When Decentralized Finance meets AI: Decrypting the DeFAI wave of the Arbitrum ecosystem

This innovative track will not only reshape the way users interact with Decentralized Finance, but also has the potential to become a key driver for the widespread adoption of Web3. This article is from the article written by @arbitrum_cn, organized, compiled, and written by DeepTech TechFlow. With the rapid development of AI, its combination with Decentralized Finance is quietly giving birth to a new track: DeFAI. This innovative track will not only reshape the way users interact with Decentralized Finance, but also has the potential to become a key driver for the widespread adoption of Web3. This article will take you deep into the current development of DeFAI and several representative innovative projects in the Arbitrum ecosystem. DeFAI is the product of the integration of AI technology and Decentralized Finance protocol. It focuses on integrating AI capabilities into Decentralized Finance applications, which can be applied to various aspects such as financial management, decision-making, and user interaction. Today, Decentralized Finance provides users with a Decentralization financial platform that allows them to manage assets without the need for third-party involvement. However, the complexity of Decentralized Finance platforms has become a significant obstacle to widespread adoption. Many users find it difficult to understand the unique concepts of blockchain, such as smart contract interaction, and do not know how to exchange basic Tokens between multiple chains and platforms. Users are susceptible to fraud and often cannot accurately grasp how to ensure the security of their funds, which has led to a relatively stagnant adoption rate in the Decentralized Finance field. This is also why centralized exchanges have become the first choice for many users to participate in Cryptocurrency trading, which to some extent goes against the original intention of blockchain. By introducing AI into Decentralized Finance, the interaction between users and Decentralized Finance can be simplified. Through AI systems, users can obtain a smoother Decentralized Finance protocol interaction experience. In addition, AI can help identify potential fraud and suspicious transactions, making Decentralized Finance a safer space for users. According to raz.dmt, in the near future, the combination of AI and Decentralized Finance will make purchasing Cryptocurrency as convenient as ordering takeout at home. Users not only do not need to switch between multiple platforms, but AI can also enable users to purchase Tokens directly on the web, helping users automatically identify the correct chain and Token contract and ensure that transactions are executed safely. With so much said, let's also discuss some DeFAI projects in the Arbitrum ecosystem: AiSweat.Shop AiSweat.Shop is a platform that focuses on integrating AI agents with Decentralized Finance functions. Unlike simply providing basic Web3 Wallets for AI agents, AI Sweatshop takes a different approach by using AI to enhance existing Decentralized Finance products. This approach allows users to perform advanced operations such as Liquidity Mining, Liquidity management, and even automated trading using AI. For AiSweat.Shop, the decision to build on Arbitrum was a carefully considered one. Although the team was initially attracted by the AI Liquidity active on Solana or Base, they ultimately chose Arbitrum, seeing its thriving Decentralized Finance ecosystem and strong early adopter community. Kate W, a core contributor to AiSweat.Shop, said: Choosing to deploy on Arbitrum is because it is an innovation hub for Decentralized Finance. The community here is active, and foundational projects like GMX continue to thrive. Bringing our AI-driven Decentralized Finance solution to such a vibrant ecosystem is a very obvious choice. AI Sweatshop is collaborating with leading Decentralized Finance projects on Arbitrum, including Camelot and GMX, to explore how AI can drive innovation in Liquidity management, yield optimization, and other areas. Their goal is to provide user-friendly tools and interfaces that allow individuals to achieve maximum returns with minimal effort, demonstrating the transformative potential of AI in Decentralized Finance. Kudai GBC was established in 2021, initially launched as a Non-fungible Token series, and has attracted the GMX community. The company was founded by three like-minded old friends, each with complementary expertise: XM as CEO, feed them in charge of product and strategy, and Vee as Chief Growth Officer. The team has previously participated in several well-known projects in the Web3 space, including Pudgy Penguins, Vertex Protocol, GMX, and Juice Finance. Kudai and Kaigen are the two flagship products of GBC. Kudai is an autonomous AI agent designed to optimize capital in real time. It has gone through different development stages from learner to investor, trader, and then allocator. Currently, Kudai is moving to the next stage, evolving from passive investment to active market participation with enhanced strategies and higher autonomy. After the success of Kudai, the GBC team established Kaigen, a democratized AI-driven Decentralized Finance investment management platform. Kaigen allows users to create personalized AI agents that can continuously execute, optimize, and adjust investment strategies directly from the user's Wallet, without the need for intermediaries. Vee said: AI is not only changing Decentralized Finance, it is revolutionizing our interaction with the entire network. We are witnessing a transformation, where intelligent agents are becoming intermediaries that can analyze, optimize, and automate complex processes, making the system more efficient and user-friendly. GBC chose to build on Arbitrum due to its mature Decentralized Finance ecosystem, especially the synergistic effect with GMX. Vee said that Arbitrum's technical capabilities, including fast and cost-effective transactions, strong security, and compatibility with core Decentralized Finance infrastructure, influenced this choice. Support from programs like Trailblazer provided by Arbitrum further validated this decision, demonstrating alignment with GBC's vision for AI-enhanced Decentralized Finance. Aikaverse Aikaverse, developed by the Fanko team, allows users to buy and sell Cryptocurrency directly on X without the need for a Wallet or website. Users can seamlessly interact with transactions through AI agents. 'Integrating AI technology is the best way to simplify people's first experience with Cryptocurrency. By simplifying the complex Decentralized Finance process into a few intuitive steps, AI has the potential to open up Decentralization finance to everyone, not just native Cryptocurrency users,' said Raz.dmt. Raz.dmt stated that the team chose to build on Arbitrum because of its low fees...