The Rise of the Agent Economy: Autonomous Agent Organizations as a New Form of Economic Infrastructure

Abstract

This paper examines the Virtuals Protocol as a case study in economic innovation enabled by autonomous AI agents. It analyzes how the protocol establishes a comprehensive infrastructure that combines tokenized ownership, decentralized governance, and standardized coordination to support agent-based economic organization. Drawing on transaction cost economics and network economics, the study shows how the protocol reduces coordination costs and amplifies network effects through agent specialization and composability. The concept of Autonomous Agent Organizations (AAOs) is introduced as a functional subclass of Decentralized Autonomous Organizations (DAOs), distinguished by their greater economic autonomy and composable inter-agent collaboration. AAOs represent a novel form of economic organization that transcends traditional boundaries between firms, markets, and platforms. The findings offer theoretical contributions to economic organization theory and practical implications for platform design, governance, and regulatory development. As AI agents become an increasingly prevalent aspect of economic activity, the Virtuals Protocol provides a model for scalable, adaptive, and inclusive economic coordination.