CMC weekly analysis explores AI market divergence amid Tether’s AI debut

The intersection between Artificial Intelligence and blockchain is changing the dynamics of the cryptocurrency industry, attracting leading players and stakeholders like Tether, the issuer of the world’s largest stablecoin USDT. 

Investors are keeping pace with the AI boom, as projects like Virtuals Protocol (Virtuals), Bittensor (TAO), and Artificial Superintelligence Alliance (FET) see gains alongside Bitcoin (BTC). These AI-driven cryptocurrencies are capturing attention, riding the wave of interest in decentralized AI solutions, while Bitcoin continues its upward trajectory, reflecting a broader market trend.

Tether enters the AI race

The CEO of Tether, Paolo Ardoino, unveiled the company’s new project, Tether(.)ai, at Consensus 2025. According to CoinMarketCap (CMC), this is an open-source, peer-to-peer AI runtime designed to run on “any hardware,” without requiring any API keys. The platform features built-in USDT and Bitcoin payment systems accessed via a developer kit.

In addition to Tether, the AI-blockchain intersection has attracted over 70 crypto entities, including Yuga Labs and Magic Eden, which have pledged support for Thinkagents(.)ai open-source framework. The initiative aims to speed up development in the AI sector to compete against the Big Tech monopoly.

Tokens in the AI sector accelerate recovery

The total AI sector’s market capitalization has made a major comeback in the last 24 hours, surpassing $25 billion. This follows a significant drawdown, where it shed $2.5 billion in market cap, reflecting Bitcoin’s price stagnation between $93,000 and $96,000, as CMC highlighted in the weekly analysis on Tuesday.

Only three of the top ten AI tokens posted losses in the last 24 hours, with FET, TAO and Story (IP) in the lead. Kaito is up more than 40% in a surprise comeback after a two-month-long downtrend. The token hovers at $1.15 at the time of writing on Wednesday, increasing nearly 20% on the day.

A break above the 8-hour 200 Exponential Moving Average (EMA) could push Kaito’s price recovery higher than expected. Beyond this moving average resistance, $1.50 marks the next hurdle, previously tested in March.

The Relative Strength Index (RSI) indicator’s sharp rise into the overbought zone signifies the strong bullish momentum behind Kaito. Still, it calls for caution as overbought conditions often precede trend corrections, reflecting bullish exhaustion and profit-taking. In case of a reversal, tentative support areas lie at $1.00; a resistance-turned-support level, the 100-day EMA at $0.92, and the 50-day EMA at $0.87.

KAITO/USDT 8-hour chart

Bittensor’s price is gaining momentum, up over 1.5% in the last 24 hours to trade at $380. The AI token sits above the 200-day EMA, 100-day EMA, and the 50-day EMA, which augments the bullish outlook. 

The RSI indicator’s rebound above 65 hints at a potential breakout likely to tag $400, accentuated by renewed interest in the AI sector. In the event of a pullback, the 200-day EMA at $378, the 100-day EMA at $329, and the 50-day EMA at $361 could absorb the selling pressure, while providing liquidity to support another recovery attempt.

TAO/USDT daily chart

Artificial Superintelligence Alliance is in the green, up nearly 2% on the day to exchange hands at $0.69. The token sits between two key levels, support provided by the 50-day EMA at $0.62 and resistance at $0.71 due to the 100-day EMA.

Recovery toward $1.00 could gain momentum if bulls breach the immediate $0.71 resistance, and the seller congestion is likely at $0.90 near the 200-day EMA.

FET/USD daily chart

On the other hand, Virtuals Protocol has slowed down the rally after posting more than 200% in gains in the last month before topping out at $1.88. A correction is underway, with VIRTUAL down almost 3% on the day to teeter at $1.44 at the time of writing. 

VIRTUAL/USDT daily chart

The path with the least resistance has shifted downwards, with the RSI indicator falling sharply from its recent oversold peak of 86.55 to 64.55. Should this reversal continue below the midline of 50, VIRTUAL could be forced to seek support at $1.09, coinciding with a confluence of the 100-day and 200-day EMAs. 

In the meantime, there’s a probability that bulls could reclaim $1.50 as the immediate support, a move that may spur bullish momentum and renew the uptrend targeting $2.50.

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