South Korean traders are showing a growing interest in digital assets linked to artificial intelligence (AI.) This surge in interest has seen the country’s share of global trading volumes for Nvidia Corp.’s AI-linked tokens rise to 18.7% in May from a mere 0.6% in mid-2023.
What Happened: The AI tokens are typically issued by early-stage projects that aim to use blockchain technology for AI services, reported Bloomberg on Friday.
Despite the unproven utility of this combination, South Koreans are showing a strong affinity for both AI and crypto.
Approximately 10% of the South Korean population is exposed to tokens, with the majority of local trading being in volatile smaller coins, rather than the more established Bitcoin
Notably, Nvidia and Microsoft Corp. are the second and third most popular overseas stocks among domestic investors in South Korea this year, according to Korea Securities Depository figures.
Nvidia’s chips are integral to AI computer processing, while Microsoft is a key supporter of OpenAI and its ChatGPT tool.
The weekly trading volumes for AI tokens have averaged $8 billion since February, a significant increase from the all-time low of $300 million in mid-2023.
However, there are concerns about the sustainability of the interest in AI-linked crypto projects, given the digital-asset sector’s history of booms and busts in coins tied to popular memes or social trends.
Why It Matters: South Korea has been a significant player in the global crypto market for some time now. As of September 2023, South Korean citizens had declared over $98 billion in foreign digital assets, leading to the country being dubbed a “crypto nation.”
The growing interest in AI-linked crypto projects is not surprising, given South Korea’s strong tech industry and the country’s ongoing fascination with cryptocurrencies.
This trend also reflects the global enthusiasm for AI and its potential applications in various sectors, driving investors to explore AI-related opportunities in the crypto space.
Meanwhile, top AI-based cryptocurrency tokens tumbled last week after AI chip giant Nvidia Corp. reported higher-than-expected earnings for the first quarter. Render, the token made gains ahead of the earnings announcement, was trading 3.79% lower. Render is know for the “most significant” ties with the tech giant
Rounak Jain
(2024.06.01) “Fueled By Craze For Nvidia, South Korean Crypto Traders Embrace Risky AI-Linked Tokens”
retrieved from https://www.benzinga.com/markets/cryptocurrency/24/06/39124074/fueled-by-craze-for-nvidia-south-korean-crypto-traders-embrace-risky-ai-linked-tokens
