Generative AI tools such as ChatGPT and Midjourney have sparked discussions about the inclusion of AI across the business and technical fields, and AI has even reached the world of cryptocurrencies. As a result, many AI-based crypto projects are currently attracting investor attention.
Links to AI have sparked positive price action for several cryptocurrencies, signaling the rise of new trends in the crypto market. Some investors believe AI coins could be the culmination of previous popular trends such as the DeFi boom, the metaverse coin explosion, and the meme coin.
So what are AI cryptocoins and how will this new trend shape the market?
The impact of ChatGPT on the crypto market
Towards the end of 2022, many AI tools have been released, from image generators to language models. But one of the most influential tools was ChatGPT. OpenAI’s ChatGPT is designed to act like a chatbot and respond to any query like a human. This is one of the language models in the GPT3 family.
The good thing about ChatGPT is that anyone can use it, and it has gained worldwide attention. Additionally, ChatGPT’s rapid success has prompted various major tech companies to step up their efforts to incorporate AI into their businesses.
For example, Microsoft took ChatGPT, struck a lucrative $10 billion deal with OpenAI, and integrated it with internet search engine Bing. In contrast, Google also launched its own AI chatbot Bard to compete with ChatGPT.
But ChatGPT’s frenzy isn’t limited to tech businesses. Thanks to ChatGPT, the cryptocurrency market is also catching up with AI. As a result, many AI-related projects dominate the market. This type of digital asset is classified as “AI Coin”. One good example of this is the surge in The Graph token.
What is AI cryptocoin?
AI coins or tokens are digital assets used for AI-based crypto projects. These coins allow artificial intelligence to be integrated into various projects such as asset management, price forecasting, AI-based his DAO, and fraud detection. Like most crypto tokens, AI tokens are also used to provide governance rights and rewards to users. Additionally, these tokens can also be used to pay transaction fees.
For example, one of the top AI cryptocurrencies, SingularityNET platform AGIX, introduces an AI-based decentralized marketplace. Trade AI products and services in a secure and decentralized environment. AGIX plays a central role in this platform as it is the main payment medium between users and service providers.
Another AI token, Fetch.ai’s FET provides an innovative platform that provides a complete infrastructure for AI systems. You can use the platform to build AI solutions on Web3 and consume services using FET tokens.
On the other hand, many other tokens in this rising genre offer various benefits to users. These cryptocurrencies are still in their infancy, but show tremendous growth potential.
Why did AI cryptocoin suddenly become popular?
Technological developments can play a big role in the movement of the cryptocurrency market. As such, the growth of AI in recent years has impacted crypto projects, with many crypto projects integrating automated systems and artificial intelligence into new Web3 apps.
Additionally, the surge in popularity of ChatGPT, Midjourney, and other AI tools has increased investor interest in these projects and, in some cases, increased prices. For example, data insights from CoinGecko suggest that the ChatGPT and Bard hype has boosted AI token prices by up to 16x.
The ease of use and transparency of AI cryptocurrencies is one of the reasons why traders are enthusiastic about investing in AI cryptocurrencies. Additionally, tech giants are moving quickly to mainstream AI. It also gave people hope that his AI with cryptocurrencies could shape the future of his Web3.
However, the AI crypto market remains small. The AI cryptocurrency market capitalization is currently around $1.6 billion. The upper limit is relatively low when compared to the crypto market as a whole. Still, given that both cryptocurrencies and AI are advancing the field, this is a good start.
How else is AI being used in crypto?
AI crypto coins are all the rage in early 2023, but the use of AI in crypto is nothing new. Automated tools have become part of investment and trading strategies. AI bots for cryptocopy trading are a prime example of the convergence of AI and crypto. These tools allow bots to automatically copy other people’s trades, so you can trade cryptocurrencies without fully understanding them (if you don’t pay attention to the market, you can suffer big losses). There is a possibility!).
Additionally, many other crypto trading tools allow you to use insights from artificial intelligence to develop your trading strategy. AI software is built using complex pre-trained models to guide optimal strategies.
Additionally, some crypto bots enable portfolio management and strategy backtesting, provide insightful metrics, and offer many other features to simplify crypto trading. Popular options include Pionex, Shrimpy.io, Zignaly, and Coinigy.
Possibilities of AI in cryptocurrencies
AI coins have yet to unleash their full potential in the market, but they show a bright future for the fusion of cryptocurrencies and AI. Breakthrough AI technology can also be a game changer for digital assets. Here’s what AI can bring to the crypto space:
- Digital asset price prediction models can save investors from the hassle of blind guessing.
- AI algorithms could also help keep fraud out of the market.
- Blockchain decentralization can be enhanced by limiting human intervention.
- It can help you make informed decisions to avoid putting your assets at risk.
- AI can also help analyze the sentiment of a particular currency by analyzing public opinion on social sites.
- Governments can integrate it into their compliance policies to control money laundering and taxation of digital assets.
What is the future of AI coins?
AI coins have emerged as a genre and are setting new trends in crypto. In many ways, the rise of ChatGPT has fueled the success of these tokens. Currently, crypto projects that offer AI-based blockchain solutions are gaining attention and increasing in value.
However, it is too early to assess the overall impact of AI on cryptocurrencies. AI cryptocoins may become fads like memecoins or change the underlying market dynamics. please.
Information on this website does not constitute financial advice, investment advice or trading advice and should not be viewed as such. MakeUseOf does not advise on trading or investment matters, nor does it advise you to buy or sell any particular cryptocurrency. Always conduct your own due diligence and seek investment advice from a licensed financial advisor.