AI Siphons Off Marginal Crypto Buyers, But Institutional Adoption Beckons

T. Rowe Price's Blue Macellari shared concerns about the crypto market's recent weakness on Raoul Pal's The Journeyman podcast. She argued that AI has attracted investors who would have otherwise bought Bitcoin or Solana, drawing them away from cryptocurrency. This 'marginal buyer' is crucial for sustained growth in the market.

Macellari pointed to two reasons for crypto's struggles since October: a slowdown in positive news and the impact of AI on investor sentiment. The market experienced unprecedented momentum last summer, fueled by announcements from institutions and regulatory changes. However, this pace was unsustainable, and the market has been digesting the slowdown.

Despite these challenges, Macellari remains bullish on the bigger picture. She notes that major institutional players are now building something in crypto, with accelerated demand from corporate boards for tokenization and stablecoins. The total addressable market for crypto has expanded to 'infinite' as AI agents begin transacting on-chain.

Macellari sees on-chain finance as the clearest opportunity, covering tokenization, payments, and chains built for institutional use. She highlighted Hyperliquid Strategies Inc (NASDAQ:PURR) as a name generating significant interest from traditional hedge fund managers.