Cryptocurrency is one technology that has brought changes in the way we perceive money. It is a virtual currency that has gone from a niche interest to a trillion-dollar industry in little more than a decade. Now, artificial intelligence applications such as ChatGPT and Bing Chat promise to change the way things work.
But what happens when these two technologies are combined? Yes, artificial intelligence crypto coins are a thing. Several crypto projects are integrating artificial intelligence into their operations more accurate predictions and more efficient trading.
With new projects constantly coming up, it can be hard to keep track of them. Therefore, we have compiled for you a list of the best artificial intelligence crypto projects. Do however remember that cryptocurrencies do not have the same consumer protection guarantees as other financial instruments and hence, sound financial advice should be sought before making any investment.
What is Artificial Intelligence?
Artificial Intelligence or AI is simply a machine’s ability to perform tasks that are commonly associated with human minds. Machines make decisions based on data by trying to mimic human intelligence. Voice assistants such as Siri and Alexa and general chatbots are some examples of AI.
AI has been becoming increasingly sophisticated and programs like ChatGPT can give text responses to prompts that are very close to human creation.
What is Artificial Intelligence Cryptocurrency?
Now, artificial intelligence cryptocurrency or AI crypto are simply digital coins that incorporate AI into their operations. They are more dynamic and responsive as compared to conventional cryptocurrencies because AI crypto coins quickly learn and adjust to market conditions.
AI cryptocurrencies can study market trends, make predictions, and use algorithms to automatically execute trades. Artificial intelligence can also be used to improve network security. Some AI coins, for example, utilize facial recognition technology to prevent fraud.
How Does AI Cryptocurrency Work?
AI in cryptocurrencies are capable of making much more informed trading decisions as they incorporate AI technology in their operations. Like other AI applications, the first step here is the collection of data.
AI cryptocurrencies gather data from several sources such as news articles and social media. They then use machine learning algorithms to analyze the data and predict market trends and behavior.
Next, the AI system uses the analysis to develop a trading plan that determines when the coins are to be bought, sold, and held. Self-executing smart contracts then automatically execute the trades on the blockchain when certain conditions are met. AI cryptocurrencies further use machine learning algorithms to review their performance and make necessary modifications to their strategies.
What are the Benefits of AI Crypto?
Better Decision Making
AI is capable of analyzing huge amounts of data. This is utilized to find market patterns and trends that might not be visible to the human eye. With this, decision-making regarding crypto trading can be infinitely improved. Therefore, better decisions can be made regarding the purchase and sale of cryptocurrencies.
Efficiency
AI automates several parts of crypto trading such as data analysis, market monitoring, and even transaction execution. This not only increases the speed of transactions on the blockchain but also saves the traders’ time.
Better Risk Management
As AI improves crypto data analysis and evaluation, it is also more adept at spotting certain pitfalls and risk patterns. Therefore, traders can make better decisions regarding cryptocurrency investments with the help of AI.
Improved Security
AI can quickly spot possible security breaches and plug them. This will help in reducing hacking and other security problems associated with cryptocurrencies. Further, AI can also be used to improve network security by employing face recognition technology to avoid fraud.
Best Artificial Intelligence Crypto Projects
The Graph(GRT)
The Graph is a decentralized protocol that uses distributed ledger technology(the same technology underlying cryptocurrencies) to gather data. This helps it eliminate intermediaries and more efficiently index blockchain data. The Graph functions as a worldwide application programming interface (API) that efficiently indexes and organizes blockchain data using subgraphs.
GRT is the project’s native token and is used for allocating resources on the network. It is an ERC-20 token with a total supply of 10 billion GRT. About 9 billion GRT are in circulation as of 2023 and the Graph is one of the leading AI crypto projects with a market cap of $1 billion.
Injective(INJ)
Injective is a next-generation blockchain protocol for building DeFi applications. Its cross-chain bridging infrastructure is compatible with Ethereum, Solana, Polygon, and IBC-enabled blockchains. Further, Injective’s smart contract platform is based on CosmWasm which is highly interoperable and has advanced interchain capabilities.
Injective can be used for Proof-of-Stake(PoS) security, protocol governance, DApp value capture, and staking. The protocol is governed by the INJ token. It is a deflationary token as 60% of all fees from all Injective DApps are auctioned weekly via a buy back and burn mechanism.
INJ has a maximum supply of 100 million tokens out of which about 80 million are in circulation. As of 2023, Injective has a market cap of $888 million.
Render Token(RNDR)
Render Token connects artists and studios in need of GPU computer power with miners willing to lend out their GPU capabilities. It is a distributed network that uses a combination of manual and automatic proof-of-work systems to ensure that all art has been successfully rendered before payment is disbursed and art is released.
RNDR is the utility token used by artists on Render Token to pay to get GPU computer power from GPU providers. The payments are released to the providers upon manual verification by the artist of the rendering. The RNDR payment is till then kept in escrow. As of 2023, Render Token has a market cap of nearly $700 million.
SingularityNET(AGIX)
SingularityNET is a platform that enables everybody to create, share, and monetize AI services. It features an AI marketplace where users can browse and purchase a wide range of AI services. Developers too can publish and sell their AI tools on the SingularityNET marketplace. It also has a Request for AI portal(RFAI) where customers can commission a new tool and developers can earn AGIX.
The AGIX token is SingularityNET’s utility token used to pay for tools and services on the network. AGIX has a circulating supply of 1.2 billion tokens and a market cap of $287 million as of 2023.
Oasis Network(ROSE)
Oasis Network is a layer-1 blockchain network created to ensure better privacy and scalability. Its secure architecture, low fees, and high throughput provide a next-generation foundation for Web3 apps such as DeFi, GameFi, and Data DAOs.
The consensus mechanism and smart contract execution have been separated on Oasis Network. Therefore, developers can easily deploy privacy-based apps at a lowered cost. The network’s native token is known as ROSE. It has a maximum supply of 10 billion ROSE tokens out of which 5.7 billion are in circulation. Oasis Network has a market cap of $286 million as of 2023.
Are AI Crypto Coins Safe?
A big question often in the mind of people is- Are AI cryptocurrencies safe? AI coins too at the end of the day are cryptocurrencies and are subject to price volatility like other digital coins. There are certain risks associated with AI crypto such as:
Hacking
AI cryptocurrencies are not immune to hacking or other cyber attacks. Your crypto wallet can be compromised and hackers can steal your coins. Hackers can also manipulate the market if they get access to an AI’s trading system.
Algorithmic Limitations
AI and AI cryptocurrencies though impressive technologies are at the end of the day man-made tools. They have their limitations and cannot completely replace the human element in crypto trading. If the data fed to the AI coin is biased, outdated, or incomplete, it can cause investors huge losses by making incorrect predictions.
Technical Problems
Using AI in the crypto market requires sophisticated code and high-quality and constantly updated data. This can prove to be a barrier for a lot of people due to additional costs. Further, technical issues such as bugs in the code or errors while feeding information can cause losses to investors.
Volatility
As we said before, AI cryptocurrencies are at the end of the day cryptocurrencies. Therefore, just like other crypto coins, they are also prone to extreme price fluctuations perhaps more so than conventional crypto coins due to their use of AI algorithms.
Regulatory Issues
Cryptocurrencies are still not properly regulated in most places. AI is also an emerging technology. AI cryptocurrencies, therefore, throw up a set of new challenges in terms of consumer protection and regulation. Due to their unregulated nature, AI crypto traders would have no legal recourse in the case of scams and frauds.
Conclusion
AI cryptocurrencies are the next step in the evolution of virtual currencies. These cryptocurrencies can study market trends and automate trades by using smart contracts. In addition, they are also looking at utilizing related technologies such as machine learning to improve blockchain efficiency and network security.
However, AI cryptocurrencies come with their own set of regulatory challenges. The complexity of certain ventures can also act as a roadblock in their wider adoption. Therefore, it is important to remember that AI cryptocurrencies are also cryptocurrencies and are subject to similar problems as conventional cryptocurrencies.
Thorough research and professional advice before investment is, hence, non-negotiable even for AI cryptocurrency.