Artificial intelligence-linked crypto tokens have declined over the past 24 hours amid Nvidia’s (NVDA) share price surging over 7% on May 28, but the downturn won’t last forever, says a crypto trader.
“NVDA surging, AI coins quiet now but don’t expect that to last,” trader Matthew Hyland wrote in a May 28 X post.
Nvidia produces computer chips that AI companies are increasingly using to run their AI models. Crypto traders see its stock price as an indicator of how AI tokens could move, with NVDA’s performance a gauge of the market’s AI sentiment.
Nvidia has surged 22% in the past five trading days to close May 28 at a record high of $1,140, the stock has seen a year-to-date growth of nearly 137%, according to Google Finance.
Nvidia’s first-quarter revenue saw an 18% bump from Q4 2023 and surged 262% from the year-ago quarter, reaching $26 billion, beating analyst estimates by around 5.6%.
Meanwhile, several of the largest AI crypto tokens by market capitalization haven’t followed Nvidia and have been down over the past week.
Render (RNDR), Fetch.ai (FET), and SingularityNET (AGIX), are respectively down 8.14%, 11.39%, and 11.19% in the past seven days, according to CoinMarketCap.
Despite AI crypto tokens not following the uptrend, some crypto traders believe this may change during a Nvidia stock price downtrend.
“The moment NVDA starts to sell off it will take all the other mega-cap tech names with it at least for a couple [of] days,” pseudonymous crypto trader Triplexx claimed in a May 28 post. “Then whatever the sentiment in crypto is, it will pull crypto with it no matter what. Be prepared.”
Related: AI token prices soar: Is it all hype, or is there real potential?
On May 25, investment strategist Lyn Alden noted Nvidia is one of the few stocks that has outperformed Bitcoin over the past ten years.
A day earlier, trading resource The Kobeissi Letter said a $10,000 investment in Nvidia in 1999 is “worth $25.3 million” as of May 24.
The broader crypto community believes Nvidia won’t yield the same gains as Bitcoin (BTC) over the next decade though.
“Near zero chance of Nvidia outperforming Bitcoin over the next 10 years,” Swan Bitcoin CEO Cory Klippsten claimed.
Magazine: Torque Drift 2 devs quit after Web3 pivot; game NFTs are not securities: Web3 Gamer
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.