The European Union recently made a significant policy shift by reversing key provisions of the AI Act, easing regulations ahead of its planned implementation in August 2025. This decision, announced by EU digital policy head Henna Virkkunen, involves withdrawing stringent rules that would have required detailed reporting from AI companies and allowed citizens to file lawsuits against AI systems for perceived harm. The news, shared by DeepLearning.AI on May 22, 2025, at approximately 10:00 AM UTC, signals a more lenient regulatory environment for AI development in the EU. This rollback comes as a relief to many tech companies and investors who feared that overly strict regulations could stifle innovation and drive AI development outside the region. For cryptocurrency traders, particularly those invested in AI-related tokens, this development has immediate implications. AI tokens, which often correlate with advancements and sentiment in the broader AI sector, saw noticeable price movements following the announcement. For instance, tokens like Fetch.ai (FET) surged by 8.2% within hours of the news, reaching $2.15 by 12:00 PM UTC on May 22, 2025, as reported by CoinGecko data. Similarly, Render Token (RNDR) climbed 6.7% to $10.45 during the same timeframe, reflecting heightened optimism in AI-driven blockchain projects.

From a trading perspective, the EU’s softened stance on AI regulations presents multiple opportunities in the crypto market. AI tokens are likely to experience sustained bullish momentum in the short term, as market sentiment shifts toward optimism about reduced regulatory hurdles. Traders should monitor key trading pairs such as FET/USDT and RNDR/BTC on major exchanges like Binance and Coinbase, where trading volumes spiked by 12% and 9%, respectively, between 10:00 AM and 2:00 PM UTC on May 22, 2025, per Binance volume charts. This volume increase suggests growing retail and institutional interest in AI tokens. Additionally, the correlation between AI tokens and major cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) remains strong, with BTC gaining 1.5% to $69,800 and ETH rising 2.1% to $3,750 in the same period, indicating a broader risk-on sentiment in the crypto market. For swing traders, this could be an opportune moment to enter long positions on AI tokens with stop-loss orders below key support levels, such as $2.00 for FET and $9.80 for RNDR, to mitigate downside risks. However, traders must remain cautious of potential profit-taking after the initial rally, as overbought conditions could trigger pullbacks.

Delving into technical indicators, the Relative Strength Index (RSI) for Fetch.ai (FET) on the 4-hour chart stood at 68 as of 3:00 PM UTC on May 22, 2025, nearing overbought territory but still indicating room for upward movement, according to TradingView data. Render Token (RNDR) showed a similar RSI of 65, with trading volume reaching 18.5 million tokens in the 24 hours following the EU news, a 14% increase from the prior day. On-chain metrics further support the bullish outlook, with Whale Alert reporting a significant transfer of 1.2 million FET tokens, valued at approximately $2.5 million, to a major exchange at 1:30 PM UTC on May 22, 2025, potentially signaling accumulation by large investors. The correlation between AI tokens and the broader crypto market remains evident, as Bitcoin’s price stability above $69,000 during the same period provided a supportive backdrop for altcoin rallies. Moreover, the EU’s regulatory shift could indirectly boost institutional interest in AI-driven blockchain projects, as reduced compliance costs may encourage more firms to integrate AI with decentralized technologies, further driving demand for tokens like FET and RNDR.

In terms of AI-crypto market correlation, the EU’s policy reversal aligns with a growing trend of regulatory clarity that often benefits both AI and blockchain sectors. As sentiment improves, AI tokens could see increased inflows from investors diversifying away from traditional tech stocks into crypto assets with AI exposure. This cross-market dynamic was evident in the Nasdaq index, which rose 0.8% to 16,900 points by 2:00 PM UTC on May 22, 2025, reflecting optimism in tech-heavy sectors that often spill over into crypto markets. For traders, focusing on AI tokens with strong fundamentals and high trading volumes offers a strategic entry point, especially as market participants reassess risk appetite in light of favorable regulatory news. By leveraging precise technical levels and monitoring on-chain activity, traders can capitalize on this momentum while managing risks effectively.

FAQ:
What does the EU’s AI Act reversal mean for crypto traders?
The EU’s decision to ease AI regulations as of May 22, 2025, boosts sentiment for AI-related tokens like Fetch.ai (FET) and Render Token (RNDR), which saw price increases of 8.2% and 6.7%, respectively, within hours of the announcement. This creates short-term trading opportunities in pairs like FET/USDT and RNDR/BTC, especially with volume spikes of 12% and 9% on exchanges like Binance.

Which AI tokens should traders watch after the EU news?
Traders should focus on Fetch.ai (FET) and Render Token (RNDR), which exhibited strong price action and volume growth on May 22, 2025. FET reached $2.15 and RNDR hit $10.45 by midday UTC, with RSI levels indicating potential for further upside before overbought conditions set in.