This week has been quite eventful for the artificial intelligence sector within the cryptocurrency market, marked by significant valuation declines, regulatory shifts, and unexpected successes.
Despite the overall downturn in the AI sector, characterized by several indexes reflecting double-digit losses, Fartcoin—a meme-inspired token—managed to surprise many with its resilience and an increase in price after its listing on Coinbase, which is both fortunate and ironic. Additionally, draiftking (DKING) experienced a notable rise following a significant funding announcement.
Let’s delve deeper into this dramatic week in the intersection of AI and crypto.
AI Sector Loses $1.9 Billion; Altcoins Languish
The artificial intelligence segment within cryptocurrency took a substantial hit this week, seeing a 11.6% drop in total market capitalization—equating to a loss of $1.9 billion. This marks the third-worst performance in the broader cryptocurrency landscape.
This decline coincided with Bitcoin falling to a low of approximately $103,000. By week’s end, Bitcoin rebounded to around $106,500; however, it was evident that altcoins were underperforming during this period while Bitcoin reacted in the opposite manner.
In response, Bitcoin’s market dominance is now at 64%, indicating a flight to safety amongst investors preferring the reliability of blue-chip Bitcoin.
Market sentiment reflected this cautious behavior, as evidenced by the Crypto Fear & Greed Index sliding back to neutral. Investors appear hesitant amidst increasing volatility and the unclear trajectory of altcoins.
Prominent projects connected to artificial intelligence experienced declines, with Render (RNDR) falling 10.2%. Other well-known tokens, including TAO, Internet Computer (ICP), NEAR, and Fetch.ai (FET), suffered losses ranging from 6% to 8%. Despite the buzz and developmental activity surrounding these projects, they struggled to attract buying interest during this latest risk-off phase in the equities market.
Champions of the Week: DKING, VADER, and the Surprising Success of Fartcoin
Amid the downturn, a few AI tokens shone through the negativity, none more unexpectedly than Fartcoin. This humorous memecoin, successfully blending AI themes with viral internet culture, surged by 10.9% following its announcement of a listing on Coinbase. The listing came at a time when many anticipated a market downturn, putting Fartcoin (with a market cap of $65 million) into the limelight while much of the crypto space declined.
Simultaneously, draiftking (DKING) stood out as the top performer of the week, surging 160% after revealing a $300 million partnership deal with a major fund. This collaboration is expected to enhance DKING’s liquidity, provide developmental backing, and increase exposure for its AI-driven betting and prediction platform. VaderAI (VADER) also had a stellar week, gaining 53.2% as renewed excitement about its upcoming project, the Virtuals Protocol, lifted its profile.
These outliers signify that even amidst a sector-wide pullback, investors are willing to place their bets on projects and tokens they genuinely believe in, particularly those with unique or entertaining elements.
🚀 Week in AI: Fartcoin Defies Bleeding AI Sector.
AI sector drops -11.6%! FARTCOIN lists on Coinbase and pumps +10%! DKING rips +160%! U.S. House pushes a 10-year AI freeze! TRNR goes all-in on FET!
Let’s break down AI’s wild week 🤯
1/6— CoinMarketCap (@CoinMarketCap) June 17, 2025
AI Regulation: U.S. House Proposes 10-Year Freeze on State Laws
One of the most significant developments of the week emerged from Washington, where the U.S. House of Representatives passed a comprehensive 10-year ban on state AI laws. If enacted, this legislation will prevent states from implementing their own AI regulations, placing the responsibility on the federal government to oversee all AI matters under a unified set of regulations.
Supporters argue that this move will streamline AI regulation, enhancing compliance for businesses and fostering innovation. However, many—including voices from Silicon Valley—assert that this approach may prioritize ease of compliance over aligning AI innovation with societal values.
The Senate now holds the fate of this bill, and it is expected to ignite substantial debate. Should it be approved, it could become one of the most significant pieces of AI policy ever enacted in the U.S., impacting a variety of sectors, from self-driving cars to algorithm-driven trading.
Encouraging Ecosystem Developments Amidst the Chaos
In spite of volatile price movements and regulatory uncertainties, noteworthy developments within the ecosystem signal some optimism. Blockticity launched a new Avalanche Layer 1 network designed for AI-powered trade verification, already processing $1.2 billion in goods and aiming for scalable, AI-integrated solutions in supply chain logistics.
In another noteworthy development, asset management firm TRNR outlined a plan to secure $500 million, intended for the acquisition and maintenance of Fetch.ai’s FET tokens, which will amount to 10% of FET’s circulating supply upon completion of the deal. This acquisition is part of TRNR’s broader strategy to maintain assets that are increasingly independent of the volatility plaguing traditional financial markets, with other institutional investors expressing similar intents to invest in AI-oriented assets.
This week has highlighted both the challenges and the remarkable potential still present within the AI sector. Whether it’s the rapid movements of memecoins or legislative efforts reshaping the landscape, one thing remains clear: in the realm of AI crypto, surprises abound.