Examining the hype and latest price trends
While AI is being touted as the latest hype in Silicon Valley, replacing crypto, it’s worth acknowledging that the hype around crypto has probably just faded because prices have fallen sharply over the past 15 months.
This is nothing new, as crypto prices have fluctuated wildly since their inception over 13 years ago, with periods of intense hype during bull markets and a lot of “FUD” during bear markets.
What makes AI impressive, however, is its immediate utility and rapid adoption. As a result, people are increasingly incorporating AI into their everyday lives to help them in their work and other activities.
In contrast, while tens of millions of people own crypto, it has yet to see widespread adoption for everyday use in things like payments and smart contracts. Instead, crypto is still mostly used for speculation and investment.
But how might AI affect crypto itself, and what are the top names in crypto using AI? This article explores just that and will show how AI-based cryptocurrencies are leading the pack in the latest crypto price rally.
A look at the best AI cryptocurrencies
According to sites like CoinMarketCap and CryptoSlate, some leading AI cryptocurrencies (by market capitalization) include The Graph, SingularityNET, Fetch.ai, Ocean Protocol, and Numeraire. Here’s how each of these uses artificial intelligence.
Numerai (NMR)
Numerai is a hedge fund that uses machine learning to try to predict the stock market as accurately as possible. It hosts machine learning tournaments and encourages top data scientists to participate by rewarding those with the most accurate models with Numeraire (NMR) tokens. To date, Numerai has paid out $53 million in NMR to data scientists.
The Graph (GRT)
The Graph Network is a decentralized indexing protocol that uses AI to simplify the search and retrieval of data from blockchain networks such as Ethereum. The protocol allows developers to quickly and easily search for specific data without needing a centralized entity. Open APIs on The Graph, known as subgraphs, can be built and published by anyone, providing easy data access. Given how AI plays a central role in web2 applications such as Google search, the convergence of AI and web3 is also critical.
SingularityNET (AGIX)
SingularityNET is trying to usher us into the era of decentralized AI. As a leading AI marketplace powered by blockchain, its core mission is to develop beneficial artificial general intelligence (AGI). With SingularityNET, AI-powered solutions will one day facilitate the creation of open source, human-level decentralized intelligence that serves the community. By using blockchain, they hope to create a fair global network where value, power and technology are equally distributed.
Fetch.ai (FET)
Fetch.ai is paving the way for a decentralized future by using machine learning and blockchain technologies to provide an alternative to the currently restrictive, centralized data silos. Their mission is to allow anyone to create and deploy AI services at scale, potentially transforming multiple industries. Recently, Bosch partnered with Fetch.ai and agreed to fund a $100 million grant program aimed at developing Web3, AI and decentralized technologies for real-world use cases.
Ocean Protocol (OCEAN)
Ocean Protocol aims to address a critical problem in our data-driven society. This project, managed by a Singapore-based non-profit foundation, seeks to distribute the enormous value data creates fairly through its platform. Currently, a few large organizations with vast computing resources and powerful AI capabilities monopolize the benefits of data, which Ocean believes threatens a free and open society. Instead, the Ocean Protocol aims to promote the fair use of data and ensure that it is used for the good of all.
What do influential figures in Crypto think about AI?
Most crypto industry leaders have yet to voice significant views on how AI might impact their respective projects. But with today’s buzz around AI and ChatGPT, several influential figures have taken to social media or blogs to air their thoughts. Here’s what some of them had to say:
- Vitalik Buterin: In a recent blog, he shared his experience testing ChatGPT to help him code. Vitalik concluded that AI is improving rapidly and is a useful programming aid, but still far from replacing human programmers.
- Charles Hoskinson: In a chirping, he revealed the use of AI to create art. He noted, “I can’t imagine how amazing this technology will be in three years.”
- Sandeep Nailwal: The Polygon co-founder asked for a DAO version of ChatGPT in a chirpingand says it is too powerful to be controlled by a single device.
- Binance: In a recent blog, the company states that ChatGPT can help crypto adoption by providing an educational chat tool, improving customer support and even helping with smart contract coding.
How the hype around AI affects crypto prices
While crypto, as a whole, has rallied from lows over the past month or so, traders have been gambling on AI-related cryptocurrencies that have outperformed, and they have. Here’s how the five AI cryptocurrencies we looked at in the past have performed compared to Bitcoin since January 2023:
- Bitcoin: +41.00%
- List of numbers: + 58.05%
- The graph: + 179.98%
- Ocean Protocol: +144.74%
- SingularityNET: +808.17%
- Fetch.ai: +376.85%
However, it is hard to say if AI cryptos will continue to outperform or if the hype will die down and prices will go back.
For example, BuzzFeed (BZFD) surged 350% in the stock market in two days after reporting that they would use ChatGPT to help them create content. However, prices rebounded quickly afterwards and BZFD is now only up about 70% since the announcement, and the price could continue lower.
In the crypto space, gameFi token Cocos-BCX surged more than 250% in five days after merely mentioning AI in a suggestive tweet:
🥥 🤖 COCOS + AI = ? 🚀🔥#CocosBCX #COCOS #BNB
— Cocos-BCX (@CocosBCX) 8 February 2023
So far, COCOS-BCX has maintained its rapid gains.
While there are likely to be potentially profitable opportunities ahead for investors and traders in AI-related coins, there has also been a notable increase in scams attempting to exploit the AI trend. For example, many fake “ChatGPT” coins have recently been launched for pump and dump schemes, similar to the fake “Squid Game” token we saw in 2021.
