Changpeng Zhao, head of Binance, expressed his views on the necessity for AI projects to focus on utility rather than launching their own tokens. The impact of macroeconomic factors on the AI token market continues, with experts supporting Zhao's approach.
Changpeng Zhao on AI Project Tokens
Changpeng Zhao stated that not every AI agent needs its own token, as they can accept payments in existing tokens. He opined that a token launch is justified only upon reaching significant scale. 'Focus on utility, not tokens,' he said.
Analysis of Token Valuation Decline
According to CoinMarketCap, the market cap of AI and big data tokens has declined by approximately 22% in the past 30 days, currently at $27.44 billion. Many projects have seen double-digit declines over the last month, with Virtuals Protocol down 42%, Render down 30%, and Near Protocol down 26%. Experts attribute the decline primarily to the broader market downturn exacerbated by U.S. tariffs.
Experts' Opinions on Token Utility
Experts support Zhao's view that AI project tokens should be useful rather than based on hype. Coinbase analyst David Han noted the recent price rally in AI coins was mainly driven by hype rather than actual utility. On-chain sleuth ZachXBT claimed that 99% of AI cryptos are scams and that the tokens 'try to larp as much as possible to appear legit to unsuspecting users.'
The decline in the AI token market is driven by macroeconomic factors and the lack of utility in most projects. Experts emphasize the need for a more rational approach in AI project development with a focus on real utility.
