AI and Crypto Balance Centralization and Decentralization

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Both artificial intelligence (AI) and cryptocurrency are significant milestones in technology evolution. However, both made waves for different reasons. Cryptocurrency emerged as a rising contender in the technological race with its decentralized nature. In contrast, AI’s interconnectivity has made it an integral part of the tech industry. Given their contrasting natures, friction between the two technological tools was inevitable, but the real picture is more complex, and AI and crypto are gradually finding a middle ground.

The crypto market was severely impacted when the FTX collapsed in November 2022. Around the same time, ChatGPT’s demo model was making global headlines, making investors switch their stock from crypto to AI. Academics and developers began leaning towards AI due to its trendy, long-term, and centralized characteristics than crypto, marked with scandals and a sudden crash. The move from crypto to AI sparked competition between the two tech tools.

AI is a centralized tool. It operates on rules and routines, studies data, and possesses human abilities, giving it the power to decide for them. On the other hand, crypto is a decentralized phenomenon. It is out of government laws, and individuals own their information. Crypto is volatile and threatens the concept of centralization—which regulates “illegal” or “unlawful” behaviors and actions like drug use and gambling—scaring people. AI risks human autonomy and agency, posing a threat to people. It regulates all human conduct, leading to a dystopian future. Moreover, AI bias affects its functioning and results.

However, a deep dive into AI and crypto unveils a different picture. Various AI aspects use crypto technology to decentralize their controls. AI tools that rely on data scraping are facing resistance, as the data owners are unwilling to surrender their personal information to algorithms. Crypto’s homomorphic encryption enables information owners to use AI without AI or AI developers accessing their details.

Similarly, many crypto projects use AI technology to create complex infrastructures out of decentralized sections. Crypto works on the belief that once an application is designed, it should be able to integrate itself as a natural component of any larger machine. While first-gen crypto projects had human contributions, AI offers limitless possibilities for developing more extensive and robust decentralized structures.

In a world governed by algorithms, it is essential to balance centralization and decentralization to advance society while preventing a bleak, robotic, and dystopian future. AI and crypto developers must find a middle ground, as a purely decentralized world could result in an anarchist society, and a world run entirely by AI algorithms can eliminate human agency.

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