- AI market cap recovery could mirror DeFi’s 2020-2021 rally, signaling major upside.
- Breaking $10B resistance is crucial for AI; parabolic growth may follow DeFi’s path.
- AI tokens, like AGIX, show potential as the sector gains momentum post-August 2024.
The artificial intelligence (AI) sector has witnessed a turbulent journey, with its market cap declining from $15 billion to $4.5 billion. Yet, historical patterns suggest this downturn could be a precursor to a massive recovery.
According to a Milk Road analyst, the AI market cap trajectory shows striking similarities to DeFi’s market boom between 2020 and 2021. This comparison raises questions about whether AI agents could replicate DeFi’s meteoric rise.
Comparing Growth Trajectories: AI vs. DeFi
In 2020, DeFi experienced a slow start before exploding to $12 billion during the “DeFi Summer.” After a temporary pullback to $8 billion, DeFi rallied aggressively, peaking at over $60 billion by early 2021. A similar pattern has emerged in AI markets. From early 2024 to mid-2024, AI-related tokens remained relatively stable.
However, from August onward, the sector began gaining momentum. By January 2025, AI agents appeared on the brink of a major rally. This pattern mirrors DeFi’s early trajectory, raising hopes for sustained AI growth.
Key Levels to Watch in the AI Market
Significant resistance levels could determine the path forward. The $10 billion mark represents a key psychological barrier, where early struggles often occur. Consolidation zones between $30 billion and $40 billion could be the next battleground. If AI follows DeFi’s trend, a parabolic phase might push the sector beyond $60 billion.
Trading Implications: Potential Opportunities Ahead
As of press time, Ethereum, a core DeFi asset, traded at $2,094.31 with $11 billion in 24-hour trading volume. Meanwhile, AI token SingularityNET (AGIX) traded at $0.2323. This market divergence suggests a possible buying opportunity for AI believers. If history repeats, AI could mirror DeFi’s explosive recovery and offer lucrative returns.
