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Forbes Advisor has provided this content for educational purposes only and not to help you decide whether or not to invest in cryptocurrency. Should you decide to invest in cryptocurrency or any other investment, you should always seek appropriate financial advice and only invest what you can afford to lose.
It’s hard to imagine two technologies more of the zeitgeist than artificial intelligence (AI) and cryptocurrency, so it’s no surprise that the two fields have converged in the form of AI-cryptocurrencies.
We looked at some of the biggest AI cryptocurrencies by market cap, according to CoinMarketCap*. But first, here’s a primer on what they are.
What are cryptocurrencies?
Cryptocurrencies are a form of digital currency, which is known to be an extremely high-risk investment. They can be spent or traded, but they are not issued by central banks or stored in traditional financial institutions.
Instead, they are decentralized. This means records of balances and transactions are not controlled by banks or payment providers, but are instead kept by people who volunteer to keep track of everything using specialist software.
Volunteers participate because they get the opportunity to earn valuable cryptocurrency without paying for it.
Huge speculation about cryptocurrency values has led to a boom in both the number and value of assets in the space over the last few years – peaking in November 2021 before crashing in spring 2022.
What is AI?
Artificial intelligence (AI) is a field of computer science that enables machines to make decisions based on data, increasingly mimicking human intelligence.
Recent popular examples include AI-generated artwork – where a program interprets user prompts, written in natural language, to create pieces of digital art, and ChatGPT, an app capable of ‘writing’ according to a command given by the user is submitted.
In both cases, the outputs are close enough to what a real person might create that they could be mistaken for human creation, and these applications are becoming more and more sophisticated.
Use cases for AI are effectively limitless, and the technology has found its way into the cryptocurrency space.
What is an AI cryptocurrency?
AI cryptocurrencies are tokens that power AI blockchain platforms like The Graph. Users spend tokens to use the platforms and the benefits of their integrated artificial intelligence.
We looked at some of the leading AI crypto projects by market cap to see how AI is being used within the sector.
Internet Computer (ICP)
Market cap: £4.9 billion
Internet Computer (IC) is the world’s first blockchain capable of running at web speed at unlimited capacity. Built by the DFINITY Foundation, IC aims to reinvent the web by supporting smart contract development at scale and changing the way people can interact with web services.
ICP is currently trading at £10.79.
Injectable (INJ)
Market cap: £2.6 billion
Injective (INJ) is a finance-focused AI crypto project, specifically designed to provide tools for building decentralized finance (‘DeFi’) applications.
Injective offerings include margin trading and derivatives trading on blockchains.
Injective’s native currency INJ is used to validate transactions on the network and cast governance votes on the future direction of the project. INJ is currently trading at £31.98.
The chart (GRT)
Market cap: £1.5 billion
The graph is a protocol for indexing and querying data from blockchains in a similar way to how Google indexes and queries data from websites. Indexing blockchain data can be challenging, but The Graph aims to change that by organizing data into smaller ‘subgraphs’.
The original Ethereum-based cryptocurrency, GRT, was worth £0.16 at the time of writing, down from its February 2021 peak of £2.09.
Give (RNDR)
Market cap: £1.4 billion
Render allows artists to leverage the computing power needed to render computer graphics from crypto miners who are willing to rent out their graphics processing units (GPUs). The project was launched in 2017.
RNDR is the native currency of the Render project, and users spend it to access miners’ GPU power. The system works on a proof of work consensus mechanism.
RNDR is currently trading at £3.96, down from the November 2021 high of around £5.80.
Theta Network (THETA)
Market cap: £1.1 billion
Theta is a blockchain purpose-built for video streaming. It aims to decentralize video streaming by operating a peer-to-peer video delivery network.
The company’s promises are like many metaverse business plans: cut costs, transfer power from companies to the masses, and eliminate middlemen. According to Theta, this vision would give a bigger share of the pie to content creators and make video cheaper for consumers.
THETA is currently trading at £1.10
Oasis Network (ROSE)
Market cap: £757 million
Oasis Network describes itself as the ‘first privacy-enabled blockchain platform for open finance and a responsible data economy’.
In practice, the project is a proof of play blockchain network designed to enable privacy preservation of open finance, in contrast to other blockchains that offer a relative lack of privacy.
ROSE, Oasis Network’s native currency, is currently trading at £0.11, down from its January 2022 high of £0.41.
How can an investor buy AI cryptocurrencies?
Many AI cryptocurrencies can be bought using some crypto exchanges, just like traditional cryptocurrencies like Bitcoin and Ethereum.
To trade, investors will need to open an account – which often involves some identity verification steps, and deposit some fiat currency. They will then be able to navigate to the page of the AI cryptocurrency they want to buy within the exchange, enter the amount they want to buy and execute the trade.
How can an investor store AI cryptocurrencies?
Most exchanges offer a free crypto wallet facility in which to store private and public keys – the credentials needed to spend or trade crypto assets. If an investor chooses, they can store their keys in an offline cold wallet.
Cold wallets are arguably more secure than hot wallets, as hackers can’t target them as easily. However, if an investor loses their login details for their cold wallet, they won’t get the support to regain access to their keys that they should get with a hot wallet.
Are AI cryptocurrencies safe?
Whether AI cryptocurrencies are safe – whether from hackers or from the volatility of the crypto market – depends on how an investor stores them and their attitude towards the risks.
On the latter, no cryptocurrency is safe from market instability, and 2022 was the year crypto’s volatility was exposed.
The UK’s financial watchdog, the Financial Conduct Authority (FCA), has repeatedly issued warnings about investing in cryptocurrencies, saying people should be prepared to lose all the money they invest.
And as far as hackers are concerned, crypto wallets and exchanges are likely to remain a target for criminals – leaving people’s assets at the mercy of the security they and their exchanges implement.
Cold wallets are a hedge against hacks, but they become vulnerable once connected to a web-connected computer.
Meanwhile, exchanges continue to be attacked. Exchanges may beef up their security measures as hackers uncover weaknesses, but it’s a cat-and-mouse game that looks certain to continue.
Cryptocurrency is unregulated in the UK. The UK regulator, the Financial Conduct Authority, has repeatedly warned investors that they risk losing all their money if they buy cryptocurrency, with no possibility of compensation.
Disclaimer for Uncirculars, with a Touch of Personality:
While we love diving into the exciting world of crypto here at Uncirculars, remember that this post, and all our content, is purely for your information and exploration. Think of it as your crypto compass, pointing you in the right direction to do your own research and make informed decisions.
No legal, tax, investment, or financial advice should be inferred from these pixels. We’re not fortune tellers or stockbrokers, just passionate crypto enthusiasts sharing our knowledge.
And just like that rollercoaster ride in your favorite DeFi protocol, past performance isn’t a guarantee of future thrills. The value of crypto assets can be as unpredictable as a moon landing, so buckle up and do your due diligence before taking the plunge.
Ultimately, any crypto adventure you embark on is yours alone. We’re just happy to be your crypto companion, cheering you on from the sidelines (and maybe sharing some snacks along the way). So research, explore, and remember, with a little knowledge and a lot of curiosity, you can navigate the crypto cosmos like a pro!
UnCirculars – Cutting through the noise, delivering unbiased crypto news
