Cryptocurrencies related to artificial intelligence technology rose in price as Nvidia shares rose

Nvidia has helped cryptocurrencies grow again. What's going on
Cryptocurrencies related to artificial intelligence technology rose in price as Nvidia shares rose
We tell you how the record rise in the graphics processor maker's stock and the artificial intelligence boom affected crypto-asset prices

Nvidia was the first graphics processor maker with a market capitalization close to $1 trillion. Its devices were recently used by cryptocurrency miners, but now its stock rose on the boom in artificial intelligence technology.

Nvidia's stock price soared more than 24% to an all-time high on Friday, May 26. The company said in its quarterly report that the proliferation of artificial intelligence technology is generating record sales and that its net income for the quarter was well above what analysts had predicted.

Nvidia's developments have gained traction in the video game industry, professional visualization, high-performance computing, and the automotive industry, where Nvidia onboard computers are used as the basis for unmanned cars. The company supplies technology to major market players such as Apple, Microsoft, Alibaba, and Amazon.

In late 2006, Nvidia allowed third-party developers to use the processing power of its graphics processing units (GPUs) not only for graphics optimization but also for other purposes. Nvidia processors are good at a lot of single calculations, and in this, they lose out to central processors, the leading manufacturer of which is Intel.

Nvidia's notable success outside of the video game industry has been in cryptocurrency mining, where GPUs have also proven effective. In 2020, amid rising bitcoin and other cryptocurrency prices, Nvidia surpassed Intel in market value, and its quotes continued to rise, reaching a record high of nearly $330 per share at the end of 2021.

Demand for Nvidia graphics cards was supported by miners assembling Proof-of-Work (PoW) cryptocurrency mining farms from the devices. Ethereum (ETH) has always been the most profitable of these, but last September the developers planned to move it to Proof-of-Stake (PoS). After that, the need for mining to issue new coins disappeared, and miners were forced to switch to much less profitable coins or refused to mine cryptocurrencies using GPUs at all.

The fall of excitement around video card mining, as well as the collapse of the crypto market last year, collapsed Nvidia's shares, but now the wave of AI has reawakened investor enthusiasm. Since the beginning of the year, the company has increased its market share by $220 billion. By comparison, Ethereum has a market capitalization of $228.3 billion. Nvidia stock is up 165% in 2023 alone. Nvidia's capitalization now stands at $939.3 billion, which brings it closer to the $1 trillion mark.

AI and cryptocurrencies
On May 28, Nvidia unveiled several technologies related to artificial intelligence at Computex 2023. These include the Avatar Cloud Engine service, which allows you to give intelligence to side characters in video games, the DGX GH200 supercomputer for generative AI, the Spectrum-X platform for cloud providers, the MGX architecture for creating meta universes, and several others.

The flow of news around Nvidia has also affected the cryptocurrency market. Project tokens, which aggregators categorize as "artificial intelligence," rose in value in less than a week, and some of them showed up to 60% growth. An example of such an asset was the AKT token of the Akash Network project. The developers position it as an open network for trading computing power.

The most capitalized assets in the category also benefited from positive news from Nvidia. The token of the SingularityNET project (AGIX), "the first decentralized artificial intelligence marketplace" powered by the Cardano blockchain, rose in value by 10%. The Fetch.ai (FET) machine learning algorithm platform coin gained more than 6% in less than a week, and the OCEAN token used by the Ocean Protocol data economy project rose nearly 9%.

Similar trends took place in the market at the beginning of the year amid the mass spread of ChatGPT, an artificial intelligence chatbot that continues to enjoy notable popularity, including in the cryptocurrency community.

The largest crypto-asset in the AI category is the Render token (RNDR) of the Render Network project from OTOY. The token has a capitalization of over $900 million, is traded on leading cryptocurrency exchanges, and its price has increased almost sevenfold since the beginning of the year.

OTOY provides cloud-based graphics rendering solutions used by visual effects creators, artists, animators, designers, architects and engineers, according to its website. Its products, which also involve AI, are also used by Meta (the company's activities are recognized as extremist and banned in Russia).

As part of the Render Network project, OTOY developers modified the code of their cloud computing platform for GPU-based rendering so that RNDR tokens could be used to pay for the service, thus creating demand for the asset. The project successfully fit into the so-called narrative of the cryptocurrency market, where a number of assets of the same category react to news even remotely related to their development by changing prices.

In 2021, OTOY released Octane X Classic, a rendering app that also uses Render Network technology, to the App Store, and the project's entry into Apple's app store was a successful marketing move for RNDR. The token has risen more than 60 percent since May 13, when The Wall Street Journal's sources reported that Apple would unveil a mixed reality headset at the WWDC 2023 event in early June. This was largely due to a series of speculations that the device could, in theory, also use some of the Render Network's developments.

Overall, blockchain project coins, which in one way or another involve artificial intelligence, have been the group of the most successful crypto-assets from the beginning of the year in terms of investing, along with tokens from the management of liquid stacking services.

Nvidia has helped cryptocurrencies grow again. What's going on

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