The artificial intelligence (AI) sector is experiencing a remarkable resurgence in speculative investments, catalyzing unprecedented highs in related crypto tokens. This resurgence is intimately linked with the soaring performance of major AI stocks, notably Nvidia (NVDA), which has emerged as a beacon of optimism within the stock market’s AI landscape.
AI sector stimulates crypto market surge
The growth witnessed in AI-focused stocks permeates the crypto market, where numerous AI tokens are on the brink of establishing new long-term highs. Recent months have seen overwhelmingly positive sentiment towards AI in the crypto sector, with CoinGecko research identifying AI as the most popular crypto narrative in 2023.
This optimism continues into 2024, which is evident in the significant price movements of major AI-related tokens.
Many of the most significant movers are tokens ranked within the top 100 cryptocurrencies by market capitalization. In just the past week, several AI tokens have surged by more than 25%, with some, like Arkham’s ARKM token, more than doubling in price within the same period.
Notably, The Graph (GRT), currently ranked 42nd by market cap, has experienced an almost 60% gain in a week, briefly surpassing the $0.27 threshold before a minor retraction.
Notable performances of AI tokens
Despite impressive gains, GRT remains nearly 90% down from its all-time high of $2.50 during the 2021 crypto bull run. Another standout performer is Render (RNDR), which entered the crypto market’s top 50 at the close of 2023, following a staggering 1,100% gain throughout the year.
Although RNDR reached an all-time high near $7.50 in November 2021, it swiftly plummeted to $0.40 amidst the subsequent bear market. RNDR is trading at $6.20, marking a potential 15% surge toward establishing a new all-time high.
Key players in traditional finance, such as Nvidia (NVDA) and Super Micro Computer Inc (SMCI), are triggering a ripple effect, propelling the surge in AI tokens. Since the year’s onset, Nvidia shares have surged by over 46%, outpacing its peers and significantly contributing to the S&P 500’s overall growth.
Keith Lerner from Truist Advisory Services underscores this surge, emphasizing Nvidia’s pivotal role in the tech sector’s performance.
The chipmaker’s upcoming earnings report on February 21 garners anticipation, with Wall Street anticipating substantial earnings and revenue growth. Nvidia’s performance is poised to influence traditional finance and the crypto market further, potentially bolstering the ongoing AI optimism.
