AI Crypto Crashes Amid US-China Trade War

The ongoing US-China trade dispute has rattled the cryptocurrency sector, with the AI crypto segment taking a severe hit. Following the US’ decision to impose a 10% tariff on Chinese goods, China responded aggressively on February 4 by slapping a 15% counter-tariff on selected US imports.

Now, the situation has worsened, as local reports confirm Beijing is reopening its antitrust investigation into US tech giants, including Google and NVIDIA. In just 24 hours, the AI crypto market cap has fallen over 9%, reflecting investor concerns over the impact on AI-driven blockchain projects.

Trade Tensions Trigger AI Crypto Sell-Off

The AI industry is heavily reliant on NVIDIA’s GPUs, and the new US tariffs directly target Chinese semiconductor components, making GPU production more expensive.

As a result, any slowdown in NVIDIA’s AI hardware output could severely impact AI blockchain projects, which depend on high-performance computing. The prospect of rising costs and regulatory pressure has already discouraged institutional investment in the AI sector.

The consequences are evident in the crypto market, where AI tokens are seeing significant losses.

AI Cryptos See Double-Digit Losses

Over the last seven days, nearly all top AI tokens have been caught in a downtrend:

• NEAR Protocol (-24.3%)
• Internet Computer (-19.2%)
• Bittensor (-24%)
• Render (-21.5%)
• Artificial Superintelligence Alliance (-22.3%)
• The Graph (-20.1%)
• Virtuals Protocol (-29.2%)
• Arweave (-19.9%)
• AIOZ Network (-33.8%)

In the past 24 hours alone, some of the worst-hit AI tokens include:

• NEAR (-2.2%)
• AIOZ (-4.3%)
• AI16Z (-3.2%)

NVIDIA’s Market Struggles

NVIDIA, the world’s leading AI chipmaker, has also felt the effects of the trade war. Over the last 30 days, its share price has dropped by 20.6%, with a YTD decline of 14.21%. In just the last five days, NVIDIA stock has lost 6.14%—a clear sign that trade tensions are weighing heavily on AI-related investments.

Interestingly, despite the broader decline, NVIDIA’s stock saw a slight 1.71% increase in the past 24 hours, an unexpected short-term rebound in an otherwise bearish market.

Will AI Crypto Recover?

Market analysts believe that if US-China trade relations improve, the AI crypto sector could stage a swift recovery. However, continued tariffs and regulatory crackdowns could cause further losses.

Adding to concerns, there are now rumors that China may launch antitrust investigations into Intel and Qualcomm, further escalating tensions in the semiconductor and AI industries.

The Road Ahead for AI Crypto

The AI crypto market is under immense pressure, with tariffs and legal disputes shaking investor confidence. As tensions rise between the two largest global economies, AI tokens and major tech stocks like NVIDIA continue to struggle.

While a potential resolution could trigger a recovery, the current economic standoff suggests that the AI crypto sector may face further volatility in the coming weeks.