Giant chipmaker Nvidia (NVDA) could help determine later today if the artificial intelligence frenzy is real or just another bubble ready to burst – and take AI-related crypto tokens on a wild ride.
Scheduled for after the U.S. stock market closes Wednesday, this is Nvidia’s first quarterly report since blowing the roof off of Wall Street’s estimates in May and revealing an extremely bullish outlook for revenue tied to AI. This sentiment, coupled with increasingly AI mainstream reach with the likes of OpenAI’s ChatGPT, spilled over onto AI-related cryptocurrencies, sending them soaring.
However, most AI-related tokens that surged after that report quickly lost their gains.
Nonetheless, tokens such as Fetch.ai (FET), The Graph (GRT), Injective (INJ), Render (RNDR) and SingularityNET (AGIX) are still higher year-to-date, suggesting investors remain intrigued by the intersection of crypto and AI. The sector got a modest bump in July after Elon Musk unveiled his ChatGPT competitor.
If the chipmaker can prove that AI is becoming a major moneymaker, that wouldn’t just be a boon for the tech firms that are adopting the technology en-masse, but also for AI-related crypto tokens’ sentiment, at least in the short term.
Today’s earnings could also show how AI may change corporate strategy at crypto miners. While the equipment they use is fine-tuned for crypto and cannot necessarily be shifted over to processing AI, their expertise and physical space in data centers could help them dive into AI.
Miners like Applied Digital (APLD), Iris Energy (IREN), Hut 8 (HUT) and Hive (HIVE) have already started to revitalize their data centers to accommodate AI and other computing services as mining has become less profitable during the prolonged bear market. As investors have also been rewarding the shares of some publicly traded miners for pivoting into AI, depending on how the guidance from Nvidia goes, the prices of these mining stocks could also be affected.
