AI Coins Rally As Grayscale Unveils AI Crypto Sector Amid 4.5x Growth

AI coins are rejoicing today as asset manager Grayscale Investments unveiled its ‘AI crypto sector’ as the industry registers 4.5x growth over the past two years, surging from $4.5 billion to now over $20 billion. The asset manager believes that decentralized AI is equally gaining dominance as centralized players while dominating the crypto mindshare. Top coins like Bittensor (TAO) are already up 4.2% today.

AI Coins Cheer Amid Grayscale’s AI Crypto Sector Push

Soon after Grayscale’s announcement, AI Coins cheered with Bittensor (TAO) price surging 4.5% to $475, and market cap crossing $4 billion. Similarly, Virtual Protocol (VIRTUAL) gained 15% with daily trading volume surging 60% to over $600 million, while the Injective Protocol (INJ) jumped by 8%, moving to $15.

Thanks to Grayscale for unveiling the ‘AI Crypto Sector’, focusing on the decentralized AI space amid its rising dominance and mindshare over other crypto sectors. The below chart from Kaiko clearly shows how AI discussions dominate over DeFi, Gaming, Layer 2s, and tokenization.

Grayscale’s AI Crypto Sector includes the top 20 assets in this space with a combined circulating market cap of $20 billion. Although this is less than 1% of the overall crypto market size, Grayscale believes that:

“The addressable market of blockchain-based AI applications is potentially very large, and we believe that the Artificial Intelligence Crypto Sector will grow in both absolute terms and relative to the rest of the crypto market”.

In addition to top AI crypto tokens like Bittensor (TAO), Near, and RENDER, Grayscale’s list also includes projects like Worldcoin (WLD), which has been gaining prominence recently.

What Will the AI Crypto Sector Offer?

As per the Grayscale press release, the AI Crypto Sector encompasses AI Coins connected to the creation, support, and utilization of AI technologies. It is categorized into three distinct subsectors:

1. AI Platforms: These are foundational networks designed to support the development of diverse AI applications. Examples include Bittensor and Near.
2. AI Tools & Resources: This subsector provides essential resources for AI development, such as data and computational power. Examples include Grass (data scraping) and Akash (compute services).
3. AI Apps & Agents: This category focuses on AI applications and AI agents addressing specific challenges, such as identity verification or intellectual property management. Examples include Virtuals (AI agents) and Kaito (AI-powered sentiment analysis).

Decentralized AI has been on investors’ radar recently with the goal of making it bias-free or censorship-free. Furthermore, Grayscale has also been pursuing other projects like crypto ETFs. However, the US SEC delayed its decision recently on the Solana ETF and Litecoin ETF.