A new trend in the market. Why AI coins are skyrocketing in price
How the popularity of the field of artificial intelligence among investors affects the prices of cryptocurrencies
ChatGPT, an AI-powered chatbot with a billion-dollar investment from Microsoft, gained 100 million users in January, becoming the fastest-growing Internet app in history. According to analysts at UBS, a bank holding company led by Lloyd Walmsley, the market for generative AI could be "extremely large" and easily "pass the trillion dollar mark," Bloomberg writes.
Such hype and much speculation about what OpenAI's could mean for the technology and business sphere is already familiar to those who have been following the cryptocurrency industry since at least 2021. During each of the bullish periods in the crypto market, there are many headlines in the mainstream media about how blockchain technology and cryptocurrencies in particular will be a breakthrough for the world.
In early 2023, digital currencies and artificial intelligence have spawned a unified narrative in the crypto-asset market, and the domestic tokens of AI-related development projects continue to rise in value.
Cryptocurrency mogul Justin Sun, head of the Huobi exchange and creator of the Tron (TRX) coin, posted on Twitter the idea of a mechanism to create an "AI-centric decentralized payment system" for ChatGPT.
According to his idea, such an environment would create a decentralized payment system "that would be safe, secure, tamper-proof, censor-proof, and capable of supporting AI." It would build a new decentralized smart financial ecosystem, Sun wrote in a series of trending keyword-filled tweets outlining the plan.
Tokens rise in value
Overall, coins from blockchain projects that involve artificial intelligence in one way or another have been the group of the most successful crypto-assets in terms of investing since the beginning of the year, along with tokens from the management of liquid-stacking services.
The leader in terms of market capitalization in the category, according to CoinGecko, is the SingularityNET project coin (AGIX). During the last week alone, the asset increased in value almost 2.5 times, reaching the mark of 45 cents, although it was trading at 7 cents less than a month ago. The developers of the service position it as "the first decentralized artificial intelligence marketplace" based on Cardano blockchain. At the time of publication, AGIX's capitalization exceeds $542 million.
Tokens from the other most capitalized projects in the category also continue to rise, despite the short-term decline in bitcoin and the crypto market as a whole. The machine learning platform Fetch.ai (FET) has gained more than 65% in value over the past month, and the OCEAN token used by the Ocean Protocol "data economy" project has more than doubled since the beginning of January.
Interestingly, projects with relatively low market capitalization are also included in the "narrative. Due to their lower liquidity, large purchases of their tokens inevitably lead to strong price hikes. Thus, the rate of AIRI token belonging to the barely known platform aiRight, whose developers claim to use AI to create non-interchangeable tokens (NFT), increased several times in just one day. A similar scenario was observed with the IMGNAI token, created to pay for the creation of anime-style images by a neural network project under the unsophisticated name of Image Generation AI.
Not just the crypto market
The success of ChatGPT has sparked a surge in investor interest in AI-based technologies, not just in the crypto market. Last month, the share price of struggling media company Buzzfeed surged after it announced plans to use artificial intelligence to create content. Similarly, shares of little-known public companies soared in price after they added the word Blockchain to their name at the peaks of the crypto market in early 2018 and late 2021.
Experts draw parallels between these scenarios. Speaking to Politico reporters, Sheila Warren, executive director at Crypto Council on Innovation, said that ChatGPT's role is "too exaggerated," comparing the hype around the chatbot to the "early days of cryptocurrency," when similar things happened around blockchain technology.
That said, the hype around artificial intelligence is borne out by the numbers. In January, JPMorgan Bank conducted its annual survey of professional traders about upcoming trends in electronic trading. It surveyed 835 industry representatives from 60 regions around the world.
AI, according to the survey, outperforms all other major categories, with its 53% citation well ahead of API integration (14%) and blockchain (12%). Only 8% of respondents confirmed that they trade cryptoassets.
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