Known as “AI Meme Coins,” Needham analysts view this “as one of the most unique narratives to develop in crypto in the last several years.”
“Without human decision-making input, an AI bot has scoured crypto markets and started promoting certain coins as attractive buys on social media,” they noted.
“We view this as the first major connection between crypto and AI, and we believe this could have broad implications for exchanges such as Coinbase (NASDAQ:COIN), Robinhood (NASDAQ:HOOD), custody providers, token issuers, and regulators.”
A key project in this movement is an AI bot named Truth Terminal, which was trained on meme-centric platforms like 4chan, Reddit Inc (NYSE:RDDT), and X (formerly Twitter). It has been actively promoting specific meme cryptocurrencies, resulting in the bot’s holdings soaring to more than $3 million.
According to Needham, this is “likely the first ever case of an AI becoming a multi-millionaire.”
These AI bots operate with minimal human intervention, scouring the markets and identifying opportunities based on their unique training. The semi-autonomous Truth Terminal, for example, has been engaging with users on X and even contemplating launching its own cryptocurrency.
“The rise of AI buying crypto assets has resulted in a number of follow-on human investors copy trading the AI leading to a surge in activity in certain meme coins,” analysts said.
Looking ahead, Needham analysts believe that, given the internet-native nature of crypto and the absence of regulated gatekeepers, AI bots could increasingly engage in trading and creating crypto projects for profit.
In the near term, this development is expected to boost trading volumes, positively impacting digital asset platforms like Coinbase and Robinhood.
Longer-term, analysts anticipate that AI bots will play a larger role in the crypto space and potentially in broader financial markets. However, this raises important regulatory questions, such as how investing rules will apply to AI-driven activities.
Source: Cryptocurrency - investing.com
