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With Bitcoin reaching a new ATH (all-time high) in March 2024, the crypto market has truly entered a bullish cycle.
The SEC’s approval of Bitcoin ETFs, growing interest from institutional investors and regulatory clarity have pushed BTC over 150% since last year.
Yet, Bitcoin’s rally in this bull market is largely overshadowed by the remarkable growth of AI-based tokens.
Data from CoinMarketCap shows that AI tokens currently hold a market cap of $41.5 billion, with some of the major tokens recording 10 times the growth of Bitcoin in the past year.
So, why are AI (artificial intelligence) tokens suddenly the crypto market’s new favorites? And which tokens are potentially winning this bull market?
Analyzing the rapid rally of AI tokens
AI tokens first took off in early 2023 after ChatGPT launched the GPT-4 module, marking a new era in generative AI advancements.
Throughout 2023, such tokens saw gradually growing interest from traders, with more industry giants like Microsoft and Google launching their own AI initiatives and development plans.
The idea that AI is truly the building block of all future technologies is becoming evident through these industry initiatives.
So, naturally, as the crypto industry is always reactive to significant technological advancements, the interest in such tokens grew consistently throughout the year.
However, trading interests in AI tokens saw parabolic growth in January 2024, driven by several factors.
The launch of OpenAI’s Sora, a text-to-video model, showcased AI’s truly next-gen capabilities.
At the same time, OpenAI’s rival, Anthropic, received nearly $3 billion in investment in its latest funding round.
These developments saw interest in AI tokens increase dramatically, with trading volume across various exchanges surging over 400%.
Nvidia also reported its fourth-quarter earnings in February 2024 that exceeded expectations, with earnings per share and revenue surpassing Wall Street’s predictions.
Nvidia’s success is a barometer for the tech industry at large, particularly for sectors involved with AI and machine learning.
The company’s strong performance can signal robust health and innovation in these areas, which directly benefits AI-related tokens in the crypto market.
Another key factor was Vitalik Buterin’s endorsement of AI as the future of blockchain security.
The Ethereum co-founder suggested we can leverage AI technology to improve code…
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