12 things blockchain protocols should consider when exploring AI
Across the industry, it seems that all everyone is talking about is artificial intelligence. Even companies that are not technologically advanced are scrambling to discover how AI works and what it can do for them. Given the impact that AI is expected to make, it is not surprising that blockchain protocols — part of a very technologically advanced industry — are exploring what role AI can play for them.
From data analysis to improving scalability to driving interoperability, AI can prove to be a powerful tool in the blockchain protocol arsenal. However, it is important to carefully review not only all the potential benefits, but also the possible complications. Below, the 12 members of the Cointelegraph Innovation Circle discuss some of the things blockchain protocols should consider as they start exploring AI.
Privacy preservation and data security
Because AI relies on large amounts of data for training and decision making, protocols must prioritize strong encryption, anonymization techniques, and secure data handling practices. In addition, implementing privacy-enhancing technologies such as federated learning or differential privacy can reduce the risk of disclosure of sensitive information. – RJ Philips, Zoop
The team behind AI products
Carefully consider the team behind each product. While many AI builders promise great results, you should always make sure to research their historical performance to determine if the projected results are truly realistic. Overall, the protocol should look for companies with a consistent track record of delivering quality products on schedule and on budget. – Wolfgang Ruckerl, ENT Technology AG
Maintain and/or increase decentralization
Protocols should prioritize the design of AI solutions that maintain or enhance decentralization, perhaps through the use of distributed AI models or decentralized decision-making algorithms. In addition, the protocol must consider the potential risks associated with AI, such as bias and security vulnerabilities. – Tammy Paula, Zerocap
Ethical use of AI
Ethical frameworks and guidelines should be put in place to address issues of bias, fairness and responsible use of data. The protocol user experience must also be seamless and straightforward so that AI-enabled blockchain solutions are easy to use and understand. Protocols can lead to solutions that are technically sound, ethically sound, and user-centric. – Myrtle Anne Ramos, Block Install
Balancing privacy and power
Dance with two giants! As you usher AI into the blockchain space, remember that it is a dance between privacy and power. AI craves data, but blockchain champions privacy. Striking the right balance is key: Harnessing the power of AI without compromising the privacy sanctity of the blockchain. It’s a delicate dance, but when done right, it can change the blockchain ballet! – Erki Koldits, Or Popspot
Are you able to offer real added value
Many of today’s so-called “AI tokens” are simply traded on hype — riding the marketing wave. But once the market realizes it, it will just throw the protocol away. Never try to market your protocol as something it’s not. If you can’t provide real AI added value, but just copy some code from ChatGPT or other sources, don’t do it. – Zain Jafer, Zain Ventures
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How (or if) AI contributes to your mission and vision
AI could easily be a game changer for many technology and protocol companies. The key to success is ensuring that your AI angle, initiative or element contributes to your original mission and vision. If it helps you scale it up or get there early, it’s definitely a potential strategic pillar of your roadmap. Otherwise, leave completely, and don’t get distracted! – German Ramirez, HOUSE OF RELEVANCE AG
AI mutability
By design, AI is not fixed. It can give two different answers to the same input at two different times, depending on experience. The role of the blockchain protocol is to be consistent over time. There is an underlying tension; combining AI can undermine the value of blockchain protocols. Using AI to learn how to write new smart contracts is a different story — if not touching on protocol. -Stephanie So, Geez
The increasing need for pen testing
As the capabilities of large language models develop, it will become increasingly important to conduct periodic (eventually continuous) penetration tests. Additionally, there needs to be multiple comprehensive code audits completed by a reputable provider prior to launch. – Timothy Enneking, Digital Capital Management
Projects rushed to market
When a topic captures the popular imagination, companies will accelerate solutions to meet growing demand. However, this can also lead to dilution in the service as a whole, as underdeveloped products enter the market with the sole purpose of capitalizing on the craze. To protect participants, crypto leaders must check the competence and effectiveness of all projects before granting network access. – Oleksandr Lutskevych, CEX.IO
Various use cases
Protocols can open up a series of exciting new use cases with AI. For example, DeFi and trading protocols can quickly identify arbitrage opportunities using AI. Governance protocols can predict voting results or identify anomalies in transaction behavior. Data protocols can characterize AI data and make AI output transparent, decentralized and censorship-resistant. The opportunities are endless. – Shiva Madan, Moonwalk
The fact that AI is not going away
Blockchain protocols should prepare AI to become a permanent fixture rather than a short-term craze. Therefore, the protocol must treat AI very well. Enterprises must select and implement AI solutions carefully to avoid embarrassing performance and scalability issues down the line. – Sheraz Ahmad, STORM partner
This article was published through the Cointelegraph Innovation Circle, an organization of senior executives and vetted experts in the blockchain technology industry who are building the future through the power of connection, collaboration, and thought leadership. The opinions expressed do not necessarily reflect those of Cointelegraph.
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