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AI Agent

Software that uses artificial intelligence to perceive information, make decisions, and perform actions toward defined objectives.

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Definition

Software that uses artificial intelligence to perceive information, make decisions, and perform actions toward defined objectives.

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Why it matters

AI and blockchain concepts explore verifiable computation, autonomous agents, provenance, and decentralized AI infrastructure.

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How it works

An AI agent functions by integrating an LLM or specialized model with a blockchain adapter. The agent monitors blockchain events, processes the information, and triggers smart contract functions if specific criteria are met. It uses a private key to authenticate its transactions, ensuring the actions are recorded immutably on-chain.

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Real-world example

Fetch.ai agents working in supply chains to negotiate logistics costs and settle payments autonomously.

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Advantages

  • Operates 24/7 without human fatigue
  • Direct integration with DeFi protocols
  • Automated decision-making capability

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Limitations

  • Potential for unpredictable automated actions
  • High reliance on model accuracy
  • Security risks regarding wallet private keys

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Common misconceptions

  • People often think AI agents are just chatbots when they are actually active participants in the economy.
  • Many assume these agents are centralized systems controlled by one entity.
Canonical knowledge ID: glossary:ai-agent