The paradox of AI and crypto. Recently, cryptocurrencies closely or remotely linked to anything to do with artificial intelligence (AI) have seen their valuations soar, following the example of chipmaker Nvidia, whose performance is impressing equity market watchers. However, in the shadow of these brilliant economic results, the experts at Coinbase are highlighting a discrepancy between the price of these AI-stamped crypto-assets and the reality of their current or future usefulness. Their report, entitled "The mirage of AI-linked cryptos", exposes an intersection between crypto and AI that is less obvious than it might seem and reveals that, despite a few gateways, the majority remain far from their envisaged potential.
The Coinbase report highlights the significant competition that decentralised crypto projects face from existing centralised propositions. In a world of significant commercial and regulatory constraints, decentralisation on ethical grounds does not seem sufficient. The reality is that decentralised projects require a great deal of time and development work before they are fully functional, during which time their centralised competitors continue to dominate the market. This dynamic favours faster progress in a centralised context, where consensus is more easily reached. But the future of AI, particularly generative AI, is raising questions among Coinbase's experts. At present, the direction this technology will take remains uncertain, and the idea that crypto or even blockchain could play a role in its development is still speculative.
The practical applications of AI-linked cryptocurrencies remain, for the most part, theoretical. Ideas such as automated payments managed by AI or decentralised physical infrastructure networks (DePINs) exist at the concept stage or in the testing phase, without mass development. Coinbase therefore recommends cautious navigation of this market, stressing the importance of examining the real utility of crypto-based solutions compared to existing alternatives. This critical approach aims to go beyond commercial narratives to understand the fundamental value of these innovations.
The AI craze is reflected in the rapidly rising prices of some tokens associated with the technology. According to CoinGecko, the sector recently recorded a 37% increase, placing it ahead of all other market segments except memecoins. This trend confirms the predominant influence of fads and trends over fundamental analysis and logic in the cryptocurrency space.
AI-labelled cryptocurrencies could continue to gain value from advances in AI in general, despite a not always obvious correlation between the two. With media attention, Nvidia's successes and advances by ChatGPT or Gemini, artificial intelligence remains a hot topic.
