DeFAI, AI Agents, and DeSci Have Been Obliterated in 2025

Decentralized Finance AI (DeFAI), AI Agents, and Decentralized Science (DeSci) were hailed as the future of crypto last year. Now, they are the three worst-performing crypto sectors of 2025.

Dexu data indicates that DeFAI, a crypto category that combines Decentralized Finance (DeFi) with AI to provide unique crypto experiences in trading, risk management, and yield optimization, is the worst performer on the list, down by 91% year-to-date (YTD).

DeFAI exploded toward the tail end of 2024 following the emergence of AI agents, but has since bled due to the dwindling demand for AI Agent tokens and the general downturn in the crypto market.

Unsurprisingly, AI Agents are the second-worst performers on the list, down by 81% in the past three months. Coingecko data indicates that the entire sector plunged by 12.5% in the past day, with category leaders like ai16z and Freysa AI experiencing significant price dips of 19% and 12%, respectively.

Decentralized Science (DeSci), a branch that combines scientific research with blockchain-adjacent technologies like crypto tokens, non-fungible tokens (NFTs), and decentralized autonomous organizations (DAOs), is the third-worst performer, down 75%.

Notably, venture capital firm Dragonfly’s managing director, Haseeb Qureshi, predicted the AI Agent collapse in a Jan. 1 X post outlining his predictions for the new year.

“The ‘AI agent' craze will continue probably throughout 2025. But it will die off eventually. This is not the long-term disruption to watch out for from AI, but it will be CT's fixation because it is the most social. These things are not really agents. These are chatbots with memecoins attached; they are barely agentic at all besides posting on Twitter,” Qureshi said.