Cryptocurrency investors who chased the artificial intelligence hype may be left holding the bag as their prices drop and smart money investors sell.
virtual protocol (VIRTUAL), one of the best performing cryptocurrencies in 2024, has fallen below $3 after falling 43% from its highest level this year.
Similarly, ai16z (AI16Z), the third largest Solana (SOL) meme coin, has fallen more than 50% from its January high. Combined, the tokens have lost more than $2 billion in market value.
While this free fall coincides with the continuum crypto crash, a closer look at their metrics on the chain show that smart money investors and profit heads have started to sell their positions.
Ai16z profit heads sell tokens
According to Nansen, the most profitable ai16z trader made more than $39 million. This individual sold basically all of his tokens.
Similarly, the third most profitable buyer made $19 million and sold almost all of his tokens with a huge profit.
While most of the profitable traders still have their ai16z tokens, many have sold most of their profits to take profits.
Another important Nansen data shows that smart money investors have also unloaded their tokens. There are now only 80 ai16z smart money investors with 934 million tokens.
There were 124 of these investors with more than 1.24 billion tokens in December. Nansen defines smart money investors as those who boast a long history in the crypto industry (Bitcoin was first mined in 2009, marked the first decentralized cryptocurrency).
The VIRTUAL price crashes as the big heads sell
The same sale happened for the VIRTUAL token that most of its profit leaders sold their tokens. LVT Capital, the most profitable investor with more than $5.5 million in profits, sold all of its holdings, generating a 4.082% return on investment. Many more VIRTUAL investors also exited, while smart money investors sold.
This investor behavior is common in the crypto and stock market industry. Many retail investors embrace the fear of missing out (FOMO) when a token starts to go parabolic. The initial investors sell, and many are left holding the bag.
A good example is the recent performance of many of the most popular meme coins, such as PNUT, GOAT, Mother Iggy, and Kekius Maximus. As the chart below shows, these tokens came up initially and then collapsed at the end of the hype.
Agent AI tokens have been hyped in recent months as the topic of artificial intelligence has continued to thrive.
Studies show that the AI ​​agent industry is growing and has more room to go soon. One of these reports estimates that the industry was valued at $5.29 billion by 2024 and would grow at a compound annual growth rate of 40% through 2035.
Virtuals Protocol hosts hundreds of projects such as GAME, which has a market capitalization of $212 million, aixbt with a valuation of $411 million, and Luna of $65.2 million.
