Coinbase Analyst Claims AI Tokens Get More Hype Than Deserved

A cryptocurrency analyst working for Coinbase recently noted that AI-based cryptocurrencies are currently overhyped. It is worth noting that at present, AI token section is the crypto group that has generated the biggest returns. However, the analysts expect an upcoming buffer in the prices of AI tokens. Speaking on the matter, researcher David Han shared his analysis.

He opines that various industries and sectors are currently working on integrating AI-solutions in their business models. However, he has retained that AI tokens hype may have a short or medium-term consolidation. The rise of generative AI within the crypto industry started during the past few years.

Han noticed that AI technologies are undergoing rapid changes and therefore it could also lead to considerable variations in terms of implementation. On this account, he claimed that investors should take a cautious approach about adding AI-based tokens in their long-term portfolio in terms of sustainability. He retained that AI crypto projects have fundamental differences at the core.

Can AI Tokens Expose Investors to Long-term Trading Risks?

Coinbase analyst talked about the fundamental differences between cryptocurrencies and AI projects. He retained that cryptocurrencies are focused on ensuring decentralization. In contrast, AI relies on various centralized factors and data resources.

At the same time, he noted that a considerable number of AI cryptocurrencies have failed from amassing investment interest.

These projects are now running with semi-indexed capital allocations. The research report makes note of two opportunities within the crypto-AI ecosystems. The first is changing data storage on blockchain networks to enable human-readable formats and analytics. The second one is bringing decentralization to the otherwise centralized AI program framework.

At the same time, Han claimed that technologists and users may invest in decentralized AI projects within the cryptocurrency section. However, there are also no guarantees for such a probability. He projected that it is possible that the future of AI industry is still undergoing major changes such as regulatory implications and mass adoption. On the other side, various AI tokens continue to print noteworthy returns.

AI Projects to Generate Good Returns for Investors in Long Run

The recent success of Nvidia and Microsoft in the stock market as biggest gainers has also made a visible impact on cryptocurrencies. Coinbase linked the profits with broader crypto industry and media effect emanating from AI-based headlines.

The exchange has retained the possibility that AI narrative will grow stronger conditioned with meaningful adoption and offering more value than decentralized AI features.

Speaking on the matter, Vitalik Buterin a prominent figure in the blockchain sector highlighted the utility of AI in debugging and verification of code. Crypto.com statistics have projected a total market cap of $51.18 billion for the sub-section as of 8th March. The AI tokens are backing decentralized trading platforms, AI-powered trading algorithms, and AI-backed DAOs.

AI is currently the fastest-growing and trending technology. The role of blockchain is to monetize any technology or digital utility. The fact that every major corporation has introduced or revamped a native AI program has also reinforced the interest among investors.

Another important factor associated with AI is about its clash with the working force. The Hollywood writer association recently went on a strike to record the protest against AI-written material.

Future of AI

There is an increasing outcry about AI replacing people and taking away jobs. However, statistics from the World Economic Forum issued in 2020 noted that while AI could remove 85 million jobs it will also create 95 million new vacancies in fields such as data mining, digital marketing, machine learning, and cybersecurity, etc. The upcoming concerns around AI as an investment product and emerging technology are not unfounded.

However, spokespersons from both sides have currently waged a war against each other. Practically speaking, companies that have an incentive to reduce costs with AI are bound to implement it.

Meanwhile, the existing workforce would be up for a rude awakening by calling for an AI-exodus. A negotiation approach that warrants interest and gives a voice to either side may warrant better outcomes.

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