CZ Urges AI Agents to Prioritize Utility Over Token Creation Amid Market Decline

Not every AI agent needs its own cryptocurrency: CZ

Artificial intelligence agents need to prioritize their intrinsic utility, not the launch of their in-house native tokens to raise funds. AI agent-related tokens have significantly declined over the past month, as their cumulative market capitalization decreased by over 21% to the current $27 billion, according to CoinMarketCap data. While their continued decline may be part of the broader crypto market correction, another reason could be a lack of focus on intrinsic utility, according to Changpeng Zhao, the founder and former CEO of Binance, the world's largest cryptocurrency exchange. Zhao wrote in a March 17 X post: "While crypto is the currency for AI, not every agent needs its own token. Agents can take fees in an existing crypto for providing a service." "Launch a coin only if you have scale. Focus on utility, not tokens," he added. Zhao's comments come during a significant downtrend for AI cryptocurrencies, which lost over 61% of their peak $70.4 billion market capitalization in the three months since they started to decline on Dec. 7. Numerous venture capital firms, including Pantera Capital and Dragonfly, are excited about the future of AI agents but have yet to invest in them, according to a panel discussion at Consensus 2025 in Hong Kong. Related: 0G Foundation launches $88M fund for AI-powered DeFi agents AI agents are gaining increasing interest thanks to their promise of increasing online productivity, streamlining decision-making processes and creating new financial opportunities. AI agents are already executing autonomous transactions on the blockchain without direct human input. The concept gained attention following a Dec. 16 post by Luna, an AI agent on Virtuals Protocol, which sought image-generation services. Luna also received an X response from STIX Protocol, another autonomous AI agent, which generated the requested images. After the images were generated, Luna paid STIX Protocol's AI agent $1.77 worth of VIRTUAL tokens on Dec. 16, onchain data shows. Yet, some of the demand for AI agents has since faded, as Virtuals Protocol's revenue fell 97%, Cointelegraph reported on Feb. 28. Related: Libra, Melania creator's 'Wolf of Wall Street' memecoin crashes 99% Industry watchers foresee a year of significant upside for the emerging field of AI cryptocurrencies. AI agents launch platform ai16z and decentralized trading protocol Hyperliquid are "poised for growth in 2025," Alvin Kan, chief operating officer of Bitget Wallet, told Cointelegraph. "Emerging narratives like AI-driven investments, decentralized AI agents and tokenized assets hint at a tech-driven shift, though with added risk," he said.

Changpeng 'CZ' Zhao Says He Has An 'Unpopular Opinion' On Using Crypto For AI Fees: 'Not Every Agent Needs Its Own Token'

Changpeng Zhao, the founder of the world's biggest cryptocurrency exchange Binance BNB/USD, advised artificial intelligence agent services to focus on utility rather than launching their own coins on Monday. What Happened: Zhao, popularly known as CZ, posted his "unpopular opinion" on AI agents and their connection to the cryptocurrency world. "While crypto is the currency for AI, not every agent needs its own token," CZ stated. "Launch a coin only if you have scale. Focus on utility, not tokens." Binance's former CEO added that agents can utilize existing cryptocurrencies to get paid for the services they provide. CZ's remarks invited reactions, with influential cryptocurrency analyst Benjamin Cowen presenting the same argument, although this time about cryptocurrency exchanges collecting fees in existing tokens rather than launching their own tokens. The retort appeared to be directed at Binance's exchange token, BNB. See Also: Crypto Leaders Step Up Pressure On SEC As Trump's Policies Reshape Regulatory Landscape Why It Matters: Zhao's viewpoint comes at a time when the AI agent cryptocurrency market is experiencing significant contraction. According to Coingecko, the market cap of AI agent coins has plunged 67% year-to-date, while its share in the AI market has shrunk from 67% to 45.52% as of this writing. Key AI agent coins such as Artificial Super Intelligence (FET) and ai16z (AI16Z) have fallen 60% and 88%, respectively, since 2025 began. It's worth noting that the AI agent bot market is expanding, with these virtual agents becoming increasingly adept at problem-solving. Additionally, the Web3 AI sector is projected to grow by a staggering 89.7%, outpacing the overall AI market's 44% growth by 2030. Photo: Koshiro Kao via Shutterstock Read Next: Peter Schiff Slams Bitcoin ETFs, Calls Selling Gold For BTC 'Worst-Timed Trade In History' $BNBBNB--%OverviewMarket News and Data brought to you by Benzinga APIs