DeepSeek’s Disruption Is the Fuel for Crypto AI’s Future

Dear Subscriber,

As the Weiss Crypto team’s tech expert, I have eagerly followed the rapid growth of the AI industry and AI cryptos in particular.

I celebrated the development of AI agents and broke down what they mean for AI’s future …

I warned you of the hidden threat of AI centralization …

And just last week, I showed you how AI could revitalize two crypto sectors that have lagged this cycle.

Now, I believe the AI industry is at a turning point.

DeepSeek Drags AI to a Precipice

DeepSeek's recent breakthrough in AI efficiency has fundamentally disrupted the market. And it’s created ripple effects throughout the crypto sphere that deserve careful attention.

Let me explain why this matters …

DeepSeek proved that highly capable AI models can be built and operated at a fraction of the traditional cost.

That’s not just impressive from a technical standpoint. It's reshaping how we think about AI infrastructure costs. That means, by extension, how we value AI-related crypto projects will change.

I’m not being hyperbolic. Nor have I been swept away by hype.

The scale of DeepSeek's achievement becomes clear when you look at the numbers: It managed to deliver AI performance comparable to OpenAI's at less than 2% of the cost.

Specifically, it matched a $500 million model with just $5.6 million in development costs while maintaining similar performance metrics.

This dramatic cost reduction represents a fundamental shift in what's possible in AI development.

The old model was simple: More computing power equals more value. But DeepSeek just proved that efficiency is the new king, and this has massive implications for how we value AI crypto projects.

The market's initial response was severe … but predictable.

The AI crypto sector saw its market cap plummet from $17 billion to $6.6 billion as investors scrambled to reassess valuations.

However, the sector is already showing signs of recovery. And its ability to adapt faster than analysts predicted means the AI industry is already making plans to pivot.

It’s clear now that the smart money isn't running away from AI; it's reorganizing its positions within the market.

Crypto AI Leads the Charge

Unsurprisingly, decentralized AI crypto projects are at the forefront of this shift.

Solana-based AI agents have rocketed this week. Their valuation has hit $3.86 billion on Tuesday.

That’s a 13.66% jump in just 24 hours!

And, at the time of writing, AI ranks No. 6 in terms of top performers by market cap over the past week.

But I want to look past price action and valuation for a moment. After all, anyone can tell when a sector is already in rally mode.

Instead, I want to focus on how we can expect this change in valuation to impact AI crypto projects now and in the future.

This way, you can better pinpoint AI projects that have the potential to outperform.

And there are three main developments that have caught my eye.

First is the sharp spike in adoption we are already seeing in distributed computing networks. This is particularly true for projects that use a Mixture of Experts (MoE) architecture — i.e., they internally divide work and delegate it to specialized components that activate only when needed.

It’s not hard to see why.

Decentralized computing networks are already well-positioned to shine under this revamped valuation. They can operate at a fraction of what large, centralized networks need to perform the same tasks.

Because projects like Render (RENDER, “B-”) don’t own or rent physical space for servers or need to maintain their own computers, they can afford to charge much less for their services, which in turn power AI projects.

This has led to the second development: The evolution of marketplace tokens.

Seeing the success of distributed computing networks, AI developers have begun to shift to build platforms where users can directly share and access AI models peer-to-peer.

This shift reduces costs and creates more flexible markets for AI services.

The success of DeepSeek has shown that efficient, accessible AI models can compete with established players, and these marketplace tokens are restructuring to support this new reality.

The third and final development is the shift to hybrid solutions.

These promise to combine local processing with cloud computing to create a “best-of-both-worlds” solution.

In a post-DeepSeek world, where efficient local processing is increasingly viable, such hybrid approaches are well-positioned to capitalize on the advantages of both edge and cloud computing for more established, centralized AI firms.

Projects like Golem and iExec are two examples that have made moves to support a hybrid solution.

Now, here’s what I’m most excited about: None of these developments are occurring in a vacuum.

Each one is fueling the next.

The MoE architecture is making these peer-to-peer marketplaces more efficient, which in turn is making hybrid computing solutions more viable.

Looking ahead, I expect we'll see a new wave of AI crypto projects that emphasize efficient decentralization. I believe they will combine the cost benefits of DeepSeek's breakthrough with the trustless nature of blockchain technology.

The winners won't just be the ones who can run AI models cheaply; they'll be the ones who can do it efficiently while maintaining decentralization.

For investors, this means the metrics for evaluating AI crypto projects need to evolve.

It's no longer just about total processing power or network size; it's about efficiency ratios, adaptation capability and hybrid infrastructure implementation.

Right now, we’re in the early stages of this incredible transformation.

Yes, the overall AI market cap is below its previous highs. But sometimes, you need to break some things before you can rebuild them stronger than before.

And in that break, savvy investors will be able to find opportunities at a discount.

In fact, my colleague Juan Villaverde will be hosting a summit this coming Tuesday. He says his Crypto Timing Model has signaled a unique opportunity ahead in the market. And he wants to let you in on his secret buying method that can help maximize your potential returns.

And with AI poised for even more upside, this could be your moment to get exposure.

So, save your seat for Juan’s briefing. Then, get ready.

The future of crypto AI looks bright.

Best,

Jurica Dujmovic