Cobo COO: Four Possibilities of AI and Blockchain Integration

Author: Lily Z. King, Cobo

Compiled by: Wu Says Real

Editor's Note: The South China Morning Post published a column by Cobo COO Lily Z. King on May 6, discussing the trend of the integration of AI and blockchain, future development directions, and potential.

• The integration of AI and blockchain can leverage each other's strengths to drive the development of the next generation of the internet.
• This is a vibrant and rapidly evolving field, representing tremendous growth and innovation potential for investors and entrepreneurs.

In recent months, generative AI has dominated the headlines with impressive breakthroughs and applications, such as the AI chatbot ChatGPT, image generators Stable Diffusion and Midjourney. While generative AI is attracting public attention and investment from the tech industry, cryptocurrencies are losing their momentum and appeal. Some venture capital investors have shifted their profiles from "all in on crypto" to "all in on AI."

However, the potential integration of AI and cryptocurrency is underestimated. They should not be viewed as competitors in the digital economy. Instead, we should be excited about the potential synergies between the two and their impact on the next generation of the internet. For regulators, investors, and entrepreneurs committed to establishing a global Web3 hub in Asia, it is essential to recognize that the next generation of the internet is likely to emerge from the integration of AI and cryptocurrency.

According to a recent study by UBS, ChatGPT reached 100 million monthly active users just two months after its launch, becoming the fastest-growing consumer application in history. Mass adoption is precisely the main challenge facing blockchain technology. AI can accelerate the mass adoption of cryptocurrency by reducing the complexity and security issues that may become barriers for potential users.

First, AI can provide a more user-friendly interface and tools for interacting with blockchain networks and smart contracts. Chatbots can guide users through their entire journey in the blockchain world, assisting in creating and managing on-chain transactions, answering questions in real-time, and providing support.

Cryptocurrency exchange Binance recently launched an AI chatbot called Sensei. This chatbot is designed to enhance the learning experience around Web3, blockchain, and cryptocurrency. Chatbots may soon have capabilities that go beyond educating users. They should be able to create a more personalized experience for users by providing tailored tutorials, suggestions, and support as they navigate the blockchain world.

One advantage of blockchain is the transparency of all on-chain transaction data. However, accessing and understanding this data can be a challenge. AI-based analytical tools can help users comprehend the data by identifying patterns, trends, and anomalies, providing actionable insights and recommendations.

The blockchain data analysis platform Dune has launched a new feature called "Explain Query." This feature simplifies complex Structured Query Language (SQL) through AI, allowing users to obtain natural language explanations of any SQL query with just a click. Ultimately, users will be able to retrieve the information they need from databases using natural language.

Smart contracts are a fundamental component of blockchain technology, enabling the automatic execution of agreements without intermediaries or trusted third parties. However, smart contract code is currently difficult for the average user to understand and verify. Creating, deploying, or evaluating smart contracts requires specialized developers.

Fortunately, AI can provide smart code generation tools that automatically generate smart contract code based on user input. These tools can also analyze existing smart contracts for potential vulnerabilities and suggest improvements to ensure the contracts' security and efficiency. Isn't it exciting to imagine a future where smart contracts are democratized, allowing anyone to write and use them to facilitate collaboration with others?

One of the biggest challenges facing AI is ensuring data integrity and privacy. Blockchain technology offers a solution to this challenge by enabling secure data sharing while maintaining data privacy. By leveraging the transparency of blockchain, businesses can create a trusted and secure data-sharing network for AI.

More importantly, AI agents seem likely to become the norm soon, taking over various online activities, from financial management to travel and entertainment bookings. While AI agents cannot establish social media or financial accounts like humans, in this new world, cryptocurrency wallets may become the primary means for AI agents to establish online identities and conduct transactions with the owner's authorization.

This may sound a bit strange, but in reality, AI agents need cryptocurrency finance more than humans do. The code-based blockchain world is the perfect environment for AI agents to operate autonomously and transact according to the rules set by the code, while leaving a transparent record for human oversight.

So far, what I have discussed is just the tip of the iceberg regarding the promising synergies between AI and cryptocurrency. I have always believed that previous narratives about Web3 were somewhat hollow—tokens alone cannot bring about the next generation of the internet.

However, the combined transformative power of AI and cryptocurrency may ultimately fulfill the promise of Web3, empowering users and builders in unprecedented ways. The intersection of AI and cryptocurrency is a vibrant and rapidly evolving field with immense growth and innovation potential. This presents numerous opportunities for investors and entrepreneurs. Now is an exciting time to be at the forefront of these cutting-edge technologies.