popular rising games.

In a gaming context, then, Daydreams offers two main pillars of utility right now: 1) players launching their own agents to play games for them, and 2) developers launching agents as non-player characters (NPCs) to expand experiences for human players.

When it comes to that latter path, there is big potential for emergent gameplay unlike what we've seen in gaming before.

"Traditional game AIs are usually built on decision trees: if outcome A happens, then do B," Loaf, the lead dev of Daydreams and Eternum, recently told me via Telegram. "That’s a simplified example, but even full-scale trees become extremely complex and still have clear limitations, they're intricate pieces of software to maintain."

"Using agents powered by LLMs to build NPCs offers a far more elegant and dynamic alternative," he added. "It’s a higher-level, natural-language approach. You start with a system prompt that explains the game and how to win or play, and you supply a list of actions the agent can take. These two elements are passed to the LLM, which then determines an action—the cycle repeats every turn."

"The beauty of this setup is that changing an agent’s behaviour is as simple as tweaking the system prompt, the agent immediately shifts course."

If you want a glimpse of these smart NPCs in action, the first major demonstration will be Eternum Season 1, which officially kicks off on May 14th. You can try befriending them or destroying them and taking their onchain assets, so expect lots of intrigue here.

But what about launching your own agents that aren't NPCs to play against, but rather that play for you?

If you're more interested in automation like this, check out the Daydreams launcher at play.dreams.fun. You'll need 2,000 $DREAMS tokens, which costs roughly $7 USD currently, to access the platform.

Once signed in, you can begin tinkering with setting up your own agent. The first game supported here is the onchain RPG Gigaverse on Abstract, with support for more games like Ponzi Land and Loot Survivor coming soon.

To dive in, I recommend checking out the Gigaverse agent launcher and personalization guides by Calc.eth, a contributor to Daydreams and Eternum.

Long story short, you connect your Solana wallet on play.dreams.fun, paste in your LLM API key, and choose a model. All of the big frontier models are supported.

Then connect your Abstract wallet, select "Gigaverse," and tell your bot to start a run—it’ll handle combat and acquiring loot automatically. At this point, you can open the "System" tab to rewrite and personalize your agent’s description and goals. A single new line is enough to steer its playstyle in a new direction.

And that's all it takes! Just some $DREAMS, one API key, and a handful of clicks to unleash an onchain teammate that never sleeps.

Looking forward, the Daydreams devs are working on polishing mobile support and adding support for more games. If the project's trajectory continues on its current course, soon agents will be playing and earning across all the big titles in crypto.

The achievements and learnings to come here can drive us toward smarter, more complex agents in general. In the meantime, if you're keen to dive in deeper, be sure to check out the Daydreams docs and GitHub.

Plus, other news this week...

🤖 AI Crypto

• Coinbase Dev — released x402, a new open protocol using HTTP 402 to enable onchain payments in one line of code, particularly useful for agents
• CreatorBid — launched $BID Emissions V0.2 to distribute 3.33M $BID every two weeks via a new system rewarding locked tokens and active agents
• Freysa — unveiled a local-first digital twin app that runs on-device, connects to apps like Google and Slack, and is built for future crypto integrations
• Lantern Capital — launched with EF co-exec Tomasz K. Stańczak as GP, investing at the intersection of Ethereum, AI, and crypto
• 🔥 Tether — unveiled Tether AI, an open-source decentralized platform to run AI anywhere and have agents pay with crypto on their own

📣 General News

• AI — facing rising hallucinations despite becoming smarter, researchers warn
• Apple — exploring AI‑powered search for Safari with OpenAI and others
• Google — unveiled Gemini 2.5 Pro with smarter coding tools
• 🔥 OpenAI — acquired AI coding platform Windsurf for $3B, while reversing previous plans to become a fully for-profit entity
• OpenAI — launched "OpenAI for Countries" to Boost global AI infrastructure and local solutions

💻 Vibe Coding

• Figma Sites (tool) — design + ship full websites inside Figma 
• Flaunch (guide) — build an app that can tokenize anything and auto‑stream revenue to you 
• 🔥  Trendcoins by @keccers (template) — Build‑on‑Base winner that auto‑mints trending Google searches on Zora, with a remixable Replit template

📚 Reads

• 0xJeff — AI Agents: Ecosystem Leaders
• OpenAI — Expanding on What We Missed with Sycophancy
• 🔥 Anna Kazlauskas — Data Ownership in the Age of AI

The Fraxtal ecosystem is expanding at lightning speed—this month’s biggest highlight is IQAI.com, the newest Agent Tokenization platform from IQ and Frax. IQ is building autonomous, intelligent, tokenized agents launching on Fraxtal in Q1. Empower onchain agents with built-in wallets, tokenized ownership, and decentralized governance—all within a fast-growing Fraxtal ecosystem.

On this week’s AI Rollup, David, Ejaaz, and Josh dissect OpenAI’s $3B Windsurf grab, Google’s Firebase Studio blitz, and Apple’s Anthropic alliance as the newest land grabs on the AI frontier.

They also discuss Visa and Mastercard arming autonomous agents with “Intelligent Commerce," plus they dig into Hugging Face's hardware plays, Waymo’s 250k robot fleet, and more.

Catch up on all the past week's big intrigues—watch the full episode! 👇