Nvidia, a dominant force in the artificial intelligence (AI) sector, has recently experienced a significant market correction. This downturn resulted in the company’s stock losing $430 billion in value, driven by:
- Japanese yen’s carry trade issues
- Delays in AI chip manufacturing due to a design flaw
This correction has raised concerns about the broader implications for AI-related industries, particularly AI-based cryptocurrency projects. We saw how the boom of Nvidia helped AI Crypto Projects at the start of this year. Check Here
Price Action of NVIDIA in 2024
The price action shows a local top formation around June, since the highs have been lower.
Month of August has been bullish so far but the clouds of recession keep hovering above these giants.
Nvidia’s Influence on AI-Based Crypto Projects
Nvidia’s stock performance is closely watched, and its recent correction has cast doubt on the future of AI Crypto Projects . This is particularly relevant for AI-based crypto projects, many of which have emerged by capitalizing on the AI hype. However, the recent market shock surrounding Nvidia has put these projects under scrutiny, especially those lacking real AI technology or decentralized frameworks.
Growing Skepticism in the AI Sector
- Wall Street concerns: The recent market correction has intensified fears of an impending AI bubble.
- Revenue concerns: There is a growing disconnect between massive AI investments and actual revenue generation.
A June report from Goldman Sachs highlighted these issues, suggesting that the AI sector might be approaching its peak. If the bubble bursts, AI-based crypto projects relying on hype rather than genuine AI innovation could face significant challenges.
