Mindshare-led investment strategies impact retail investors

Crypto moves at breakneck speed. New narratives dominate retail investor mindshare every market cycle. And critics demonize shifting investment patterns as a short-term, speculative frenzy that harms the industry’s growth potential.

However, early investors who get into narratives with the highest mindshare accelerate innovation and growth. Unlike VCs and institutions who wait for ‘due process,’ retailers bring the necessary liquidity and attention to emerging industry narratives. They must be encouraged for the industry’s sustainable and holistic growth rather than vilifying mindshare-led investing patterns.

Mindshare-driven investing is good practice

In 2024, AI emerged as one of the top categories occupying investor mindshare, with over 50% dominance across all market narratives. The growth of AI-related sectors like DeFAI with over 7,000 projects and a peak $7 billion market cap, AI infrastructure protocols, and thousands of AI agents, testifies to the mindshare dominance.

Early investors who have rearranged their portfolios and allocated funds to AI-related tokens have made substantial gains as the industry matured. 

Analysts who think investing in a category with the highest mindshare is a get-rich-quick scheme are wrong. On the contrary, mindshare-based investing helps identify potentially disruptive and innovative sectors to supply capital for supporting their growth and earn long-term dividends.

For example, consider AI agents, one of the top categories where retail investors have deployed capital. The market cap of AI agents was just $4.8 billion in October 2024. But soon after the Goatseus Maximus (GOAT) token launch on Solana, the market cap of AI agent tokens rose by 322% to $15.5 billion by December 2024.

AI Agents aren’t a speculative fad. Neither are they merely glorified bots shitposting on social media. Investing in AI agents means leveraging capital to develop futuristic financial applications.

Agentic AIs can reshape digital finance by performing complex tasks within web3 apps and autonomously interacting with users. Eliza, ai16z’s agent, already manages an onchain liquidity pool with over 60% annualized returns.

Early use cases for AI agents range from automated trading bots to wallet and transaction management systems. As the technology develops, AI agents will interact with smart contracts, make market data-based decisions, stake tokens, and improve customer service. The capital deployed through tokens helps build the underlying infrastructure for these agentic AIs.

Over 10,000 web3 AI agents earned millions of dollars from on-chain activities in 2024. According to VanEck’s 2025 crypto predictions report, there can be a million agents by the end of this year. Consequently, the market capitalization of AI agent tokens will reach $60 billion, per Gracy Chen, CEO of Bitget.

The AI agent boom demonstrates it is anything but a short-term investment. Rather, investors who take cues from the dominant mindshare narrative and invest early, deploy capital into future technology. They profit when the industry develops more viable, real-world utilities for consumer-facing applications.

To date, most of the capital in the AI agent market has come from retail investors. This trend demonstrates the power of retail capital in fuelling technical innovations without funding assistance from VCs.

Towards a mindshare-led retail investing era

According to a recent panel discussion at Consensus 2025, VC firms are yet to invest in AI agents despite their initial enthusiasm. Most VC executives think AI agents are “not investable yet” because they’ll take “a bit of time to get there.”

The lack of VC funding despite the rapid development of AI agents shows the parochial nature of VC-led capital raising. Following a market share-driven investing approach, VCs wait until an industry is ripe enough to provide predictable and substantial balance sheet profits to its board members.

Whereas with mindshare-driven investing, retailers provide the necessary capital to kickstart operations, support early-stage innovations, and sustain growth. AI agents occupy high mindshare among retailers because they enjoy a symbiotic relationship, reinforcing each other’s growth.

Protocols like Virtuals empower non-technical people to create, deploy, and monetize AI agents. This creates a positive feedback loop as retailers benefit from innovative agents while AI maintains mindshare dominance.

Therefore, by rejecting VC-led high FDV tokens, retailers have seized the opportunity in the AI agent market. It is no surprise that retailer investors hold the maximum number of AI agent tokens on Solana and Base, with almost 50% mindshare, respectively.

Investor attention becomes the most valuable currency when multiple narratives compete for limited mindshare and capital reserves. Retailers leverage this currency to foster the development and growth of the sector that’ll benefit them the most.

Mindshare-driven investing converts people from passive to active investors as they control the narrative through continuous portfolio management. Instead of relying on VCs and KOLs, retail investors actively shape the market narrative by deploying capital toward cutting-edge tech innovations.

Despite ongoing market corrections and uncertain macroeconomic conditions, specific trends, like AI, will continue to dominate investor mindshare due to their long-term utility. And there’s a premium in identifying and getting into such narratives early.