Fading Artificial Intelligence hype bears Microsoft and crypto tokens extensive losses
- Microsoft is losing money on its generative AI product despite partnering with ChatGPT creator Open AI, per Wall Street Journal.
- Crypto tokens based on Artificial Intelligence projects are also recording declines ranging from 9% to 13% in a week.
- The native token of popular blockchain analytics firm Arkham Intelligence is leading the losses, falling by 20% in the last seven days.
Artificial Intelligence (AI) hype originating from ChatGPT peaked in Q2 this year, which impelled multiple tech companies to enter the AI race, including the likes of Microsoft. Crypto tokens based on AI projects also enjoyed immense benefits initially, but at the moment, this bullishness is slowly vanishing.
Microsoft loses money on AI product
Microsoft, one of the biggest tech companies in the world, was quick to jump into launching an AI product, even partnering with the creator of ChatGPT, OpenAI. However, according to the Wall Street Journal, Microsoft has been consistently losing money on one of its first generative AI products.
Citing sources, WSJ reported that AI products have been costing the company between $20 and $80 a month per user. The profitability of AI products could see an increase if the computing costs decline, but until that happens, Microsoft is set to charge a much higher price for its next AI software update.
The impact of the diminishing AI hype is not only visible on TradFi companies but cryptocurrencies as well, with top tokens declining significantly this past week.
AI Crypto tokens take a hit
Crypto tokens native to Artificial Intelligence projects have had a relatively bearish week. Over the past seven days, most of the top AI altcoin observed a drawdown even as most of the crypto market had a calmer week.
The top losers in this sector include the likes of The Graph (GRT), Ocean Protocol (OCEAN), SingularityNET (AGIX) and more. The drawdown of these cryptocurrencies ranged from GRT falling by 9.93%, OCEAN losing 13.32% of its market value, and AGIX declining by 9.6% from its opening price last week.
AI Crypto tokens in the past week
Amidst these assets, ARKM emerged as the altcoin that had the most disappointing run though. The native token of popular blockchain analysis firm Arkham Intelligence fell by more than 20% in the last seven days. The altcoin was launched at $0.744 in July this year but is yet to make an actual profit for its investors, trading at $0.348.
ARKM/USD 1-day chart
The fading hype of Artificial Intelligence might make things more difficult for investors of assets pertaining to this sector.
Author
Aaryamann Shrivastava
FXStreet
Aaryamann Shrivastava is a Cryptocurrency journalist and market analyst with over 1,000 articles under his name. Graduated with an Honours in Journalism, he has been part of the crypto industry for more than a year now.
