Is AI Bubble Over? Crypto Whales Exit AI Agent Bets

A crypto whale turned early 2025’s hottest trade into a $28.5 million disaster. The losses came from AI agent tokens bought at peak hype, raising uncomfortable questions about whether the AI bubble narrative is finally catching up to crypto markets.

The whale bought into AI agent fever when sentiment was sky-high. According to blockchain analytics firm Ember, the wallet spent $31.12 million building positions in tokens tied to autonomous trading bots and AI-powered execution systems. Fast forward to today, and those same positions closed for just $2.57 million. That’s a 92% wipeout.

The Bloodbath Breakdown

Token by token, the damage reads like a horror story for believers in the AI agent narrative. The whale lost about 91% on AIXBT, equal to $15.89 million gone. FAI cost another $9.87 million, representing a 92% decline from entry.

Positions in NFTXBT and POLY, both from the Virtuals ecosystem, got nearly wiped out with 99% losses. That’s roughly $690,000 and $780,000 vaporized on those two bets alone.

BOTTO, an AI-driven art and curation project, produced an 84% hit worth about $930,000. MAICRO, another Virtuals-linked token, cost the wallet roughly $380,000 with a 90% drawdown.

The forced selling hammered prices in real time. Ember’s data shows AIXBT falling 10% during the exit, FAI dropping 8%, and NFTXBT sliding 29%. BOTTO sank 32%, MAICRO tumbled 48%, and POLY declined 26% as the whale worked through positions.

Also Read: Is Crypto A Bubble? Bulls Will Definitely lose In 2026

When Liquidity Disappears

Arkham’s blockchain explorer captured the sequence of transfers between the whale address and liquidity pools. Tens of millions of tokens moved in quick succession. The pattern suggests deliberate capitulation rather than gradual rebalancing. The whale chose to lock in catastrophic losses instead of waiting for another wave of AI agent speculation that might never arrive.

For anyone who rode the same narrative, this episode serves as a brutal reminder. AI agent tokens launched into the tail end of broader AI mania. Many never built the depth or organic usage that supports large exits. When attention shifted elsewhere, order books turned skeletal.

The AI bubble concerns dominating traditional markets are now bleeding into crypto. In November 2025, Bank of America’s Global Fund Manager Survey found 53% of fund managers believed AI stocks were in a bubble, while the survey revealed that for the first time in 20 years, fund managers said companies were overinvesting in AI.

Size Cuts Both Ways

The whale’s experience exposes an uncomfortable truth about illiquid markets. The size that drives performance during a rally becomes a liability when liquidity dries up. Every attempt to exit pushes prices lower and erodes whatever value remains.

AI agent tokens hit over $15 billion in combined market cap at their peak. Virtual surged 49,000%, and AI16z rose 8,700% since launch. Those gains pulled in capital from everywhere. But shallow order books mean big holders can’t escape without causing crashes.

Also Read: AI Agents for Automated Yield Farming: The Future of Passive Income in DeFi

The Bigger Picture

Goldman Sachs CEO David Solomon warned at Italian Tech Week that a market drawdown was likely within 12 to 24 months, drawing explicit parallels to the dot-com bubble. Solomon pointed out that whenever new technology creates massive capital formation, markets typically run ahead of potential. He predicted that while some AI investments would deliver attractive returns, many would not.

Google CEO Sundar Pichai said that “no company is going to be immune, including us,” if the AI bubble bursts. Pichai acknowledged there was “irrationality” in the current AI investment boom, though he maintained the technology itself would prove transformational like the internet.

Crypto’s correlation with tech stocks recently hit 80%, the highest in six months. When the Nasdaq dropped 4% in recent trading, Bitcoin fell below $83,000 within hours. The connection between AI bubble fears and crypto performance is undeniable.

The immediate risk for crypto investors is becoming collateral damage in an AI correction. Capital flees risk assets first during sell-offs. Crypto’s higher volatility means it typically falls harder and faster than traditional tech stocks.

What Smart Money Does Now

The whale’s $28.5 million loss isn’t just about one bad bet. It’s a warning about late-stage narratives and the dangers of illiquid positions in speculative sectors. For traders still navigating AI agent tokens, the flush cuts both ways. It cleared stale supply from thin markets, potentially setting up better entries for those willing to take the risk.

But here’s the reality check: many AI agent projects launched without building real utility. They rode hype cycles that bubble skeptics warned about for months. When sentiment cooled, there was nothing underneath to hold prices up.

The longer-term question for crypto is whether decentralized AI alternatives gain traction if centralized AI proves too capital-intensive with unclear returns. That’s a future story. Right now, the AI bubble conversation has crypto investors spooked. A $28.5 million whale loss just made it personal for everyone watching their own AI agent positions.

Also Read: AI x Crypto: The Powerful Revolution That Could Transform 2030

Are AI agent tokens worth buying after this crash? 

Extreme caution is warranted. While some leading projects still have active development, the sector faces serious liquidity challenges and renewed skepticism. The whale’s loss shows even large, presumably sophisticated investors can face catastrophic losses when narratives shift and order books thin out.

How does the AI bubble affect Bitcoin and Ethereum? 

Bitcoin and major cryptocurrencies now show roughly 80% correlation with tech stocks. When AI bubble fears trigger tech sell-offs, crypto typically falls harder due to higher volatility and its classification as a risk-on asset.

What can retail investors learn from this whale’s mistakes? 

Don’t chase late-stage narratives, understand liquidity constraints before building large positions, and recognize that hype without underlying utility rarely ends well. The AI agent sector demonstrated how quickly sentiment can shift when projects lack fundamental value.

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Disclaimer:

Look, we’re just journalists reporting the news here, not your financial advisors. Everything you read above is for information purposes only. Crypto is wild, unpredictable, and can absolutely wreck your savings if you’re not careful. Never invest money you can’t afford to lose. Seriously, we mean it. Do your own research, talk to actual licensed financial professionals, and remember that past performance means absolutely nothing when it comes to future results. The crypto market can turn on a dime, and what’s hot today might be toast tomorrow. We’re not responsible for your investment decisions, good or bad. Trade smart, stay safe, and don’t bet the farm on anything you read on the internet, including this article.