> ## Documentation Index
> Fetch the complete documentation index at: https://docs.theblockchainlibrary.com/llms.txt
> Use this file to discover all available pages before exploring further.

# AI Agent

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

# AI Agent

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

## Definition

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

## Why it matters

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

## 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.

## Real-world example

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

## Advantages

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

## Limitations

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

## 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.

## Related knowledge

* [Blockchain](/categories/blockchain) — term
* [Decentralized Compute](/generated/v2/glossary/decentralized-compute) — term
* [Verifiable AI](/generated/v2/glossary/verifiable-ai) — term

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**Canonical knowledge ID:** `glossary:ai-agent`