The astrophysical origin of gravitational wave (GW) events discovered by LIGO/VIRGO remains an outstanding puzzle. In active galactic nuclei (AGN), compact-object binaries form, evolve, and interact with a dense star cluster and a gas disk. While most binaries are soft and get disrupted by binary-single interactions, an important question is whether and how binaries can merge in these environments. To address this question, we have performed one-dimensional N -body simulations combined with a semi-analytical model which includes the formation, disruption, and evolution of binaries self-consistently. We point out that binaries can form in single-single interactions by the dissipation of kinetic energy in a gaseous medium. This "gas capture" binary formation channel contributes up to 97 % of gas-driven mergers and leads to a high merger rate in AGN disks even without pre-existing binaries. We find the merger rate to be in the range ∼ 0.02 − 60 Gpc −3 yr −1 , whose high end corresponds to top heavy initial mass functions, highly anisotropic initial BH distribution, short AGN lifetime, and large AGN disk sizes. The results are insensitive to the assumptions on gaseous hardening processes: we find that once they are formed, binaries merge efficiently via binary-single interactions even if these gaseous processes are neglected. We find that the average number of mergers per BH is 0.4, and the probability for repeated mergers in 30 Myr is ∼ 0.21 − 0.45. High BH masses due to repeated mergers, high eccentricities, and a significant Doppler drift of GWs are promising signatures which distinguish this merger channel from others. Furthermore, we find that gas-capture binaries reproduce the distribution of LMXBs in the Galactic center, including an outer cutoff at ∼ 1 pc due to the competition between migration and hardening by gas torques.