Avalanche Treasury CEO warns AI agents may strain blockchain capacity

Blockchains have a space problem, and AI agents are about to make it worse. That’s the core argument from Bart Smith, CEO of Avalanche Treasury Company (AVAT), who used a recent podcast appearance to lay out why he thinks the next wave of autonomous software could fundamentally reshape which networks win institutional adoption. Speaking on the July 9 episode of the Layer One podcast, Smith framed the issue in refreshingly blunt terms: blockchain capacity is finite, AI agents are multiplying fast, and networks that can’t isolate workloads will feel the squeeze first. The AI agent bottleneck By mid-February 2026, Avalanche had already recorded over 1,600 AI agents registered under the ERC-8004 standard, actively trading and executing on-chain tasks. Those agents don’t wait for gas prices to drop or congestion to clear. They transact continuously, and their volume compounds as more get deployed. Smith’s point is that this dynamic makes the architectural differences between major chains genuinely consequential. Ethereum and Solana operate as high-traffic shared environments where every application competes for the same block space. When an AI-driven trading bot floods Ethereum with tra...