The Breakdown - Crypto Can Build The Agent Economy | The Breakdown

Episode Date: February 19, 2026

Daniel Shapiro joins to break down why AI and crypto may be destined to converge — from agent payments and identity to privacy, data markets, and the next big investable primitive. Thanks for tuning in! As always, remember this podcast is for informational purposes only, and any views expressed by anyone on the show are solely their opinions, not financial advice. – Follow Blockworks Research: https://x.com/blockworksres Follow Daniel: https://x.com/_dshap Follow David: https://x.com/dcanellis — Get top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter: https://blockworks.co/newsletter/ —-- Timestamps: (00:00) Introduction (04:17) Can AI Be Crypto’s Lifeline? (02:43) AI-Native Payments (06:35) Agents as the New Target Customer (10:54) Agent Trading and Security Concerns (13:00) Consumer vs Enterprise (16:14) DAS Promo (17:03) Will Crypto and AI Merge? (21:40) Tokens in the AI x Crypto Stack - - Disclaimer: Nothing said on The Breakdown is a recommendation to buy or sell securities or tokens. This podcast is for informational purposes only, and any views expressed by anyone on the show are solely our opinions, not financial advice. Host and guests may hold positions in the companies, funds, or projects discussed.

If we are going to live in this future of billions of AI agents popping up and autonomously conducting economic activity between each other, they need a way to verify with the people that they're interacting with, the other agents that they're interacting with. And so AI kind of makes everything really free and cheap and allows things to scale, but trust becomes scarce in that future. What blockchain brings to AI, right, is trust. Welcome to the breakdown. I'm your host David Canellas. The following conversation flows on from a recent episode all about the intersection of AI and crypto and how new financial primitives might be the key to escaping the supposed permanent underclass. For the best viewer experience, it's worth going back and checking it out

if you missed it. And don't forget to hit like and subscribe so you don't miss anymore. And with that out of the way, let's start the show. Nothing said on the breakdown is a recommendation to buy or sell securities or tokens. This podcast is for informational purposes only and any views expressed by anyone on the show are opinions, not financial advice. Host and guests may hold positions in the company's funds or projects discussed. Thanks for joining us, Daniel. Welcome to the show. Thank you so much. Thanks for having me. Cool. So, I mean, you know, I'll address the elephant in the room. Like, the market is tanking. Bitcoin is down and the rest of the crypto market with it. So, like, how much of this is cope that maybe, you know, an AI primitive can can save crypto

from the blood in the streets? No, for sure. I mean, I think that, I actually think a lot of this this selling is driven by, right, OG bitcoinsers that could be transitioning their mining operations to AI. So I think that AI is the place to look here like you're identifying. And I think right now, there aren't a ton of very obvious connections between the two technologies, but I think we're starting to see, if you look deep enough in the right places, I think that you can see how over time they're going to evolve to be very synergistic technologies and really, lie on each other, right? Like, if we are going to live in this future of billions of AI agents popping up and autonomously conducting economic activity between each other, they need a way to

verify with the people that they're interacting with, the other agents that they're interacting with, a way to get data securely. And so AI kind of makes everything really free and cheap and allows things to scale, but trust becomes scarce in that future. And so, right, like if one actor, one person can spin up, right, like thousands of agents on their own, like a lot of the systems that we rely on kind of degrade. And so I think that what blockchain brings to AI, right, is trust. And so like one example of that is there's this new protocol, ERC-804 that popped up. That's something that we've written about in our research.

And that essentially allows agents to establish trust through reputation validation. So think of like agent passports, right? Like they can register their identity. They have a certain reputation score. There's a validation registry. So essentially, like, agents can, you know, they can use OAuth. They can, like, use your own personal accounts across all the different websites that you need them to. and they actually know that that's like an authorized person behind that agent, right?

It's not just some, you know, some guy that's spitting up 10,000 of these things to go cause trouble. So I think that identity, I think verification, that's something that blockchain solves. And I think that that's something that is worth looking into. The other thing is payments. I think that this is a very natural kind of connection. If you have all these, you know, billions of agents interacting with each other, they need rails. that's faster than traditional ones that are cheaper. Coinbase led led the creation of a protocol called X402,

which is kind of aims at establishing the foundation for stable coin payments just directly over the HTTP protocol. And this is built specifically for AI agents. And so obviously you can't directly invest in that protocol, but I think a lot of stable coin infrastructure, Neobank infrastructure, and then the second order effects of that would be lending protocols, right, where if defy yields, let's say offer an additional maybe half to 2% yield over, like keeping the money in your bank or a treasury note, I think that any rational AI agent

would prefer to hold that stable coin where they can capture yield on that. Now, that's dependent on some regulation, which hopefully we get soon that we'll make it so that stable coins can offer yield as opposed to just banks. And that's like a fight that's going on right now. But I think, yeah, you might not be able to invest directly at X402. But as I said, there's kind of secondary layers there, second order effects there and companies that will benefit. And then I think the last thing here that I think is the most exciting that could be also the kind of the longest time frame here. So not necessarily something that's that's very investable right now, but what blockchains really are good at is generating consensus, right? And I think the consensus

computing is very big right now for finance, but I think that in the future, it's going to be kind of a critical component for robotics and cyberphysical systems and any mechanical system that's interacting in the world, but it needs access to data to really operate and communicate with each other, right? And these systems, they'll need data to train on. All the foundation models need data to train on. I think it's estimated by the end of the decade, all of like public web data will be exhausted. In the deep web or data that sits inside of companies, it's estimated that they have over 100x the amount of data that sits in the public web. And so I think, that that's kind of the great next you'd say gold mine for these for AI for these foundation model

companies and i think that the only way that that data gets out there is privacy and i think that a lot of the best looking solutions there around like specifically like fully homomorphic encryption maybe zk potentially multi-party computation mpc there's actually a lot of crypto companies crypto protocols that are tackling this like in f8 For instance, the leader right now is Zama. And so I think that investing in these privacy protocols is going to be very important because I think that kind of the fuel for AI is data. And I think that that's going to be the only way that whether it's, you know, in the short term,

AI agents on the internet or on the future, actual like, you know, embodied AI, right, like robots running around. Like they're going to need privacy rails to communicate with each other safely and secure. conduct economic activity. And so I think that that's the biggest synergy, but also maybe the furthest away. So, you know, I'm definitely optimistic. But yeah, with this price action right now, you know, it's easy to feel down. So maybe I'll throw it back to you, David, on that. I actually am filled with quite some optimism here in all of that. And it's funny because when you think about what has happened with the narratives around crypto and blockchain over the past

year or two in that it was it was big to have like the infra like everyone was everyone was over investing in infrastructure companies in or infrastructure protocols and and projects uh to the point that everyone was wondering where the apps are then it's like we had a a renaissance in app building almost so we got like polymarket and and all that kind of stuff uh but now it feels like we are drifting back into building infrastructure, but for a very clear goal, because we have a target, I don't want to say app, but it's like a target market almost in AI development. And now the penny has dropped. It actually, we can build infrastructure for a very particular reason that doesn't have to do with, you know, financial asset transfer or something like that or trade settlement. It can

actually be infrastructure for this different new technology. So that makes me optimistic. And that feels like something that could happen over the, if this is a bear market, it's looking like a bear market, over the bear market. So that's something to build during the bear market. Like, is that kind of how you're looking at it? Like, I'm just hoping that, you know, who knows what's going to happen to the AI narrative as well? So it's like you're trying to build something for a narrative that might also be fleeting. but it is at least some momentum. Like, is that how you're looking at it?

I think that's a great point. And you said something there of, right, these builders now, they have a target audience to build towards, right? And it's building for agents directly. Instead of, you know, the upteenth builder saying, I'm going to build infrastructure because that's going to get the most VCs to give me money. And I can launch something of the highest valuation, right? like as kind of the low float high FDV meta dies.

And we kind of return towards like a more ground up kind of approach here, something like what a hyperliquid did, which wants to, you know, kind of bring their community investors along the way. I think that when you combine potentially, right, a more bottom up level capital formation with a more clear and targeted use case here, which is building four agents. Yeah, I think that that's kind of the recipe to spawn some, you know,

really great investment opportunities over the next couple years, right? And you always get the biggest winners in the bear market. So instead of buying, you know, overvalued infrastructure at greater than a $1 billion market cap with significant token supply overhangs, maybe you're buying a, a cool, you know, agent kind of centric protocol at 50 million market cap with, you know, minimal token supply overhang, right? And it's just your odds of winning there are significant higher. And I think something that's interesting that happened this last week, and you talked about this is MOLPA, right? And these agents kind of autonomously interacting with each other. Like, it's just so intuitive to me that these things are going to be using crypto for payments,

for communication, for exchanging value, right? Like, if you can build a network or some type of app that that is optimized for them to kind of experiment on their own. And I don't know what that is. But to me, like, I think that there's, I think that there really is something there. And we're already, you know, people are already, you know, talking about all the privacy and security concerns with, right, giving your agent just access to your computer as well. So I think that like the security, the privacy elements that blockchain brings, I think that that's going to be needed for this type of like autonomous, you know, agent marketplaces, systems.

And so, yeah, I think that of all the places to look in, you know, if we are entering into a bare market, like I do think that the crypto AI intersection would be a fantastic place to start. Yeah. Did you pay attention to Alpha Arena? All that playing out? Yes. You know, it's like, this is like, it's the most, that's like the total left curve application of, of AI and crypto. And it's like, I really wanted that to do, to do better. But it's like, there is like, I run into like, I mean, it's the same kind of thing

that everybody runs into. It's like, yeah, I mean, if everyone knows what the agent is doing on chain, then whatever alpha it has or whatever edge it has on the market, it's really a non-starter to begin with. like so it's like it's it's funny that that has that is like not part of the conversation is like AI led hedge funds or or or what have you or like a tokenized money market fund that is like that that is all entirely run by an AI or something like that which it's like I wonder if that is like a pendulum theme too um and it's just like because to me like a lot of what you're describing like I don't know how like consumer level it is like it is it is like very

part of like the corporate structure that you know that corporations would want to make money on on their on their proprietary data so but it's like from the consumer side of it like is it really you know that the the the biggest thing is that it would be using like AI agents to act as a chain intermediary to kind of like handle like the actual interaction with the chain like so what I'm trying to get to is it's like if if there is like an AI primitive out there that will, you know, unlock some kind of economic activity. Like, how much of that is geared towards your regular crypto user rather than institutions? Because I still don't know, like, which is the bigger market in terms of the hype, if that

makes sense. Like, how do you square how valuable it is to target the consumer versus, you know, the private sector or even the government sector when it comes to this sort of stuff. Yeah, for sure. I think that at first they're going to be targeting enterprises, right, and private sector governments. But I think, like, I think, I think D-PIN is actually kind of the best analogy to think about here. When you want to see, like, how can consumers add value or how can they get targeted and deepens all about, right, like taking laden resources that the everyday person has and allowing them to contribute that to a network, right? As I said, I think that as

these models get better, I guess the signal for this is the price of RAM, which has more than like tripled in the last, you know, whatever, six months, Open AI has bought like, or I think, and VDIA's bought like the next, you know, two years of supply of RAM from, you know, whoever Intel or whoever makes it. I think that, right, these models running locally on device is going to get really big. And so, you know, maybe it gets to the point where, like, a consumer could literally just, you know, connect their phone to some application and they can just start passively making money by, like, renting out spare memory, like something like a render or in a caution.

And that didn't really work with GPUs. I think that, right, like, and it's kind of the state of the market right now. Like these consumer GPUs don't have enough V-RAM to contribute to training frontier models. Also, to train frontier models, they all need to be in a very, the GPUs need to be in very close proximity so that they can share data over high-speed fiber optic cables very quickly. There are a couple protocols. One is called Nuse Research. Also, prime intellect.

They're making ways for GPUs to, I guess, talk to each other over longer distances, over the internet and still be able to train frontier models. But I think that as kind of the size of these models, or I guess the ability to run them locally, as that becomes more feasible, I think that the whole consumer hardware play actually becomes viable. And so I think that there's some retail interaction there. And then also like advertising. I know like Anthropic is putting out these ads right now, taking firing shots at OpenAI. But like advertising is is a massive, massive industry. And if, you know, if someone can find a way to, you know,

essentially make it so that consumers can maybe, you know, give data or their recommendations or they can submit, you know, selectively submit information about, them, like their demographics for targeting things. Like, I think that advertising at some level, it's going to get pushed into AI. And I think that that's going to open the door for open source model providers to step in and actually provide a real product. And I think that consumers, like the everyday, I think they're going to benefit greatly

from something like that. So, I don't know, I think it's super hard to predict. But I think that consumer use cases will be there just like, enterprise ones. Quick break before we continue, Blockworks's flagship institutional conference, Digital Assets Summit, is back in New York City this March 24 through 26th. Das brings together allocators, asset managers, policymakers, and the builders actually shaping crypto's next phase.

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in 2026, this is where that conversation happens. Use code breakdown $200 for $200 off. Learn more at blockpost.co slash events. Now, back to the show. It's funny. It's like it's like a converging of innovation speeds in a way. And crypto has been pushed ahead a lot, I think, in the past two, two. three years, especially like compared to what was happening in 2018 and 2019. And then it's just, we had to take a breather almost. And then AI came along. So now it's kind of just ensuring that both these kind of ecosystems are, I don't want to say like aligned, but at least like

both have a certain amount of velocity behind them and interest. And it's, and I'm hoping that that the interest levels can align over the next year or two between AI and crypto, because they've kind of like, they've kind of like ones come first and the next one, and then the next one's gone. But maybe they can just both kind of happen at once. And to me, to me that's like the most bullish prediction that I can think of, is that something like that would happen. And then, and that in that case, maybe you wouldn't have AI-only venture funds and crypto-only venture funds. there would be crypto and AI plays in one vehicle.

And that would, I think, would mark kind of the very start of the next froth, I would say. You know, how would you feel about that? Is there, is there, I wouldn't say that there's appetite right now, like going from the timeline what people are saying about the venture capital market in crypto, like it seems very difficult to raise right now. But I guess, you know, and it's hard because a lot of these venture funds, would already have separate vehicles of both of them. Is there a way to kind of square this that that would make a lot of sense that really just

crypto and AI just become one space? Because that seems like the end game. I think it's possible. I mean, I'm not, I'm not like super familiar with venture, but I do know that like large funds, they do, large venture funds, they will segment their individual funds by category. But I mean, I think just yesterday, A16Z, who I think is the largest venture fund, they released an article saying that that AI is going to be dependent on crypto, right? So I think that the smartest people in the room are thinking about this and how the two technologies are going to kind of collide and be synergistic on each other. I think like anything, I think it's just going to take one killer use case, right?

like someone's going to build something that kind of ignites that um ignites you know people's um you know not not animal spirits necessarily but one thing that signals people oh like this is real right and like the example you gave in defy was right like amm's and um or you know when when compounds started yield farm right and you know i'll never forget defy summer right like i think that that really captured people's imagination. And that was like to me like the that created the momentum that's kind of carried us through this moment. Right. And I think that like those like the defy primitives are very well established and kind of not maybe not the long long term winners, but like at the present like a lot of the winners have kind of been established there. Yeah, I think that there's going to be

someone someone's going to build something that sits at the intersection of these these two technologies. and I think that that's what will spark, you know, people's imagination again. I don't know if they're ever going to combine into the same thing. Like, I think crypto is inherently kind of more backend infrastructure, right? Like, the ideal end state of crypto is that it exists in under everything and no one knows that they're even using it, right? Whereas AI, it's a lot more of a consumer, it's a lot more of a consumer phasing technology, right? Like you open up the app and you physically start talking to it.

Like you can see what it's doing, right? Where the ideal end state of crypto is, you know, it doubles, crypto doubles the GDP of the globe because it replaces third party intermediaries and decreases the friction for economic activity. You know, that's kind of like a boring thing, right? It's just kind of improving the efficiency, getting rid of these kind of, you know, leeches sucking value from here and there. but I think that they will rely on each other.

I don't know if they'll, like, kind of combine into the same thing, though, per se. But, yeah, I think that synergies will exist. This conversation is really kind of let the kind of light bulb off in my head, that it's really like crypto is the thing that will ultimately, like, if that killer app is made, it would be really good if the value could, accrue to the users and even in such a way that they wouldn't have to buy anything to invest in it that they would just be rewarded for their participation in that app. So it's like that that also gives me hope in that you can kind of bypass this concert of like,

well, you know, can we even buy the open AI IPO anymore? Is that even going to do anything for me? But actually, that if, you know, if there is some kind of push to, from like the AI ecosystem to really integrate with crypto in a very significant way, then that could kind of remove a lot of this concern about, you know, tokenized equity and just like ownership rights of tokens that actually maybe it's just like a tokenless system, apart from like maybe stablecoin payments or something like that. So it's, that kind of is like, you know, it's hard because you're removing some element of financialization from the process. At the same time, you are kind of

creating a more steady environment for further adoption. I know it's a fragmented thought, but how far do you see tokens and like investable tokens being a part of like the AI crossed with crypto space? Because like a lot of it is like infrastructure. A lot of it is like 804 tokens and stable coin payments and stuff like that. Like how would tokens really fit into it? because it isn't so obvious on my side. Yeah, and I think that, I think this is the ultimate question, right? And it's like, what is the application going to look like? I don't know if it's going to be tokens or tokenized equity.

Like at least I personally believe that everything is going to get tokenized. And really what that just means is that the financial system is going to upgrade from this current, like, slow, this kind of slow, very disconnected. system that's built on, you know, 1970s level infrastructure to like a more modern, interoperable, more efficient system, right? And not only happens if all these things, if, you know, anything you can buy becomes a token, right?

A token, it's just, it's just an ownership, right? But the interoperability of tokens, the ease to transfer them, the ability to do kind of, right, like algorithmic, instantaneous rebouncing of them. I think that they're going to replace everything now, whether we have tokens in their current state with like dows and stuff, or if we just have companies that just tokenize their own equity, and right,

that's a very well-understood structure. I think that we can debate that, but I do think that everything is going to get tokenized. So I think what you're probably looking at are companies that solve problems in this supply chain. Right. So like whether, you know, whether that's distributed GPU training, something, someone like news or prime intellect, something like distributed file storage, right, like a file coin. Like I think that there's going to be primitives that they're required for this agent

economy. And those companies will be investable, right? Like once again, whether they're decentralized protocols or they're, they're companies that have, you know, you can just go buy the tokenized equity. And maybe they launch, you know, they, they, they, they, they, ICO because it's it's you know three kids in a basement and they can't get venture funding and so maybe right they take advantage of the ability you know to um to raise capital from the public market with something like crypto right that that makes something like this so I think like um once again right crypto it's more of this kind of foundational layer that's sitting in the background it I do think that it's going to play a part um you know I I don't have the answer of like

what that company is going to be but But, right, like, I do think that it'll, you know, you'll see it, like, you'll see it, and you'll recognize it when it happens. Like, I think the whole Claudebot thing, it's not super useful right now, right? Like, it can be useful if you're willing to spend $400 to $1,000 a month. But maybe in a year, right, like, you're going to have a personal assistant. That's going to be very useful. But, like, that's a technology you see, like, oh, like, I'd be, you know, I'd be willing

to go buy like some pre-packaged little system that costs less than like a MacBook Mini to like run this thing on in like a sandbox environment, right? And maybe that thing would integrate crypto in some way, right, for like payments or or the ability to yield farm, right? So like I think that it's it's coming and those protocols will be investable. But yeah, I just don't think it's been built yet. We're so early. But cool. That's about all the time we have for today. Thanks so much for joining me, Daniel. And yeah, good luck. If this is the bear market, good luck for the next year or so. Sounds good. Thanks for having me, David.