Key facts:
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Nvidia reported 122% revenue growth, but the market reacted negatively.
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FET, TAO and RNDR assets saw their prices decline following Nvidia’s results.
Nvidia announced a 122% increase in revenue, reaching $30 billion, during the second quarter of 2024, as revealed by the technology company in its latest financial report. Despite this record (and Nvidia’s ties to the artificial intelligence industry), cryptocurrencies linked to artificial intelligence (AI) suffered a decline.
Assets such as Artificial Superintelligence Alliance (FET), Bittensor (TAO), Render (RNDR), Injective (INJ), and The Graph (GRT) saw striking declines.
According to data from CoinMarketCap, FET, which is spun out of Fetch.AI, an AI lab building an open, decentralized, and permissionless machine learning network, fell 4%, from $1.45 before Nvidia’s results were released, to $1.23 at the time of this report.
FET token price performance. Source: CoinMarketCap.
TAO, which is the AI Cryptocurrency created by the company behind the Bittensor network, corrected 3.60% from almost USD 320, for USD 303.
TAO price performance. Source: CoinMarketCap.
RNDR, from the leading provider of GPU-based decentralized rendering solutions, Render, gave in 5% from USD 5.93 to USD 5.70.
RNDR token price performance. Source: CoinMarketCap.
INJ, a cryptocurrency developed on a Cosmos-based network for DeFi applications, saw a slight drop of 2.60% from USD 18.7, which brought it to USD 18.4.
INJ price performance. Source: CoinMarketCap.
While GRT, an indexing protocol for querying data from networks like Ethereum, fell 2.33% in one day, from USD 0.153 to USD 0.151approximately.
GRT price performance. Source: CoinMarketCap.
The “sale of the news”
This market behavior, where cryptocurrencies increased in price and then corrected, is known as “selling the news.” This causes asset prices, such as cryptocurrencies, to fall. rise before an important event and then fall after this event occurs.
This happens because investors buy in anticipation of the news, expecting the price to rise when the news is positive. However, once the news is made public, They sell their assets to secure the profits they already anticipated.causing a drop in price.
In the case of Nvidia and the cryptocurrencies AI, before Nvidia revealed its second quarter earnings, the market was full of expectations. People bought cryptocurrencies like FET, TAO, RNDR, INJ and GRT, possibly believing that the news would be good and prices would rise. When Nvidia announced a 122% increase in revenue, beating expectations, you might think this would be positive for these cryptocurrencies. But what happened was the opposite: prices fell.
This happened because the market had already priced in or anticipated this good news into cryptocurrency prices. Investors who bought in anticipation of a rise sold their assets after the news to lock in their profits. With no new buyers to sustain the high price, the values of these cryptocurrencies fell.
In the past, as reported in CriptoNoticias, AI cryptocurrencies experienced a rebound after Nvidia’s earnings. However, this time, the market reacted in the opposite way, reflecting volatility and sensitivity to unmet expectations.
Nvidia has cemented its position as an undisputed leader in the artificial intelligence (AI) hardware market, especially with its GPUs, which are critical for training and inference of AI models, including large-scale ones such as language models.
Nvidia’s relationship with AI is not just that of a hardware supplier; the company has created an ecosystem around its products, such as CUDA, which facilitates the development of AI applicationswhich has been key to its dominance in the sector.
In recent months, AI has gained unprecedented prominence, driven by advances in generative language models and other AI applications that have captured the public imagination and corporate interest.
Nvidia has been a direct beneficiary of this boom, as its products are essential to the operation of these technologies. Nvidia’s financial results presentation, with a 122% increase in revenue, directly reflects this interest and demand for AI capabilities.
This article was created using artificial intelligence and edited by a human on the editorial staff.
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