The post AI Crypto Market Crash as US-China Trade War Escalates appeared first on Coinpedia Fintech News
On Feb 4th, China retaliated aggressively against the US’ move to impose a 10% tariff on Chinese goods, imposing a 15% counter-tariff on selected US goods. The development affected the cryptocurrency sector, especially the AI crypto segment, severely.
Today, the situation has touched a new low, as local reports have revealed the Asian superpower’s plan to reopen its antitrust investigation into US tech giants, including Google and NVIDIA. In the last 24 hours alone, the total market cap of the AI coins segment has declined by over 9%.
US-China Tensions Spark AI Crypto Sell-Off
NVIDIA’s GPU production is heavily reliant on Chinese semiconductor components. Notably, the US’ tariff plan against China also includes a 10% tariff on Chinese semiconductor components. Naturally, the development will make it expensive for NVIDIA to produce GPUs. It will also slow down the company’s AI hardware production.
If this scenario occurs, the biggest victim will be AI projects requiring high-performance computing capabilities. Undoubtedly, this is not favourable news for investors backing AI companies heavily dependent on NVIDIA’s GPUs. Clearly, the unfavourable development may discourage institutional investment in the AI sector.
Unsurprisingly, the total market cap of the AI coins segment has decreased by at least 9% in the last 24 hours.
Major AI Cryptos Hit Hard
In the last seven days, almost all the top ten AI tokens have shown bearish performances. NEAR Protocol has slipped by 24.3%, Internet Computer by 19.2%, Bittensor by 24%, Render by 21.5%, Artificial Superintelligence Alliance by 22.3%, The Graph by 20.1%, Virtuals Protocol by 29.2%, Arweave by 19.9%, and AIOZ Network by 33.8%.
In the last 24 hours, some AI tokens, such as NEAR, AIOZ, and AI16Z, have suffered severe declines. NEAR has dropped by 2.2%, AIOZ by 4.3%, and AI16Z by 3.2%.
NVIDIA Market Performance Overview
The NVIDIA share price has recorded a decline of 20.60% in the last 30 days. Its YTD change stands at -14.21%. In the last five days alone, the market has reported a fall of 6.14%.
Certainly, the US’ tariff action against China and Beijing’s counter-actions, especially the decision to reopen its antitrust investigations into US tech giants, have affected the NVIDIA market severely.
Surprisingly, contrary to the general trend, in the last 24 hours, the market has surged by 1.71%.
What’s Next for AI Crypto?
Experts believe that if the US and China trade crisis eases, the AI crypto sector will recover quickly. However, most experts think that if the economic war between the top two global economies worsens, the AI crypto segment could face more losses.
There are rumours that China will launch investigations into Intel and Qualcomm as well.
In conclusion, the AI crypto market is under pressure due to the US-China trade war. Tariffs and legal actions have shaken investor confidence, causing major declines in AI tokens and tech stocks like NVIDIA. While recovery is possible if tensions ease, prolonged disputes may bring more losses.
Latest News on Cryptocurrency News | Coinpedia.org – Read More