Don't believe the noise.
We are at the onset of an AI revolution.
Many want to question whether we are in a bubble. Others state there is too much hype. Regardless of whether these are true or not, the reality is we are moving ahead quickly.
The most recent period we saw which could be paralleled, with regards to markets, was the Internet. There certainly was a bubble, now called the "Dotcom Bubble". We also saw a lot of hype surrounding the technology.
In spite of both being present, the development of the Internet was uninterrupted. Today, 25 years later, we are orders of magnitude ahead of where we were.
The same is going to happen to AI. Even if there is a bubble, the technological progress will keep advancing things. One majorchange is we will see the jump in 5-7 years as opposed to 25.
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Crypto Is At The Center Of The AI Revolution
In my previous article, we discussed how the future of AI is machine-to-machine communication.
The true burst in value to AI is when it is "networked". A standalone AI agent might have some value. However, the entire scenario changes when we are dealing with connected agents.
This mirrors exactly what happened with computers in the 1970s versus the Internet in the 1990s-2000s.
Of course, there is the fear of AI taking over. Here is where cryptocurrency, once again, finds itself at the center of it all.
Many question what happens when we have an "all-knowing" species. The fear associated with AI is that it will have the ability to go rogue. It can do whatever it wants without the feeble humans being able to stop it.
While this has a nice Hollywood flair, it does run into some challenges.
AI is trained on what is available in terms of data. Many things that are tied to cryptocurrency are not available online. For example, most people do not post their keys.
Here is where we see the limited factors starting to enter.
Cryptography uses a key system to operate. For a user to gain access, it requires the key. Naturally, when looking at the keys, it is very difficult to hack. Some theorize quantum computing will take out present encryption. Fortunately many are working on quantum-proof encryption, ironically based upon quantum, to solve the problem.
Moving past that, we can see how the key system is a limiting factor. Hence, agents and other developments that are ultimately tied to crypto "wallets" would be retrained. The ability to take total control is reduced since that which is keyed is not accessible to other agents.
Like A Fish In Water
Cryptocurrency was born in the digital world.
We can easily see how this can be tied to innovations such as a DAO. As these gain more legal rights, after being adopted on a larger scale, the financial (monetary) aspect is going to drift towards crypto. This is the only sensible path.
This exemplifies the problem that people who believe cryptocurrency is a fad have. How do you separate crypto from the digital world. That is like trying to remove compute from the equation. It is impossible.
One of the main problems with the Internet is that it was not designed for commercial activity. That means it had no monetary system.
Consider the likes of PayPal. Why does it exist?
The answer resides in the fact the original protocol did not allow for commerce. Many envisioned the Internet as an information sharing mechanism. While it did fulfill that role, we also saw the emergence of this as a commercial mechanism.
Thus, PayPal was formed as a payment layer. It was not an inherent characteristic of the world of networks.
That all changed with cryptocurrency. With this introduction, networks suddenly had monetization that was native to it. Nothing more was required.
If we look at Bitcoin, a transfer of value can occur without any secondary applications. It only requires the ability to access a wallet, i.e. having the key, and enough to pass the transaction fees.
The Internet of AI
If computing is changing, which I have theorized, we are going to see a change in the Internet.
Our future is one where AI agents, once developed in the millions (hundreds of millions) will be connected. They will operate similar to the existing network of computers. The difference is they will be digital.
This means we will have the Internet of connected computers which has a layer of inter-connected AI agents on top.
The network of agents will take over a great deal of the economic output and productivity. If these are eventually tied to robots, which is very probable, we can see how the entire economic system changes.
Of course, the issue of control and trust enters. Here is where blockchain can provide enormous value.
Since we have a transparent verification system, it is easy to see what actions were completely by a certain "wallet". This means whatever the agents are doing on behalf of an individual wallet owner is tracked. It also feeds into the reward systems that will be built.
Distributed computing also offers a change at the hardware level, also bringing cryptocurrency into the equation.
Thus, we are looking at networks of nodes that run connected AI agents, generating economic output which is paid in cryptocurrency (yet might be denominated by energy) autonomously to the owners of the different wallets.