By Daniel Shin The convergence of cryptocurrency and AI holds significant potential, but it is associated with a complex landscape of risks. For instance, AI models are only as good as their training data. Blockchain can help ensure data quality and authenticity, but challenges remain in handling noisy or biased data.
Both AI and blockchain also face scalability challenges. The marriage of crypto innovation and AI has the potential to transform various domains of the financial system. However, practical implementation requires addressing technical, ethical and philosophical challenges.
In theory, blockchain ensures secure and bullet-proof data storage. This is also crucial for AI because accurate data is essential for training robust models of AI. The decentralized nature of the blockchain may also be enhanced by AI, reducing its reliance on centralized servers and improving data privacy.
Some argue that smart contracts are great use cases as combining AI with smart contracts in the blockchain can automate processes, help verify data and execute agreements more transparently. Cryptocurrency’s decentralized system could potentially upend the role of central banks in future financial infrastructure. However, it is unlikely to replace central banks anytime soon.
Central banks will continue to play a crucial role in managing economies, controlling inflation and stabilizing financial systems. Cryptocurrencies and blockchain technology are already reshaping the financial landscap.
