Two technological phenomena and two transformative forces have dominated our world in 2023: Web3 and AI.
You might have already encountered each of them on your digital journey. But have you ever wondered what would be if we combined Web3 and AI? What does this mix mean in the world of the crypto industry and particularly for your business?
Integrating AI and Web3 is not just theoretical; it’s already happening. For example, Solana has integrated an AI language model developed by OpenAI. At the same time, Ethereum-based projects like Numerai leverage AI algorithms to optimize their data and trading strategies.
The AI-Blockchain convergence marks the beginning of an exciting era where the potentials of AI and the decentralized Web3 world combine to shape the future of technology and innovation.
Read this blog post if you are interested in how and in which ways Web3 and AI are complementary to each other. Learn what are the benefits of such cooperation, what are the key areas where this synergy would work best, and what are the use cases.
Let’s start the ball rolling!
What is Web3 and AI?
As we stand on the cusp of a new technological era, there is no chance to avoid such advancements as blockchain and artificial intelligence.
It’s been a long way to the formation of Web3, starting with Web1 and Web2.
Web1 was all about providing a static and text-based platform for the dissemination of information. With Web2, we saw the emergence of interactivity. Common examples include Facebook and YouTube. Finally, Web3 focuses on decentralization, aiming to avoid such things as centralized control or privacy concerns, such as exploiting user data for targeted advertising.
If you want to know about Web3 and why it is important today, then reach out to this blog post.
At the same time, AI means the ability of machines to do the tasks that humans commonly perform. AI applications are expanding daily, making them a building block for many Web3 ecosystems. In the Web3 context, decentralized artificial intelligence is pivotal in crafting tailored user experiences through decentralized data marketplace analysis, tailored user experiences, or interaction patterns.
How AI in Web3 Makes Layers of Web3 Intelligence
In the context of AI and Blockchain, layers mean that artificial intelligence is not just a fixed thing.
The base layer might involve basic capabilities like AI-driven data analysis and automation. The next layer could add more advanced features like predictive analytics or natural language processing. Each subsequent layer upon the previous ones allows the system to become progressively smarter and use more advanced tools.
Intelligent Blockchains: Enhancing blockchain technology with AI
Intelligent blockchains help blockchain be smarter with AI.
Imagine your blockchain is similar to a virtual assistant in the world of crypto transactions. It learns and makes decisions based on an excessive amount of information. With AI, your blockchain would become more efficient and capable of handling much more complex tasks. It gains the ability to not only securely record transactions but also analyze data, detect patterns, and autonomously execute smart contracts.
Intelligent Protocols: The role of AI in improving Web3 protocols
Intelligent protocols are like rules that Web3 should follow. And AI can significantly improve these rules.
Intelligent protocols act as vigilant guardians, using AI to detect anomalies and malicious activities in real-time. By continuously monitoring network behavior and analyzing patterns, these protocols bolster the security of Web3 networks, mitigating risks associated with fraud, hacks, and network attacks.
Intelligent dApps: AI-driven decentralized applications
The decentralized applications use AI to do more than just basic tasks. It’s like having apps on your phone that are super smart and can learn from your preferences. AI-powered dApps can make your users’ interactions with blockchain networks more advanced and customized to their needs.
Benefits of Co-evolution of the Two Technologies
Better Decision Making: Leveraging combined insights for informed decisions
Imagine AI techniques and Web3 are two friends working together. When they team up, they bring some great advantages. Two heads are always better than one. And here, AI and blockchain are willing to share their knowledge to help make smarter decisions.
For example, better decision-making means decisions your users can make would be based on the vast amount of information AI provides, which is like having a super guide.
By continuously monitoring network transactions and blockchain activities, AI offers real-time analytics, and valuable insights and shows current trends and patterns.
Secured Personalized Experiences: Enhancing user privacy and customization
The question of privacy is paramount in the crypto industry. The convergence of AI and blockchain ensures that your audience’s user experience is not only customized but also secure. Because there is so much sensitive information, your crypto project should be a security guarantee no less than a bank system.
With secured personalized experiences, people share information when the time is right and other parties are trusted. They are the gatekeepers of their own secrets.
Higher Trustability: Building trust through transparency and accountability
Trust should not be built on blind faith. It is important that every transaction, every record, and every promise can be traced and verified.
In this case, AI is the vigilant eye that watches over the blockchain, ensuring that every action adheres to the rules. By providing real-time monitoring and analysis of blockchain transactions, AI quickly detects any anomalies or suspicious activities that may compromise security. It can also assist in identity verification, ensuring users’ digital identities are secure and verified without central intermediaries. AI-driven transparency tools audit smart contracts and data, enhancing accountability and maintaining the integrity of decentralized applications and platforms in the Web3 ecosystem.
Key Web3 Areas Where AI Shows Promise
The cryptocurrency landscape has been a rollercoaster ride.
Being faster than your competitors is important to go out on top. AI is your secret tool that could significantly impact in so many ways that it’s hard to cover. Let’s list key areas where AI shows promise in the Web3 ecosystem:
Smart Contracts: Automating contracts with AI
Smart contracts are special programs that run when predetermined conditions are met. They can make a huge difference for businesses when appropriately implemented, all due to their transparency, security, and accuracy.
How does AI bring value to smart contracts?
- Code analysis and security
AI-enabled smart contracts can analyze smart contract code for vulnerabilities and suggest improvements, reducing the risk of exploits and hacks.
- Automated contract generation
AI models for smart contracts assist developers in creating smart contracts by generating code snippets, simplifying the development process, and reducing the likelihood of coding errors.
- Dynamic contracts
AI smart contracts could adapt to changing conditions or external data, making them more versatile and responsive to real-world events.
Decentralized Autonomous Organizations (DAOs): Governance with Artificial intelligence
Decentralized Autonomous Organizations represent a new way of organization and governance of communities or entities. Web3 governance models are needed because they offer a decentralized, transparent, and trust-based approach, which provides a framework for communities and entities to collaborate, make decisions, and allocate resources more democratically and efficiently.
The combination of AI models and DAOs can help address the following issues:
AI-powered algorithms can provide data-driven insights and recommendations for DAO members, aiding decision-making.
- Voting and Consensus
AI can facilitate secure and transparent voting mechanisms within DAOs, ensuring that votes are accurately counted and preventing fraud.
- Proposal Analysis
AI can analyze and categorize proposals made within DAOs, helping members prioritize and focus on the most relevant issues.
Decentralized AI: Synergy between AI and decentralized technologies
The synergy between AI and decentralized technologies can open various possibilities.
- Cross-chain AI
AI can bridge the gap between different blockchain networks, enabling interoperability between AI applications running on separate chains.
AI can act as decentralized oracles, providing real-world data to smart contracts and dApps, enhancing their functionality and utility.
- Tokenomics and Predictive Analytics
Artificial intelligence can assist in analyzing blockchain data to predict market trends, token values, and user behavior, helping investors and developers make informed decisions.
Now we know in which ways AI can help your business by revolutionizing various aspects of Web3. Let’s see particular use cases of Artificial Intelligence for blockchain.
Use Cases of the AI-Blockchain Convergence
Here are real-world examples of companies getting the most from the powerful combination of AI and Web3.
MedicalChain is a platform built on blockchain technology. It employs AI algorithms to ensure the secure storage and confidential sharing of patient medical records, all while preserving data privacy and integrity.
Utilizing blockchain technology as part of its Web3 infrastructure, MedicalChain ensures that patient medical records are stored in a highly secure and tamper-resistant manner. AI algorithms further bolster this security by continuously monitoring access and flagging any suspicious activity, enhancing data protection.
With this combination, patients have greater control over their medical data. Through smart contracts and decentralized identity solutions, patients can grant or revoke access to their records, ensuring privacy and consent in a transparent and auditable manner.
This AI blockchain project leverages artificial intelligence algorithms and blockchain technology to analyze and mitigate risks within the insurance sector. It automates the claims processing system and enhances the ability to detect fraudulent activities.
Aigang employed AI algorithms to assess and predict risks associated with various insurance products. These algorithms analyzed a wide range of data sources, including historical data, sensor data, and external factors, to make more accurate risk assessments. This AI-driven approach allowed for dynamic pricing and risk management, ensuring fairer and more responsive insurance policies.
Moreover, artificial intelligence enhanced fraud detection capabilities within the insurance sector. By analyzing data patterns and anomalies, AI algorithms could identify potentially fraudulent claims or activities more efficiently. This saved costs for insurers and helped maintain trust in the insurance ecosystem.
Banking: Kasikornbank (KBank)
Interestingly, the tendency also covers organizations willing to help startups integrate AI and Web3 in the work processes.
For example, Kasikornbank (KBank) based in Thailand, has launched a $100 million fund to invest in startups globally. The fund will focus on startups in the fields of artificial intelligence, Web3 (next-gen internet), and fintech (financial technology). This initiative aims to support and collaborate with innovative companies working in these areas globally.
Fetch.ai is a blockchain-based AI platform that focuses on enhancing various industries through decentralized AI models and machine learning. For example, Fetch.ai’s platform enables the creation of autonomous agents that use AI algorithms to make decisions and perform tasks on behalf of users. These agents can negotiate and execute smart contracts autonomously, making decisions based on real-time data and AI analysis.
As we have explored a range of use cases and peered into future trends, the symbiotic relationship between AI and Web3 becomes abundantly clear. AI’s integration not only enhances existing applications but also unlocks new dimensions of possibility in the decentralized world.
This partnership opens doors to intelligent blockchains, adaptive protocols, and user-centric dApps that function seamlessly and continuously evolve in response to the needs of a diverse and dynamic user base.
Ready to embrace the future of AI and blockchain? Let’s explore the possibilities together. Contact us now to embark on this exciting journey!