Cryptocurrency
AI tech boom: Is the artificial intelligence market already saturated?
![](https://letizo.com/wp-content/uploads/2023/09/ai-tech-boom-is-the-artificial-intelligence-market-already-saturated_6518261f1262d.jpeg)
From voice assistants to algorithms predicting global market trends, artificial intelligence (AI) is seeing explosive growth. But as with any emerging technology, there comes a point where innovation risks giving way to oversaturation.
The rapid proliferation of AI tools and solutions in recent months has ignited discussions among industry experts and investors alike. Are we witnessing the zenith of AI’s golden age, or are we on the precipice of a market saturated beyond capacity?
The tech landscape has always been dynamic, with innovations often outpacing the market’s ability to adapt.
Historical tech boom-and-busts
The late 1990s saw the dot-com bubble, a period marked by exuberant optimism around internet-based companies. Startups with little more than a web presence achieved staggering valuations, only for many to crash spectacularly when the bubble burst.
In 2017, the world witnessed a surge in initial coin offerings (ICOs), a fundraising method where new cryptocurrency projects sold their underlying tokens to investors.
This period was marked by immense enthusiasm for the potential of blockchain and decentralized technologies. However, excitement often overshadowed the practicality and viability of many projects.
As a result, investments were made in ventures that either had limited real-world applications or, in some cases, no genuine ties to cryptocurrency whatsoever.
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A notable example was during 2017’s “blockchain naming” trend with the company previously known as “Long Island Iced Tea Corp.” The company made soft drinks and had little to do with blockchain. In a bid to capitalize on the blockchain hype, the company rebranded itself as “Long Blockchain Corp.”
Following this rebranding, the company’s stock price soared, with shares rising by an astonishing 275% in just one day. This increase, despite no substantial shift in its business model or operations, highlighted the speculative nature of the market at the time and the lengths to which companies would go to ride the blockchain wave.
The enthusiasm was short-lived, however. According to Bitcoin.com, almost half of the projects offering ICOs in 2017 had failed by February 2018.
AI’s impact goes beyond speculation
While the dot-com and blockchain bubbles were characterized by speculation and, at times, a lack of authentic value, the AI wave is fundamentally different.
Companies like Microsoft and Google are not just dabbling in AI — they’re integrating it into products and services that millions use daily, showcasing real-world applications that are actively improving industries.
Michael Koch, co-founder and CEO of HubKonnect — an AI platform for local store marketing campaigns — told Cointelegraph:
“The AI market feels saturated because people who thought they were technologists and failed at crypto are now moving onto the next hot technology, which is AI — but there are actually real builders and leaders in AI. There needs to be advanced eyes out there for people to really continue to build and take advantage of the evolution of AI.”
Google’s generative AI, Google Bard, attracted over 140 million visitors in May alone, sports teams are receiving real-time analytics, and AI chatbots are becoming more time and cost-efficient.
The modern AI gold rush
The allure of artificial intelligence has led to a surge in AI-driven tools, solutions and startups. According to Precedence Research, the global artificial intelligence market was valued at $454 billion in 2022 and is projected to grow to $538 billion in 2023.
![](https://s3.cointelegraph.com/uploads/2023-09/c536ae2c-0fa6-4c3b-a80f-a1917914f008.png)
Venture capital (VC) has been a significant funding source for the AI sector in 2023. Data from PitchBook indicates that generative AI startups raised over $1.7 billion in Q1 of 2023, with an additional $10.7 billion worth of deals announced that were not yet completed.
Some of the most notable raises included Google-backed Anthropic, which secured $450 million at a reported $5 billion valuation. Builder.AI raised $250 million. Mistral AI managed to raise $113 million without a product or even a proof-of-concept. With the injection of VC thrown at these AI startups like wildfire, one can draw some similarities to the ICO bust. In that situation, there was also a lot of hype without any actual use cases or proof of viability. However, what distinguishes AI is its multitude of use cases and real-life examples of success. Take, for instance, ChatGPT, which rapidly reached 100 million users in just two months, demonstrating AI’s tangible impact.
Yet, with this rapid growth and high valuations, some feel the AI market is overheating. JPMorgan’s chief markets strategist, Marko Kolanovic, believes the AI market is near its saturation point. As reported by Forbes, Kolanovic said the recent market uptick is a result of an “AI-driven bubble” and that the hype around the technology was due to the “popularization of chatbots that often fail in basic questions” rather than “AI-powered earnings growth.”
Leif-Nissen Lundbæk, founder and CEO of generative AI company Xayn, has a contrasting view and believes we are only at the tip of the iceberg. He told Cointelegraph:
“The AI market is not close to becoming saturated. Currently, companies have tried their hand here and there, with some proofs-of-concept materializing. The real large-scale production cases are only getting started, or are yet to come.”
Between saturation and innovation
The sheer volume of companies entering the AI space has raised concerns about a potentially saturated market. Companies worldwide are now utilizing AI as part of their core functionalities. From 10Web’s no-code website builder to RainbowAI’s weather app, and from ICarbonX’s AI providing personalized health analyses to SherpaAI’s virtual personal assistant, the stage has been set for countless others to follow suit.
Lundbæk recognizes that the influx of new companies could lead to the market becoming saturated in some areas but does not see it as a pertinent issue, stating, “The business-to-customer market is perhaps a bit more saturated but has not yet reached full capacity, while the business-to-business market is only in its infancy, even though AI has been around for a while. The vast majority of corporations are only using AI or machine learning for a few visible projects, if at all, that are easier to implement with lower risk, but aren’t applying it yet on a large scale.”
Koch says that the influx of newcomers might give the illusion of an oversaturated AI market, but he views initial saturation as a necessary phase to foster future advancements.
He stated: “AI will never be saturated because we are only on the first off-ramp of the AI super highway. It seems saturated because people from other industries are trying to step into the space, but when it comes down to innovation, there’s already a select group of companies that are so far ahead and that have been in the AI space for decades. To be able to drive innovation forward, saturation will arise at a basic level, but there are elite players and companies that are leading the future of AI.”
Reflecting on AI’s market dynamics
The rapid growth, high valuations and influx of new entrants into the AI realm have sparked debates about market saturation. Historical tech bubbles, such as the dot-com era and the blockchain hype, serve as reminders of the potential repercussions of unchecked growth and speculation.
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However, the depth of AI’s potential is far from fully realized. The technology’s tangible impact speaks to its practical and transformative nature.
It’s evident that the AI market is multifaceted. As with any burgeoning technology, the challenge is to strike a balance between rapid growth and sustainable development.
Cryptocurrency
Top 10 Solana (SOL) Ecosystem Projects by Development Activity
![](https://letizo.com/wp-content/uploads/2024/09/top-10-solana-sol-ecosystem-projects-by-developmentactivity_66dc47b18afea.jpeg)
TL;DR
- Due to recent growth, Solana and its projects have gained popularity.
- Ecosystem meme coins like Dogewifhat (WIF) and Bonk Inu (BONK) have seen significant declines after a substantial surge earlier this year.
The Unsurprising Leader
Solana and numerous projects built on it have brimming in popularity in 2024. Some factors that could have contributed to this might be SOL’s bull run at the end of 2023 and the beginning of 2024, the growing community, and innovations in the ecosystem.
The crypto analytics platform Santiment recently outlined the top 10 Solana-based projects in terms of development activity in the past 30 days.
Somewhat expected, the first spot belongs to Solana itself, which collected a score of 186.33. It is worth noting that the protocol’s native token – SOL – has been experiencing a downfall since the end of July, plunging by approximately 30% and currently trading at around $127 (per Coingecko’s data).
Wormhole holds the second position with a ratio of 90.5. It acts as a bridge connecting various blockchain networks, such as Solana, Ethereum, BNB Smart Chain, and others. It enables users to transfer digital assets and data across these blockchains without a centralized intermediary.
Pyth Network is third, with a score of 68. It operates as a decentralized oracle network where multiple providers contribute to a collective data feed.
JITO and Neon round up the top 5 list. The other Solana-based projects down the line include Drift, Orca, Helium IOT, Helium Mobile, and Metaplex.
The Missing Ones
It is interesting to note that meme coins, which are part of Solana’s ecosystem, did not make the list. Such tokens, including dogwifhat (WIF), Bonk Inu (BONK), and many more, were among the top-trending topics in the crypto space at the start of the year due to their skyrocketing prices.
However, their progress has stalled as of late. WIF – the biggest Solana-based meme coin in terms of market capitalization – currently trades at around $1.52, representing more than a 70% decline from the ATH registered in April.
BONK (the second-largest) is worth approximately $0.00001666 as of the moment, or 60% less than the peak in May.
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Cryptocurrency
These Altcoins Bleed Out as Bitcoin (BTC) Price Fell by $4K in Hours (Weekend Watch)
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Bitcoin’s nosedives continued in the past 24 hours as the asset slumped from an intraday high of $57,000 to under $53,000 within hours.
The altcoins are also in the red, and the total crypto market cap has dumped to $2 trillion for the first time in over a month.
BTC’s Troubles Keep Coming
The primary cryptocurrency lost the coveted $60,000 level last week, and the true downfall followed suit. Aside from a brief attempt to overcome that line on September 3, the bears have been predominantly in control, which culminated yesterday.
Before that, it was rejected a couple of times and marked lower daily highs. A relief rally came on Friday when the US released the job report for August, which showed that there was a slight decline in the unemployment rates.
BTC reacted quickly with a price increase from $55,500 to $57,000. However, that turned out to be a false breakout, and the cryptocurrency headed south immediately after. In a matter of minutes, it plummeted to $54,000 before the bears initiated another leg down that pushed it to a monthly low of $52,700 (on Bitstamp).
Despite recovering to just over $54,000 now, it is still 4% down on the day and more than 8% in the past seven days. Its market cap has plunged to $1.070 trillion, while its dominance over the alts is down to 53.5%.
Alts in Red Yet Again
The bearish scenario repeated once again, and the altcoins are back in red. Ethereum is among the leaders in this adverse trend, having lost over 4% of value. As a result, it now struggles at $2,250. BNB is down by 3%, XRP by 3%, and SOL by 2.5%.
DOGE has dumped the most from the larger-cap alts. The OG meme coin has seen 5% of its value evaporate over the past day and is below $0.1.
Further losses come from the likes of TON, BCH, SHIB, LTC, OKB, XMR, and many others.
The total crypto market cap has declined by another $50 billion and is down to $2 trillion on CG.
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Cryptocurrency
Vitalik Buterin Pledges L2 Tokens to Support Public Goods in the Ethereum Ecosystem
![](https://letizo.com/wp-content/uploads/2024/09/vitalik-buterin-pledges-l2-tokens-to-support-public-goods-inthe-ethereum-ecosystem_66dc47bce1201.jpeg)
Ethereum co-founder Vitalik Buterin has pledged to donate all Layer 2 (L2) tokens he holds to support public goods within the Ethereum ecosystem or broader charitable causes.
This announcement comes a few days after accusations that he had sold millions in Ether (ETH) for personal gain.
Vitalik Buterin Denies Profit Motive
Buterin was quick to respond to the allegations, emphasizing that he has not sold any ETH for personal profit since 2018. Instead, he clarified that any proceeds from his ETH sales have been directed toward projects that contribute to the Ethereum ecosystem or other charitable initiatives.
In a September 5 update, he expanded on his stance, pledging to donate all L2 tokens he holds, including not-yet-liquid assets, to support similar causes.
He wrote, “All proceeds will be donated, again either to support public goods within the Ethereum ecosystem or broader charity (e.g., biomedical R&D). I also do not intend to invest into L2s or other token projects in the foreseeable future.”
He explained that his aim in funding projects is to support initiatives he believes are important, particularly in situations where other parts of the ecosystem may not fully recognize their value.
The Allegations
On August 30, an X user accused him of selling over $2 million worth of ETH shortly after posting a positive update about Ethereum’s future.
Later on, Lookonchain also revealed that Vitalik had transferred 800 ETH, worth around $2 million, to a multi-signature wallet. Shortly after, the wallet swapped 190 ETH for 477,000 USDC.
Further analysis from Lookonchain indicated that on August 9, he had moved an additional 3,000 ETH, valued at over $8 million, to the same multi-sig wallet.
These transfers fueled speculation that the Ethereum co-founder was liquidating his Ether holdings to realize profits.
Buterin had previously disclosed that his entire Ether holdings came from the Ethereum pre-mining period, which allocated 11.9 million ETH (about 10% of the total supply) to early contributors. As one of them, he received 700,000 ETH for his role in the network’s creation.
According to blockchain tracker Arkham Intelligence, his current holdings amount to approximately 240,000 ETH. This is a reduction of around 460,000 ETH from his initial stash.
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