
From crypto to AI: Why are believers turning collectively?
Source: Wall Street Journal Author: Vicky Ge Huang Compiled by Chopper Original title: Why are cryptocurrency believers “throwing coins into AI”? Summary: Individual investors are withdrawing from the cryptocurrency market and switching to AI stocks. Daniel Koss, a 30-year-old investor, cleared Bitcoin and invested all of them on the AI circuit; Ryan Ho, the founder of the social networking platform, also replaced his seven-digit Bitcoin holdings with chip stocks, believing that the structure of the crypto market is weakening and the AI application scenarios are more realistic. Another trader, Minh Le, cashed out some of his crypto assets to buy Ferraris and anime collectibles. Although he recently re-entered the market, his strategy is conservative. Bitcoin fell from a high of $126,000 to around $60,000, decoupling from the trend of US stocks, while AI stock derivatives launched on platforms such as Hyperliquid also boosted capital migration. Bloomberg analysts say the crypto market is undergoing a deep clean-up, and investors believe that the era of Bitcoin's high-multiple growth is over. Daniel Koss has bought Bitcoin in a big way, and he is convinced that cryptocurrency will reshape the financial industry. But after the advent of the AI boom, he changed his investment direction. The 30-year-old investor believes that rapidly developing artificial intelligence technology has the potential to disrupt many industries, so he entered the market decisively. In August of last year, he cleared his six-digit Bitcoin holdings, and now all of his money is invested in the artificial intelligence circuit. “It felt like primitive humans discovered Tinder.” Koss, who is in Zug, Switzerland, said. Koss's position adjustment choice reflects the major capital migration that has taken the entire market by storm over the past year: individual investors and hedge funds have successively sold Bitcoin and various tokens to chase AI stocks. This asset rotation also explains Bitcoin's price dilemma: since it hit an all-time high of over $126,000 in October last year, Bitcoin has continued to be under pressure and has been hovering around $60,000 for a long time. At the time, the Trump administration threatened to impose new tariffs on China, triggering investors to sell high-risk assets. At the same time, chip makers and other AI concept stocks have broken out of the boom that only existed in the crypto market in the past. Bloomberg Industry Research Advanced Commodity Strategy Mike McGlone said, “The crypto market is undergoing a round of deep clean-up, and this is just the beginning.” The US stock market continued to hit new highs this year, yet Bitcoin continued to weaken. Koss has no plans to re-trade Bitcoin anytime soon. In his view, crypto assets have matured, and the era of exponential skyrocketing surges is over. He believes that Bitcoin will never increase tenfold in a year. “Bitcoin is already so large that even doubling it would be extremely profitable.” Even staunch crypto believers are reducing their crypto holdings and turning to volatile AI stocks. Ryan Ho, founder of the social trading platform Legend, revealed that when the price of Bitcoin was close to $120,000, he held a seven-digit Bitcoin position. At the time, he was convinced that Bitcoin “will never fall below $100,000 again.” However, the market backfired. In December of last year, he swapped a large number of bitcoins and altcoin holdings to buy AI-related stocks such as chip companies, including Intel. Currently, he still holds hundreds of thousands of dollars in Bitcoin. Ryan Ho, a 25-year-old entrepreneur, said that the core reason for the reduction in crypto assets was the structural weakening of the crypto market. In his view, after the sharp decline in October, the crypto market no longer has the characteristics of a health-risk asset: demand for buying has dried up, and institutional capital continues to flow to the AI sector. The crypto market then decoupled from the trend of US stocks. US stocks continued to rise, and the crypto market stagnated. Ryan Ho believes that ordinary investors are more likely to be optimistic about the growth prospects of AI. Artificial intelligence has a large number of real implementation scenarios such as ChatGPT and AI-assisted programming. Another driving force behind the shift of capital from crypto to AI is the launch of AI stock derivatives on mainstream crypto trading platforms such as Hyperliquid. “A large number of crypto traders have started trading AI stocks in the past few months, and the core reason is that related trading channels have been opened up.” Ryan Ho said. There are also some crypto traders who chose to settle the bag and end the previous round of sharp increases in Bitcoin and mainstream tokens. Trader and digital artist Minh Le recently monetized some of his crypto assets to buy a Ferrari, while also allocating a large amount of profit to a Japanese anime collection, including “One Piece” and Pokémon collectible cards. Minh LeMinh Le relies on...



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