While AI is being touted as the latest hype in Silicon Valley, replacing crypto, it’s worth acknowledging that the hype surrounding crypto has likely just faded because its prices have declined steeply over the last 15 months.
This is nothing new, as crypto prices have fluctuated heavily since their creation over 13 years ago, with periods of intense hype during the bull markets and a lot of “FUD” during the bear markets.
However, what makes AI impressive is its immediate usefulness and rapid adoption. As a result, people are increasingly incorporating AI into their daily lives to aid them in their work and other activities.
In contrast, while tens of millions of people own crypto, it has yet to experience widespread adoption for daily use in things like payments and smart contracts. Instead, crypto is still most commonly used for speculation and investing.
But how could AI impact crypto itself, and what are the top names in crypto utilizing AI? This article explores just that and will show how AI-based cryptocurrencies are leading the pack in the most recent crypto price rally.
A Look at the Top AI Cryptocurrencies
According to sites like CoinMarketCap and CryptoSlate, some leading AI cryptocurrencies (by market cap) include The Graph, SingularityNET, Fetch.ai, Ocean Protocol, and Numeraire. Here’s how each of these uses artificial intelligence.
Numerai is a hedge fund that uses machine learning to try and predict the stock market as accurately as possible. It hosts machine-learning tournaments and incentivizes 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 utilizes AI to simplify searching and retrieving data from blockchain networks like Ethereum. The protocol allows developers to quickly and easily query specific data without needing a centralized entity. Open APIs on The Graph, known as subgraphs, can be built and published by anyone, allowing easy data access. Given how AI plays a central role in web2 applications like Google search, the convergence of AI and web3 is also critical.
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-driven solutions will, someday, facilitate the formation of open-sourced, decentralized human-level intelligence that serves the common good. Using blockchain, they hope to create an equitable global network where value, power, and technology are equally distributed.
Fetch.ai is paving the way for a decentralized future by using machine learning and blockchain technologies to facilitate 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 allocate funds to a $100 million grant program intended to develop Web3, AI, and decentralized technologies for real-world use cases.
Ocean Protocol (OCEAN)
Ocean Protocol aims to address a critical issue in our data-driven society. This project, governed by a Singapore-based non-profit foundation, seeks to distribute the immense value data creates equitably through its platform. Currently, a few large organizations with massive data assets and powerful AI capabilities monopolize the benefits of data, which Ocean believes threatens a free and open society. Instead, Ocean Protocol aims to promote the fair use of data and ensure that it is leveraged for the betterment of all.
What Do Influential Figures in Crypto Think About AI?
Most leaders in the crypto industry have yet to express substantial views on how AI might impact their respective projects. However, with the current buzz surrounding 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 quickly and is a helpful programming aid, but still far from replacing human programmers.
- Charles Hoskinson: In a tweet, he revealed his use of AI to create art. He remarked, “I can’t imagine how amazing this technology will be in three years.”
- Sandeep Nailwal: The Polygon co-founder called for a DAO version of ChatGPT in a tweet, stating it’s too powerful to be controlled by a single entity.
- Binance: In a recent blog, the company states that ChatGPT could help crypto adoption by providing a conversational educational tool, improving customer support, and even aiding with smart contract coding.
How the Hype Surrounding AI Is Affecting Crypto Prices
While crypto, on the whole, has been rallying from lows for the last month or so, traders have been gambling on AI-related cryptocurrencies outperforming, and they have been doing so. Here’s how the five AI cryptocurrencies we looked at earlier have performed versus Bitcoin since January 2023:
- Bitcoin: +41.00%
- Numeraire: + 58.05%
- The Graph: + 179.98%
- Ocean Protocol: +144.74%
- SingularityNET: +808.17%
- Fetch.ai: +376.85%
However, it’s hard to tell if AI cryptos will continue outperforming or if the hype will fade and prices will retrace.
For example, BuzzFeed (BZFD) rallied 350% on the stock market in two days after reporting that they would use ChatGPT to help them create content. However, prices retraced quickly after, and BZFD is now only up around 70% since making the announcement, and its price could continue lower.
In the crypto space, the gameFi token Cocos-BCX rallied more than 250% in five days after merely mentioning AI in a suggestive tweet:
🥥 🤖 COCOS + AI = ? 🚀🔥#CocosBCX #COCOS #BNB
— Cocos-BCX (@CocosBCX) February 8, 2023
So far, COCOS-BCX has maintained its rapid gains.
While there will likely be potentially profitable opportunities ahead for investors and traders in AI-related coins, there has also been a notable rise in scams attempting to exploit the AI trend. For example, numerous fraudulent “ChatGPT” coins have been launched recently for pump and dump schemes, similar to the fake “Squid Game” token we saw in 2021.