tech

Why AI token prices are about to plummet

Nvidia's Blackwell systems could flood the market with cheap AI tokens, driving down costs and reshaping the economics of AI.

Why AI token prices are about to plummet

TL;DR

  • New AI models launching later this year are expected to be more efficient, making AI tokens more abundant and cheaper.
  • Nvidia's Blackwell GPUs are being installed in data centers, acting as supercomputers that enhance AI model training and efficiency.
  • Compared to Nvidia's older Hopper system, Blackwell offers 65 times more token generation per second and 50 times more tokens per megawatt.
  • The cost to generate one million tokens with Blackwell is drastically lower (12 cents) compared to Hopper ($4.20).
  • AI model providers are poised to slash token prices because the new technology makes them significantly cheaper to produce.