Beginner's Guide to AI Tokens

In recent years, with the rise of artificial intelligence, AI has permeated various industries, and the cryptocurrency sector is no exception. The fusion of artificial intelligence and blockchain has given rise to unique digital assets known as AI crypto tokens. In this article, we will explain what they are, how they work, and list some notable AI cryptocurrencies in the market.

What Are AI Tokens?

AI tokens are cryptocurrencies that support AI-based projects, applications, and services within the blockchain ecosystem.

AI tokens play three key roles:

1. Facilitating convenient transactions: They serve as exchange mediums within AI-driven platforms, allowing users to pay for services, access data, and participate in platform activities.
2. Serving as governance tokens: These tokens grant governance rights to their holders, enabling them to participate in shaping the development of AI projects or platforms.
3. Acting as incentives: They can be used as rewards to incentivize users for contributing to AI protocols or projects, typically for contributions such as providing data or offering computing resources.

How do AI tokens work?

AI crypto tokens typically operate through the following processes:

1. Token Creation: Projects create tokens on blockchain platforms, usually utilizing standards like ERC-20 on Ethereum or BEP-20 on Binance Smart Chain.
2. Smart Contract Creation: Self-executing contracts define how tokens are used in AI-related services.
3. Token Issuance: Projects issue tokens during their token sales or genesis blocks.
4. Token Utilization: Users can acquire tokens through exchanges, staking, or participating in the platform’s ecosystem. Subsequently, they can use these tokens to access services, pay fees, and participate in governance.
5. Integration with AI Platforms: Projects link tokens with platforms offering AI services. Holders can use them to access machine learning models, data analytics, or other AI functionalities.
6. Decentralization: The goal of many AI token projects is decentralization. This distributed governance empowers token holders to have a say in crucial decision-making processes.
7. Incentives: Some projects use tokens to incentivize those contributing resources (such as computing power or data) to the network.

It’s important to note that the specific rules and purposes of each AI token system may vary significantly.

Top Five AI Tokens

The crypto AI sector is rapidly evolving, with many projects emerging to address various challenges in the field. Here are the top five AI tokens by market capitalization:

Injective (INJ): Injective Chain is a Layer-2 decentralized trading and derivatives platform supported by the INJ token. It implements advanced trading tools such as leverage trading, AI-optimized order execution, strategy testing, and predictive analytics. As of writing, INJ is the largest AI token by market capitalization, valued at $3.3 billion.

The Graph (GRT):

The Graph is an indexing protocol for organizing blockchain data, enabling easy querying of on-chain data for AI analytics. GRT is the second-largest AI token by market capitalization, valued at $1.55 billion. As a decentralized network of coordinating nodes (indexers), these nodes stake GRT to gain the right to index and provide application data.

Render (RNDR):

Render Token provides a decentralized GPU cloud computing network for high-demand AI/ML training/rendering tasks. Users stake and lock RNDR to access GPU resources. The project rewards Render Farm providers with RNDR for leasing graphic hardware capacity. RNDR has a market capitalization of $1.5 billion at the time of writing.

Theta Token (THETA):

Theta Token (THETA) supports the decentralized video streaming network Theta and is the fourth-largest AI and big data token, with a market capitalization of $1 billion. It aims to provide higher quality and lower-cost video streaming through innovations in artificial intelligence and machine learning. Users and relay nodes earn THETA by sharing bandwidth resources.

Oasis Network (ROSE):

Oasis Network utilizes a token-incentivized architecture on the blockchain to achieve privacy-preserving AI computations. The ROSE token coordinates node networks through technologies like Intel SGX, differential privacy, and federated learning, providing secure computation. At the time of writing, the market capitalization of the ROSE token is $700 million.

Conclusion

In the overarching trend of the convergence of blockchain and artificial intelligence, AI crypto tokens provide support for innovation in this field. These tokens serve not only as transaction mediums but also play crucial roles in protocol governance and user incentives. The top five AI tokens showcase the diversity and innovation in the market, indicating promising future prospects for the development of this field.

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