The AI-powered crypto sector just took a $2.5 billion nosedive, marking an 8.5% plunge in market value as fresh trade conflicts between the U.S. and China send shockwaves across the tech world. The decline was sparked by Washington slapping a 10% tariff on Chinese imports, pushing Beijing to retaliate with antitrust probes targeting American tech giants like Google and NVIDIA. Rumors are swirling that Intel could be next on China’s radar, raising alarms about a broader tech crackdown that might rattle the global blockchain ecosystem.

AI-driven blockchain projects weren't spared from the fallout. NEAR, Bittensor, and Ai16z all saw sharp drops, with Ai16z leading the pack, crashing by 13%. The sector's total market cap has now slid to $29.2 billion, marking its biggest single-day loss in recent times. Investors are particularly anxious about NVIDIA’s legal troubles, fearing disruptions in AI hardware supply chains—a critical component for blockchain networks dependent on high-performance computing (HPC).

China didn't hold back, slapping a 15% retaliatory tariff on select U.S. products, further fueling market jitters. With tensions escalating, the road ahead for AI-integrated blockchain projects looks increasingly uncertain. Institutional investors are pulling back, bracing for more legal showdowns and tighter regulations that could throttle the sector's growth. If China expands its scrutiny to other U.S. semiconductor leaders like Qualcomm, the market could see even deeper losses.

However, hope isn't lost. Diplomatic efforts could still ease the trade strain, potentially steering the market towards recovery. But for now, volatility is the name of the game. Investors worldwide are keeping a close eye on Washington and Beijing, knowing that any policy shifts could dramatically alter the course of AI-powered crypto assets.

🔍 Will this be a temporary dip or the start of a larger correction? The coming weeks will be crucial as the world watches the next moves in this high-stakes geopolitical chess match.

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