The positive first-quarter earnings report from Nvidia, which was primarily a result of its AI data center business, did not have the immediate impact on AI crypto tokens that traders had anticipated. Despite the company's revenue jumping 18% from Q4 2023 and surging 262% from a year ago, beating analyst estimates, AI-related crypto tokens such as Render (RNDR), The Graph (GRT), Fetch.ai (FET), and SingularityNet (AGIX) experienced declines in their prices.
The earnings report, released after the New York Stock Exchange (NYSE) market closed on May 22, led to a 6.06% spike in Nvidia's stock price, reaching $1,007 in after-hours trading. However, AI token traders were left disappointed, as the positive results did not translate into a similar increase in AI token prices.
Render, an Ethereum-powered platform enabling decentralized graphics processing unit rendering, saw its price plummet by 12% within five hours of the earnings report, dropping to $10.38. Crypto research firm Santiment noted that a whale wallet transferred around $52.1 million worth of RNDR tokens to an unknown wallet on May 22, suggesting that large holders may have been anticipating a "sell the news" event.
Other AI-related tokens also experienced declines, with The Graph dipping by approximately 4.77%, Fetch.ai by 6.42%, and SingularityNet by 6.25%. These price movements were unexpected, given the historical correlation between Nvidia's stock performance and AI crypto tokens.
Despite the initial disappointment, traders remain optimistic that Nvidia's strong earnings will eventually have a positive impact on the wider crypto market. Pseudonymous crypto trader D0C Crypto pointed out that Render didn't experience a price spike until two days after Nvidia's last earnings report, suggesting that history could repeat itself and RNDR could rise above $15 within the next 48 hours.
Nvidia's success in AI data centers is expected to continue, with the company announcing plans to build on its Q1 success and expand its AI ambitions, including AI chip production and collaborations with tech giants. The company's market cap has grown significantly, making it the third-largest public company globally, and its CEO, Jensen Huang, believes Nvidia is poised for its next wave of growth.
While the immediate impact of Nvidia's earnings report on AI crypto tokens was not as expected, traders are confident that the company's success will eventually flow into the wider crypto market and have a positive impact. Due to the growing adoption of AI technology and the rising demand for AI-related digital assets, other AI tokens may soon start to rise as the news of Nvidia's earnings makes its way into the market.
