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While it hasn't been getting a lot of attention from investors, Cardano (ADA -2.66%) has been on a roll of late. It's now up 35% for the year, and has been keeping pace with market stalwarts such asEthereum (ETH -2.54%), which is up 40% for the year. Moreover, the metrics typically used to value Cardano -- such as Total Value Locked (TVL) -- are also trending up, a sign the blockchain's recent push into decentralized finance (DeFi) might be paying off.

But a potentially really exciting area of growth for Cardano is still being overlooked by investors. Ever so quietly, Cardano appears to be making a push into artificial intelligence (AI), and this could give it a huge competitive advantage against other blockchain networks that have yet to embrace the future of blockchain-based AI. A new move into AI, of course, would support a much higher valuation for Cardano.

The key to Cardano's push into AI is SingularityNET (AGIX -6.65%), which is one of the standout AI crypto tokens of the year. SingularityNET is up nearly 1,000% for the year, and has galvanized investor attention thanks in large part to its track record of groundbreaking AI projects, such as the AI-powered humanoid robot Sophia.

Image source: Getty Images.

SingularityNET is a crypto token, not a coin, meaning that it does not have its own blockchain and needs another blockchain in order to function. SingularityNET originally launched as a token on the Ethereum blockchain. However, in May 2021, it began the process of migrating fully to the Cardano blockchain. Going forward, SingularityNET will be a token that uses the Cardano blockchain for functionality, security, and stability. You can view this as a big win for Cardano -- it managed to lure away a hot AI token from Ethereum based on its superior performance and capabilities.

Now Cardano appears to be ramping up its support for SingularityNET. For example, in February, Cardano announced it will soon launch a new customized staking portal for SingularityNET token holders, making it very easy for it to stake AGIX tokens and earn passive income.

If you're thinking long-term, then Cardano's embrace of AI could be very exciting. Cardano could use SingularityNET as a showcase project in order to attract other AI developers and users. Over time, Cardano might become the "go-to" ecosystem for AI, much as Ethereum became the "go-to" blockchain ecosystem for non-fungible tokens (NFTs) and DeFi.

If Cardano is ever going to become an AI leader, then it will most likely require the continued growth of Hypercycle, a new sidechain connected to the main Cardano blockchain that is specialized for AI. According to SingularityNET, this Hypercycle sidechain is essential to making blockchain-based AI projects cheaper, faster, and more usable than anything Big Tech can produce.

Investors keep asking: "What can you use Cardano for?" If the answer is "artificial intelligence," then that could be big. Until now, the most common complaint about Cardano was that it wasn't really good for anything. It is so academically oriented, and so slow to bring new innovations to market, that nothing big ever seemed to go "live" on it. As a result, investors have never given a huge valuation to Cardano. Its all-time high is just $3.10, which it reached at the very peak of the 2021 crypto boom. And its 52-week high is just $1.24.

Of course, much of this discussion about AI and Cardano is highly speculative, since nobody really knows if blockchain-based AI is going to be a thing.But it's hard to ignore the growing number of headlines about "Cardano's AI project" (i.e. SingularityNET) and not be just a little bit curious. The more you peek under the hood at Cardano, the more interesting things get.If AI ever becomes a central focal point for Cardano, then watch out. This overlooked coin could be approaching its all-time-highs much faster than anyone could have possibly imagined.

Dominic Basulto has positions in Cardano and Ethereum. The Motley Fool has positions in and recommends Cardano and Ethereum. The Motley Fool has a disclosure policy.

Read more from the original source:
Is Artificial Intelligence the Next Frontier for This Crypto? - The Motley Fool