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Binance Reveals AI Tokens Outperform BTC and ETH With up to 650% Yearly Gains

Binance Research’s latest findings indicate that in 2023, artificial intelligence (AI) coins achieved substantially greater returns compared to the well-established cryptocurrencies, Bitcoin and Ethereum. Simultaneously, funding for projects related to AI in the Web3 space has witnessed a remarkable surge.

As outlined in a report from Binance’s research division, AI tokens benefited from an increased interest in the AI sector. Over both the past quarter and the entire preceding year, AI tokens experienced a notable upswing, surpassing the broader market’s performance.

During the last three months, AI tokens ranked as the second-best-performing category.

Furthermore, in 2023, they outperformed the world’s two largest cryptocurrencies. By the end of the year, Bitcoin (BTC) recorded a 150% gain, while Ethereum (ETH) saw a 44% increase.

The report also highlights that,

“The top five AI coins, based on market capitalization, substantially outpaced BTC and ETH, resulting in gains ranging from 200% to 650% in 2023.”

Nonetheless, it’s important to note that BTC and ETH possess significantly larger market capitalizations compared to AI tokens. Consequently, their relatively smaller percentage gains in 2023 should be expected.

AI Reshaping Crypto Industry

The significant upsurge in AI token prices and the noticeable increase in Google search trends are clear indicators of growing interest in AI over the recent months. Various factors have contributed to this surge, including the prevalence of AI chatbots, particularly exemplified by ChatGPT, the introduction of novel AI tools, and extensive media coverage.

As a result, AI is beginning to reshape the cryptocurrency landscape, extending beyond the surge in AI token values. This transformation is manifesting in practical applications as well, and it has rapidly become a prominent narrative in the industry.

This trend has naturally spurred the development of cryptocurrency applications deeply intertwined with AI, which, in turn, is poised to drive continuous innovation within the sector.

Already, several use cases have emerged as a result of the convergence of AI and cryptocurrency. These include AI-powered data analytics platforms, engaging consumer-facing applications, decentralized physical infrastructure networks (DePIN), and the intriguing concept of Zero-Knowledge Machine Learning (ZKML).

Binance Research has conclusively determined that AI is undeniably gaining substantial traction in the cryptocurrency sphere. As the adoption of AI applications continues to surge rapidly, it is concurrently attracting sustained interest from both investors and the retail market.

AI Tokens for Web3 Projects Raised Nearly $300M in 2023

In the past year, funding for AI-related Web3 projects experienced a substantial surge, reaching a total of $298 million.

According to the report,

“This amount surpasses the combined funding raised for AI projects from 2016 to 2022, which amounted to $148.5 million.”

The report characterizes the level of investor interest in the AI sector as “robust” and resilient when compared to the broader market. While there was a general decrease in funding across various sectors in 2023, both within AI and outside of it, AI funding for startups in the United States saw a remarkable increase of 230%.

Moreover, the report highlights that funding for AI projects within the Web3 industry exhibited “explosive growth.” This is evident from the $298 million raised in 2023, which represents twice the total funding accumulated over the preceding seven years.

In comparison to other sectors within Web3, AI projects secured the 7th position in terms of funding, surpassing non-fungible tokens (NFTs) and decentralized autonomous organizations (DAOs). Infrastructure projects held the top spot by a considerable margin.

The report emphasizes that widespread adoption of AI has not yet been achieved, and AI-powered crypto projects, in particular, are still in early stages of development or designed for niche user bases.

However, the report remains optimistic, stating that “the increase in tangible use cases is an encouraging trend that bodes well for long-term growth.”

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I want to save money. Will cryptocurrency work?

Cryptocurrency is essentially virtual money that operates in a decentralized manner, not through a bank but directly on multiple independent computers.

Every cryptocurrency has two main components: the units of digital exchange called “coins” and the network within which the exchange takes place. These units can be transferred between wallets and exchanged on exchanges. The networks in which these coins exist are called blockchains, which translates to “chains of blocks.”

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