Grayscale Launches AI Crypto Sector Amidst Market Surge
The cryptocurrency market is witnessing a surge in AI-related coins following Grayscale Investments' announcement of its new "AI crypto sector." This comes as the AI crypto market has experienced remarkable growth, expanding 4.5 times in the last two years, from $4.5 billion to over $20 billion. Grayscale highlights the increasing prominence of decentralized AI, rivaling its centralized counterparts and capturing significant market attention.
AI Coin Prices Surge on Grayscale News
The news sparked a rally in AI-focused cryptocurrencies. For example, Bittensor (TAO) saw its price jump 4.5% to $475, pushing its market capitalization beyond $4 billion. Virtual Protocol (VIRTUAL) experienced even more significant gains, rising 15% with daily trading volume soaring 60% to over $600 million. Injective Protocol (INJ) also saw an 8% increase, reaching $15.
Grayscale's initiative to create the "AI Crypto Sector" focuses on the decentralized AI space, reflecting its growing influence in the crypto market. Data from Kaiko demonstrates AI's dominant position compared to other sectors like DeFi, gaming, Layer 2 solutions, and tokenization (see chart below).
Grayscale's AI Crypto Sector includes the top 20 assets in the space, boasting a combined circulating market cap of $20 billion. While this represents less than 1% of the total crypto market, Grayscale anticipates substantial future growth, stating:
“The addressable market of blockchain-based AI applications is potentially very large, and we believe that the Artificial Intelligence Crypto Sector will grow in both absolute terms and relative to the rest of the crypto market.”
The sector includes prominent AI crypto tokens such as Bittensor (TAO), Near, RENDER, and Worldcoin (WLD).
Grayscale's AI Crypto Sector: Three Key Subsectors
Grayscale's press release outlines three main subsectors within its AI Crypto Sector:
- AI Platforms: Foundational networks supporting various AI applications (e.g., Bittensor, Near).
- AI Tools & Resources: Resources for AI development, such as data and computing power (e.g., Grass, Akash).
- AI Apps & Agents: AI applications addressing specific needs, including identity verification or intellectual property management (e.g., Virtuals, Kaito).
The focus on decentralized AI, aiming for bias-free and censorship-resistant systems, is attracting investor interest. Meanwhile, Grayscale continues pursuing other projects such as crypto ETFs, although the US SEC recently delayed decisions on Solana and Litecoin ETFs.
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