NFT Sector Bleeds Deeper as Market Divergence Widens, AI Tokens Shine Through

Crypto markets continued their mixed performance on December 26, with a striking divide between winners and losers. The NFT sector bore the brunt of selling pressure, sliding 7.38% in 24 hours—a concerning signal for digital collectibles traders. Meanwhile, certain niches managed to buck the broader downturn, signaling selective investor demand.

Where Strength Persists

The AI sector demonstrated surprising resilience, creeping up just 0.40% despite macro headwinds. More notably, individual AI tokens showed explosive momentum: Bittensor (TAO), a leading player in decentralized machine learning, posted a modest -1.05% move, while 0G (0G) surged 35.23%, showcasing the sector’s internal divergence.

SocialFi similarly held ground with a 0.69% uptick. Cheelee (CHEEL), a social entertainment token, rocketed 102.80%—a stark reminder that conviction plays still exist in this market.

The Broader Retracement

Beyond the bright spots, DeFi, PayFi, and Layer1 segments all retreated as capital rotated away from traditional blockchain infrastructure. However, selective strength within these sectors hinted that not all infrastructure tokens were created equal—some pockets of resilience emerged despite overall sector weakness.

Market Takeaway

The divergence between NFT’s sharp decline and AI/SocialFi’s tenacity underscores an evolving market narrative: investors are rotating from legacy sectors toward AI and social-first applications. Whether this shift sustains depends on whether upcoming catalysts can sustain momentum in the favored niches.