AI tokens ride the crypto volitality as major players bet big on AI amid economic shifts.
TL;DR…
- Bittensor (TAO) leads the pack: Up 15.81% this week, while Internet Computer (ICP) struggles with a 9.78% drop.
- OpenAI’s o1 model released: Featuring better reasoning and coding skills, alongside Hong Kong’s AI finance rules coming soon.
- Major AI investments coming: BlackRock and Microsoft commit $30B to AI infrastructure, hinting at future bullish momentum in the sector.
It’s that time again!
We’re back for another roundup of what’s hot in the crypto AI space. Did you miss last week’s update? Check it out here.
Let’s dive in.
What’s Happening in Crypto AI
As one of the most volatile asset classes, cryptocurrencies are well known to experience wild swings in value.
Indeed, Bitcoin has become increasingly volatile over the last year, driven by prevailing economic uncertainty. Its 30-day volatility index currently stands at 1.96% — up from 1.19% a year ago.
Nonetheless, Bitcoin is still flirting around the $64,000 price point after a sudden burst of interest after the FOMC meeting (more on this later).
AI tokens have felt the backsplash of this, with many demonstrating erratic price action in recent weeks, largely driven by waves of FUD and FOMO.
Not up-to-date on your crypto lingo? Check out the CoinMarketCap Crypto Glossary.
In the last 7 days, 7 of the top 10 largest AI tokens have experienced growth.
Bittensor (TAO) stands out as the best performer, clocking in an impressive 15.81% growth in the last week. Whereas Internet Computer (ICP) has taken quite some punishment, down 9.78% over the same period.
The average AI token is now up 2.38% for the week, compared to the market average of 3.5%.
According to DefiLlama's narrative tracker, the AI sector has lost some market share in the last week, while sectors like meme coins, data availability layers and GameFi have seen a recent uptick.
Weekly News Roundup
As one of the fastest-growing sectors today, there is always an assortment of hot news, updates and interesting developments to explore.
Here, we’ve assembled the most prominent stories to help you catch up fast.
- OpenAI releases new o1 model: OpenAI's long-awaited o1-preview model (formerly known as 'Strawberry') features enhanced reasoning, mathematical capabilities and coding abilities. It is now available as an option for Plus users in ChatGPT.
- Artificial Super Intelligence (FET) expands to Cardano: The Artificial Superintelligence Alliance updated the SingularityNET bridge to support seamless FET token transfers between Ethereum and Cardano. Moreover, the ASI Alliance may be set to merge the CUDOS blockchain pending a community vote ending September 24, 2024.
- Hong Kong considers AI policy: Hong Kong is preparing to release its first AI policy for the financial sector in October 2024. The new regulations will focus on the ethical use of AI in key areas like trading, investment banking and cryptocurrency.
- BlackRock and Microsoft in $30 billion AI push: The two firms will join forces with the Abu Dhabi-backed investment company MGX to invest more than $30 billion in AI infrastructure, energy projects and data centers.
- World Labs raises $230 million for 'Spatial Intelligence' systems: Frequently billed as the "Godmother of AI", former Google Cloud AI exec Fei-Fei-Li is working to build a new type of AI system known as a "Large World Model" or LWM. The new model will be able to understand 3D environments and act/react accordingly to what they perceive.
- Morpheus Networks wins AI challenge: Morpheus Network won the AI Challenge at the All In Canada conference for its innovative use of AI and blockchain to improve global supply chains.
Upcoming Bullish Events
As many are painfully aware, September is historically the worst month of the year for cryptocurrencies, with the month frequently referred to as “rektember” for obvious reasons.
But so far, it’s unclear whether crypto markets will close in the red this month. As it stands, Bitcoin is up 1.19% this month whereas the average altcoin is up 3% in the same time.
Nonetheless, there are several bullish catalysts lined up, which could be set to add some rocket fuel to the market.
For one, there’s the FOMC meeting last week. At the meeting, the Federal Reserve announced the first interest rate cut in 4 years.
Historically, successive rate cuts (in the absence of a recession) have been bullish for the economy, since lower borrowing costs lead to investors taking on more risk. This is particularly apparent for risk-on assets like cryptocurrencies which typically suffer most during times of economic uncertainty.
Meanwhile, the 2024 Presidential Elections are now just a few weeks away. Many believe that Trump's victory will be particularly bullish for the crypto industry since the candidate has expressed clear views on enacting more favorable regulations for cryptocurrencies in the U.S. and establishing the country as a hub for crypto progress.
Lastly, if Bitcoin follows the previously observed 4-year cycle, it could now be just days away from a meteoric breakout.
Given that Bitcoin dominance is at its highest value in 2 years and AI tokens now have significant mindshare, it stands to reason that fundamentally strong AI tokens will be among the biggest winners in a true bull market.
