Boom of crypto tokens linked to artificial intelligence (AI)

The tokens related to artificial intelligence (AI) in the crypto markets are performing increasingly well. 

AI, or artificial intelligence, is the current “trend” in financial markets, especially in traditional ones, and crypto tokens linked to AI are taking advantage of it. 

Although it is not just a trend, the one in the crypto markets still appears as a temporary speculative bubble. 

The case of Worldcoin (and Nvidia)

Today the price of the WLD token of Worldcoin has reached its all-time high of over 8.7$.

WLD is a young token, landed on the crypto markets only after the middle of last year, but the real boom was recorded in February of this year. 

Indeed, after rising to over $4 at the end of 2023, in January it had also dropped below $2.5. 

Starting from February 8th, it began to rise, with a real surge starting from last Friday. 

This parable has to do with that of the Nvidia title on traditional stock exchanges, and in particular with what happened yesterday.

Nvidia is absolutely the reference stock at the moment for the AI sector, and WLD is the reference token for AI in the crypto sector.

The curious thing is that the Worldcoin project is not an artificial intelligence project, even though it uses some AI tools for retina scanning, but it was founded and is led by Sam Altman, the CEO of OpenAI who sparked the artificial intelligence boom last year with ChatGPT.

However, while Nvidia’s stock performance may have solid foundations, despite the price-to-earnings ratio of its shares being much higher than average, WLD’s performance may not have particularly solid bases. In this case, it could simply be a passing speculative bubble. 

The boom of Nvidia in AI

Leading the race of AI stocks is Nvidia, the world’s leading manufacturer of powerful chips used by machines that leverage artificial intelligence.

The first boom occurred in 2023, especially in view of future development prospects, but it is in January 2024 that it recorded the most suspicious recovery. 

Last night, the data on sales and profits for the fourth quarter of 2023 were expected, and it was thought that they could have triggered the speculative mini-bubble of 2024. 

Instead, the data turned out to be better than expected, and so in after-hours trading the stock recovered all the losses from the previous days due to doubts about the sustainability of these price levels. 

Therefore, as of today, there is no sign of a possible collapse of Nvidia’s stock in the short term, while until last night this hypothesis was still circulating insistently. 

At this point, it is possible that the AI rally continues, as shown by the trend of WLD, or at least stabilizes at very high levels. 

This does not exclude the possibility that in the future, if the data is lower than expected, the mini-bubble could still burst.

Not only WLD: the boom of AI (artificial intelligence) tokens thanks to NVIDIA’s stock

In the crypto markets there are also other tokens linked to AI. 

After yesterday’s news about Nvidia’s profits, many saw significant price increases. 

AGIX from SingularityNet has grown by over 20%, FET from FetchAI by over 10% and RNDR from Render by 8%. However, in total, the AI tokens taken together do not reach the 17 billion dollars in market capitalization, excluding WLD which has a market capitalization of 1.1 billion but technically is not an AI token. 

Note that none of these tones have recorded absolute highs, only WLD. 

FET is still only down by -6% from its highs, while RNDR is down by -17%. 

However AGIX is still at -63%, while NEAR is at -84% and GRT is at -90%. 

The point is that these are tokens that are not intimately connected to the world of artificial intelligence, but are indirectly related to it.

Furthermore, the token that is performing the best, Worldcoin, does not have anything to do with AI, except for the fact that it uses some artificial intelligence tools.

All this should raise some doubts about these market performances, because it is not at all certain that the bases on which these tokens move are really serious and solid.

To put it better, maybe they are also serious and solid in some cases, but they are not so intimately linked to the development of artificial intelligence. The only one that seems to be an exception is FET, with RNDR following closely behind.

The Bitcoin movement

Interestingly, what happened yesterday in the markets to AI-related financial assets also benefited Bitcoin.

Actually, it is possible that Tuesday’s drop below $51,000 was due to concerns spreading in the traditional markets regarding Nvidia’s data release. 

If that’s the case, then it easily explains why last night the price of BTC returned close to $52,000. 

At this point, the same speech as before could be worth it: the correction has already taken place, but now that doubts have been dispelled, a new period of recovery or at least lateralization at very high levels could begin.