The Artificial Intelligence narrative is gaining traction. Free apps like AI chatbot ChatGPT and image generator Dall-E have reached millions of early adopters. Is it possible that AI will be (one of) the driver(s) of the next bull cycle? Crypto developers have already been trying to monetize this emerging domain. What projects should we pay close attention to? In other words, what are AI coins?
AI is both people's hope and fear. The hope is that it will unburden humanity from a lot of work. Indeed, we could sure use some 'robots' to ease the effects of the demographic collapse in large parts of the Western world. The younger generations are too small to make up for the retired cohort of baby boomers. On the other hand, many fear that AI will rob people of meaningful jobs, having their job being partly replaced by algorithms and robots.
The Pumpamentals and the Fundamentals
Trying to get neither too excited or afraid, as crypto investors we want to stay neutral and look for investment opportunities. Those opportunities can appear on both a short time horizon and a longer time horizon. Trading the shorter timeframe is to benefit from the buzz, the hype. In late 2022 and early 2023, everyone was testing new AI apps like ChatGPT. The narrative 'AI will change the world' got in everybody's mind and AI coins pumped. Even though these coins weren't directly involved in the popular AI apps.
See, that's the fun thing about crypto: the money flows where the collective attention