Another day in the crypto market where industry leading coins are not only holding gains, but are continuing to rise, albeit at a steadier rate than January. However it’s the altcoins that investors should keep an eye on right now. Industry leading GameFi and Metaverse coins such as The Sandbox, Immutable and Illuvium registered huge gains in the last week.
Despite huge gains, these categories are not even the top gainers this week. The rise of AI-based tokens has taken the crypto world by storm. According to CoinDesk, the average rise in price of top AI-based crypto is a startling 80% in the past week.
This is due to increased institutional interest in AI technology after the successful launch of chatbot ChatGPT and image generation software Dall E by OpenAI. Both Google and Microsoft have recently made enormous investments in the field. As trends in Big Tech are closely linked to the ebbs and flows of the crypto market, this has led to trickle down gains for many projects incorporating AI into their platform.
The recent surge in AI tokens has led crypto traders to believe that this could be the next growth sector. However, some experts are cautious about the hype surrounding AI tokens and believe that the current trend may not be sustainable in the long run. There are still many challenges and questions surrounding token-based usage and scaling AI software that need to be addressed. Here’s all the days news and updates:
- The Dubai government has prohibited the use of anonymity-enhancing cryptocurrencies like Zcash and Monero under its new regulations for virtual asset companies. The regulations require licensing and authorization for companies looking to operate in Dubai and define anonymity-enhancing crypto as those that prevent the traceability of transactions or ownership. Other jurisdictions, like Japan, have also taken steps to ban privacy-enhancing crypto, and the European Union is considering a similar ban.
- The average gas price of Ethereum increased by nearly 30% in January 2023, due to an increase in user activity. The report also notes that the number of unique active smart contracts increased by 6.74%, while the average number of unique active Ethereum wallets decreased by around 10%. The number of Ethereum transactions per day showed a slight decrease of 0.8% from December to January and the average number of blocks mined each day showed little to no change. The total block size per month increased by 7.08% in January. Analytex suggests that the rise in average gas cost prices and active smart contracts indicates increased interest from current blockchain users and smart contract developers.
- Bitcoin price rises slightly as chairman Powell reiterates deflationary process remark. The Federal Reserve Chair, Jerome Powell, emphasized that the "disinflationary process" has started but it will take some time before the Fed can declare victory against rising price levels. He stated that the recent job report wouldn't have changed the Fed's decision to hike the benchmark rate. Powell's comments were not seen as dovish, but markets were expecting a more hawkish approach following the job report. Nevertheless, his remarks caused an increase in both traditional markets and the price of bitcoin. The Nasdaq and S&P 500 rose, while the 10-year Treasury yield decreased.
- The SEC has announced that it will prioritize monitoring crypto brokers and advisors as part of its efforts to ensure standards of care and risk management in the financial sector. The focus areas were selected by the SEC's Division of Examinations which conducts market analysis to identify potential risks. The SEC plans to investigate whether broker-dealers and investment advisors using emerging technologies, including crypto, are meeting expected standards of care for investors and if they are regularly updating their risk management procedures. The SEC faced calls from Senator Elizabeth Warren to fight crypto fraud. The governing body has already increased its oversight of the crypto sector, bringing a record number of crypto-related enforcement actions in the past year.