Why AI Crypto Coins Like TAO, ICP, and NEAR Are Crashing – A Deep Dive
Introduction: The AI Crypto Hype Meets Reality
The crypto market loves hot trends, and AI crypto coins were no exception. Tokens like Bittensor (TAO), Internet Computer (ICP), and Near Protocol (NEAR) rode a massive wave of excitement. But now, they are crashing hard. The total market cap for AI coins has dropped 3.4% in the last 24 hours to $12.5 billion. This pullback is killing any quick buy-the-dip chances.
Why is this happening? It’s a mix of broad market fear, weak trading signals, and fading hype. In this post, we’ll break it down simply. We’ll look at price action, technical charts, and what it means for your trades. If you’re holding
The Hard Numbers: How Much Are They Down?
Let’s start with the leaders:
- Bittensor (TAO): Down nearly 3% today, trading at $158. It’s far below key levels.
- Internet Computer (ICP): Crashed 7% in 24 hours and 20% over the week.
- Near Protocol (NEAR): Down 6% today and 17% in seven days, sitting at $1.01.
The whole
Derivatives Data Spells Trouble for TAO
Bittensor’s futures market shows real worry. Open Interest (OI) – the total value of open futures contracts – fell to $106 million. That’s the lowest since September 2024. It was $111 million just yesterday.
What does dropping OI mean? It shows traders lack faith. They close positions instead of adding new ones. Back in November, OI hit $418 million when TAO was at $539. Now, at $158, confidence is gone.
Funding rates add to the gloom. Positive rates mean bulls pay bears, signaling upside bets. Negative rates? Bears rule, expecting more drops. Right now, it’s leaning bearish.
Technical Analysis: Bearish Signals Everywhere
Charts don’t lie. Here’s the TAO breakdown:
- Moving Averages: TAO trades below the 50-day EMA ($232), 100-day EMA ($264), and 200-day EMA ($299). All slope down – pure bear mode.
- MACD: Below the signal line, but red bars are shrinking. Bear pressure might ease soon.
- RSI: At 28, it’s oversold. Downside could pause for a bounce.
- Trend Line: A descending line from $539 caps gains at $218.
A close above the 50-day EMA could target the 100-day. But fail, and $142 (down 11%) is next. RSI needs to cross 50 for real bullish hope.
Broader Market Drag: BTC and ETH Aren’t Helping
Risk-off hits everywhere. Retail is sidelined. Even Ripple (XRP) dips to $1.40. PI Network falls 3% amid token migration selling.
Bitcoin’s year was wild: institutional buys, regs, volatility. But now, correction mode rules.
Why Now? Key Reasons for the Crash
- Cooling Hype: AI buzz peaked. Early pumps led to profit-taking. No new catalysts yet.
- Market Correction: BTC down from highs pulls alts. Dominance rises.
- Liquidity Crunch: Low OI means less new money. Liquidations fuel drops.
- Macro Fears: Global risk-off from stocks, rates, and news keeps crypto shaky.
- Tech Overload: Projects like TAO, ICP, NEAR promise big, but delivery lags hype.
AI integration is real – Bittensor’s decentralized ML, ICP’s smart contracts, NEAR’s speed. But prices reflect sentiment, not fundamentals yet.
Can They Bounce? What to Watch
Short-term hope:
- RSI oversold – minor rebound possible.
- MACD fading bears.
- Break $218 trend line flips script.
But risks loom:
- OI keeps falling? More pain.
- BTC below $70k drags all.
Buy dips? Wait for volume and EMA breaks. Long-term, AI narrative is strong. Hold if you believe in tech.
Final Thoughts: Navigate the Storm Smartly
Track OI, EMAs, and BTC. The next leg up could reward patient holders. What’s your take? Share in comments.
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