Top AI-focused cryptos like TAO, NEAR, ICP, and RENDER faced losses surpassing 20% as investor demand in the sector fell amid concerns surrounding Big Tech’s growing bets on AI infrastructure.
Summary
- The combined market cap of all AI cryptocurrencies nosedived by over 40% on Friday.
- Concerns over massive AI-related spending by Big Tech companies have spooked investors.
According to data from CoinGecko, Bittensor (TAO), the largest AI-focused cryptocurrency with a market cap of $1.58 billion, fell 23% over the past 7 days, exchanging hands at $164 at press time. Near Protocol (NEAR) fell 25.4% while Internet Computer (ICP) and Render (RENDER) posted similar losses over the weekly period.
The entire AI crypto market has shown no signs of recovery or stabilization, recording over 42% losses in the past 24 hours alone as its total valuation fell to roughly $12 billion.
TAO and other top AI coins fell as investors remain concerned after reports from Big Tech giants like Alphabet and Amazon revealed a massive jump in AI investments for 2026, which could balloon up to $500 billion, according to recent estimates.
Investors fear that the astronomical costs of AI development will erode margins before monetization is realized, especially since recent earnings reports from these companies highlighted a significant gap between infrastructure spending and actual profit generation.
As these concerns grew louder across the broader financial markets, it triggered a sell-off in AI-linked software stocks such as Microsoft and AI chipmaking giants like AMD and Nvidia. Notably, Microsoft shares stood over 8% lower in the past five days, while chip-making giants AMD and Nvidia shares were down 18.5% and 10%, respectively, over the same period.
These chipmaking and software firms are the backbone of the hardware and processing power that is used to run the decentralized networks of most of the projects in the AI crypto space.
Notably, Bittensor relies on high-performance GPU clusters to facilitate its competitive machine learning model training, while Near Protocol is a highly scalable blockchain designed to support the intensive data demands of AI applications. Meanwhile, Internet Computer provides the sovereign cloud infrastructure required to host autonomous AI agents, and Render offers the decentralized computing power essential for complex graphical and AI rendering tasks.
Aside from the mounting anxiety over capital expenditures, AI tokens have also been weighed down by massive liquidations across the crypto market that came from Bitcoin’s dramatic plunge below multiple key support levels and a confluence of macroeconomic and geopolitical concerns that have driven risk-on sentiment away from speculative assets.
As previously reported by crypto.news, Bitcoin (BTC) price briefly fell by over 18% on Thursday as it touched nearly $60K levels, which triggered nearly $2.6 billion in liquidations across leveraged markets as market fear reached levels last seen during the collapse of the Terra blockchain nearly four years ago.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
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