AI Tokens’ Weekly Trading Volumes Drop To A 7-Month Low; Here’s Why
The cryptocurrency market witnessed a remarkable surge in AI (artificial intelligence) tokens in early 2023. The introduction of ChatGPT, an ingenious AI-powered chatbot, towards the end of last year was critical in driving significant gains for various AI-related crypto assets.
However, the demand for AI tokens has declined recently, according to the crypto research platform, Kaiko.
A Weekly Low For AI Tokens
Recent data by Kaiko revealed a significant development regarding AI-related tokens. According to the report, these tokens’ weekly trading volume was the lowest since January 2023.
The research platform analyzed the trading activities of six prominent AI tokens, such as AGIX, FET, INJ, GRT, ROSE, and RNDR. Its analysis revealed a significant drop in their trading volumes.
The report claims the drop reflects a possible shift in investor sentiment and market dynamics for the AI cryptocurrency sector. After reaching peak levels in January 2023, on-chain data shows that investor interest in AI tokens has been waning, reaching a new low this week.
This decline in investor interest is reflected in the price action of these AI-related digital assets. The Graph (GRT), the market’s leading AI token, is a prime example of this trend.
Its price surged massively at the start of 2023, gaining 122% and reaching a yearly high of $0.2323 on February 7. However, this bullish momentum was short-lived, as the GRT token price has since dropped significantly and currently trades at 51% off its January 2023 price.
Such price fluctuations in AI tokens highlight the volatile nature of the cryptocurrency market and the challenges investors and traders face in this ever-changing landscape.
Can OpenAI And ChatGPT Reverse The Trend?
As on-chain data shows, the launch of ChatGPT fueled a surge in interest in AI tokens. However, since the takeoff of Sam Altman’s Worldcoin project and its governance token (WLD), the same level of impact has yet to be observed in the AI and big-data ecosystem.
Sam Altman, the CEO of OpenAI, the AI company behind ChatGPT, officially unveiled his crypto venture on July 24, 2023. This release included the much-anticipated World ID development kit and the WLD token.
According to the project’s white paper, the World ID has innovative features and a unique market approach to revolutionize the crypto space. Despite the expectations surrounding Altman’s project, the market reaction and investor interest level have been lower than the launch of previous AI tokens.
Nevertheless, observers noted that it’s only a matter of time before the Worldcoin project will reshape the AI crypto sector. Meanwhile, CoinGecko data shows that the WLD token increased by over 85% on its launch day, attaining an all-time high of $3.3.
The price spike reflected the investor excitement surrounding the launch of Sam Altman’s Worldcoin project. However, the price of the WLD token dropped sharply a few days after the launch date, falling by more than 31% from its peak value.
Experts believe such fluctuations are not uncommon in the volatile world of cryptocurrencies, as they reflect the market’s dynamic nature and investors’ varying sentiments. Despite widespread enthusiasm for the Worldcoin project, some industry analysts and experts have expressed their reservations about its technology.
For instance, Ethereum CEO, Vitalik Buterin, expressed concerns about the project’s iris-scanning hardware and data collection practices. Besides these concerns, Worldcoin is also facing regulatory scrutiny.
Reports indicate that the Information Commissioner’s Office (ICO) in the United Kingdom has launched an investigation, while the CNIL in France has raised concerns about the legality of the project’s biometric data collection. The WLD token’s value currently stands at $2.35, showing an increase of 8.4% over the previous day.
Nevertheless, the unfolding developments, including regulators’ actions, will undoubtedly play a crucial role in shaping the future of this ambitious crypto venture.
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