AI-based crypto assets, long seen as revolutionary, are facing a major crisis. Their market cap has dropped by 28% in a few weeks.
A Marked Collapse in a Slowing Market
At the beginning of December 2024, AI-based crypto assets reached a market cap of $70.4 billion, but within a month this figure dropped to $50.5 billion. This decline is part of a global market correction, where even Bitcoin, the sector's flagship asset, fell by more than 14%. Additionally, the trading volumes of AI tokens decreased by 11% to $4.73 billion, reflecting decreasing investor interest due to the typical low liquidity during the holiday season and doubts about their real value.
The Hope for a Rebound with the Altcoin Season
Despite the recent drop in AI-based crypto assets, many experts anticipate potential recovery in 2025. This outlook relies on the altcoin season, when Bitcoin's dominance decreases in favor of altcoins. It creates opportunities for alternative assets to attract new investors. Fractal analyses shared by trader Elja on social media suggest that this might start as early as the first quarter of 2025. However, for AI tokens to fully benefit, they must have solid fundamentals and convincing use cases.
The Future of AI-Based Crypto Assets
The future of AI-based crypto assets hinges on their ability to meet investor expectations through developing concrete use cases and establishing strategic partnerships in technology. While the upcoming altcoin season in 2025 may offer interest resurgence, it won't guarantee long-term success. Only strong foundations and tangible innovations will allow these crypto projects to establish themselves sustainably in a competitive market.
Despite current challenges, AI-based crypto assets have potential for recovery, yet they need to demonstrate strong fundamentals and real use cases. The altcoin season in 2025 could provide a revival opportunity, but long-term success requires robust innovations.
