3 Types of AI Crypto Tokens I’m Avoiding Right Now

Given the spectacular popularity of ChatGPT, it is perhaps not surprising that AI crypto tokens are rising in price this year. Everyone wants a piece of this hot new niche. The most popular crypto AI token, SingularityNET (AGIX 8.95%), is up an impressive 815.27% this year. Another popular AI crypto token, Fetch.ai (OILY 7.00%)is up 295% this year.

But be careful what you buy. Some that claim to be AI tokens are actually just older crypto tokens that have been renamed to capitalize on the latest buzzword. And some of the tokens with “GPT” or “AI” in their names or ticker symbols may hype more than they can deliver. With that in mind, here’s a closer look at three types of AI crypto tokens I’m avoiding right now.

1. Cryptos feed directly into ChatGPT’s success

There have been a number of media articles and press releases involving crypto tokens and ChatGPT recently. For example, on March 15, just one day after OpenAI announced the release of the new ChatGPT-4, The graph (GRT 10.33%) announced that it would integrate ChatGPT into how it analyzes data from across the web.

Image source: Getty Images.

I’m always skeptical of these kinds of announcements, especially when social media influencers start using them to hype a token online. Even The Graph acknowledged in its ChatGPT announcement (“Using AI to Enhance the Graph Network”) that using a large-language model like ChatGPT (which analyzes text) is not a direct match for what The Graph is trying to do with blockchain data, and may be more difficult to obtain than one might think.

2. Cryptos try to rebrand AI

While pivots and reboots are good, I’m also a bit cynical about what some tokens are doing these days to position themselves as AI crypto tokens. Some of these tokens date back to 2017 or 2018 and now they are suddenly “AI crypto tokens”? I especially take issue with cryptos that were “Web3” or “metaverse” tokens just 24 months ago by adopting the “AI” label. Whenever I hear about a new AI crypto token, I always do my due diligence.

3. Cryptos you can’t explain in 2 minutes or less

Finally, avoid crypto that you can’t explain so your grandma will understand. If the elevator pitch for a crypto involves a lot of jargon like “data tokenization,” you might want to reconsider buying it. In this regard, you can learn a lot from billionaire investor Warren Buffett, who advises you to invest in what you know.

So which cryptos are worth buying?

By using these three simple rules, it is possible to significantly reduce the list of AI crypto tokens you might want to invest in. Right now, I am particularly bullish on SingularityNET (AGIX 8.95%)mostly because SingularityNET (the company) has a track record of coming up with world-class AI development. If you recognize Sophia the Robot, then you are familiar with SingularityNET. Also, SingularityNET has a quick, easy way of describing itself that makes intuitive sense: it’s “Fiverr for AI.”

That said, I can see why some people might be skeptical of SingularityNET. First, the name is a clear reference to one of the most hyped and anticipated potential events in AI: the technological singularity. And the name of the token is a clear reference to the goal of supporting the development of an “artificial general intelligence” (AGI). So it might look like this token is trying too hard to be relevant to AI investors. Also, if you check out CoinMarketCap, you’ll see that the AGIX token has been around since 2017, another potential red flag. Why did it take until 2023 for this token to go parabolic? Finally, the fact that AGIX is up 800% in just three months may be a warning sign that it has skyrocketed too far, too fast.

But guess what? The size of the AI ​​market is so staggeringly large that I think SingularityNET has just begun to scratch the surface of what is possible. Even with a market cap of $500 million, it could be undervalued by several orders of magnitude if AI achieves what many believe it will. As a result, I am positive long-term on SingularityNET.