AI agent platform Virtuals Protocol has seen a shocking decline in daily revenue. Revenue fell from $1.58 million on January 2 to just $21,927 on January 21.
This sharp drop of nearly 99% has caught the attention of the cryptocurrency community, and there are many speculations about its underlying cause.
Is Meme Coin fever the cause of Virtuals’ revenue decline?
According to data from Dune Analytics, Virtuals Protocol’s daily trading revenue has been in decline since peaking on January 2.
A significant factor in the sharp drop in revenue appears to be the rise of meme coins, specifically the TRUMP and MELANIA Tokens. They have occupied the market spotlight over the past week.
As these tokens have gained more attention, they have drained liquidity from other sectors, including the AI agent market. This even led to a 10% decrease in the market capitalization of AI Tokens on January 20.
The rise of the TRUMP and MELANIA Tokens, largely driven by social media fever, has diverted investor attention. As new meme coins began to proliferate, capital was reallocated to pursue the interest surrounding these tokens.
Additionally, user They point out that with many projects launched in a short period of time, attention is spread too widely.
“Do you think there is value dilution because too many people/projects/ideas are implemented in a short period of time? The greatest value is attention, but if it is too widely dispersed… then nothing stands out enough to be meaningful,” they said. tweet.
This theory makes sense in the cryptocurrency market, where attention is often of greater value than the fundamentals of a project. Plus, meme coins tend to overshadow more stable projects as the market focuses on which tokens are becoming the most popular.
Virtuals Protocol, which has attracted significant interest, is now facing the challenge of recovering from a sharp decline in daily revenue. The protocol needs to regain its footing soon, be it attracting new users or drawing back those who have been caught up in the meme coin craze.
