Web3 and artificial intelligence are complementary technologies – Michael J. Casey

A tweet this week from Chris Frantz, the founder of email platform Loops, irked me.

Frantz said “90% of the people I know in web3 have turned their company to AI.”

What struck me was not that founders are so obsessed with raising venture capital that they will go after the next “in” thing. (Let’s save that problem of Silicon Valley fickleness for another time.) It was people seeing the various elements of the complex new digital economy forming around us – artificial intelligence, blockchain, the metaverse, programmable money, digital identity, cryptographic proofs, quantum computing, IoT and so on – as unrelated, interchangeable pieces, when they are actually intertwined and complementary.

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AI will need Web3, and vice versa. Why not build both?

I see this harmful, reductionist simplification of “Web3”, “blockchain” and “crypto” as stemming from a fundamental failure to identify the core, unifying feature of all projects that fall under those labels. To me, the commonality is that they all use a new system of distributed record keeping and incentives to deal with the basic problem of human trust around information. These technologies help communities of distrustful strangers to collectively maintain open data records that allow them to distribute and share valuable (or sensitive) information among themselves without the intervention of middlemen.

In addressing how to keep valuable information secure in a decentralized environment, Web3, crypto and blockchain address a societal challenge that has been with us since the dawn of the Internet. But now, in the age of AI, when information uncertainty is set to become stratospheric, this is an even more urgent matter.

So why do people – whether they’re founders flipping from one fad to the next, or policymakers who think crypto is just for money laundering – fail to understand the overarching importance of this new data architecture?

At the risk of being sanctimonious, I think it goes back to the roots of cryptocurrency, with the founding of Bitcoin.

Back then, the messages should have been about information, about data sharing, about protecting privacy – essentially the primary concerns of the cypherpunks whose mailing list Satoshi Nakamoto used to unveil the Bitcoin white paper in October 2008.

Now, I don’t really blame Satoshi here. The founder simply offered one of a number of information solutions that the cypherpunks had argued about for years: a cryptography-based digital currency. Satoshi knew that, while money is special in terms of its fundamental importance to society, it is really just another form of information.

Money is not a thing. It is a standardized, commonly agreed symbolic representation of value. It is a specific type of information that, because it is highly valued, requires an elaborate, institutionalized system to instill confidence that people and entities will not misuse it. But it is far from the only type of information that carries value and, by extension, requires institutional coordination. Therefore, for me, Bitcoin was a prototype for a much bigger idea.

Of course, there were many early Bitcoin believers, including Ethereum founder Vitalik Buterin, who got it. They realized that this decentralized data architecture could be applied to the many problems we face in sharing valuable information in the digital age.

The problem was that in the eyes of the general public, as well as those of regulators who wanted to stick this strange square peg in the round hole of traditional finance, cryptocurrencies and blockchains were purely about money.

That misunderstanding set us back and perpetuated a Web2 structure of harmful data manipulation by giant Internet platforms that sowed distrust in our information systems and democracy. Had a broader understanding of the potential existed, this industry would have more easily addressed its inherent scale, legal and privacy challenges. Perhaps there was less of an instinct for scams and “number up” sign casinos, and more of a drive to build meaningful solutions to the world’s problems.

But, now? Now, in the age of artificial intelligence, this misunderstanding becomes downright dangerous.

Please don’t accuse me of naïve “blockchain fixes this” handwaving. The challenges of the AI ​​moment are daunting, from protecting copyright in the inputs of large language models (LLMs), to avoiding racial bias in their outputs, to the “liar’s dividend” promoted by our current inability to differentiate between real content and AI creations created. There is no easy way to save humanity from the machines. Whatever solution emerges will inevitably draw on a wide range of technologies and policies.

Here’s what I do know: We’re not going to solve these cases with an antiquated 20th-century regulatory technology stack. We need a decentralized governance system for how we produce, verify and share information in this new era.

Whether or not they, as currently designed, can deliver what is needed, blockchains do have properties that can help.

Immutable ledgers allow us to trace the provenance of images and other content and therefore can protect against deep forgeries. The same can be true for testing the integrity of the datasets on which machine learning AI products are trained. Cryptocurrencies can be used to pay people worldwide in a borderless digital way for their contributions to AI training. Projects like Bittensor are building tokens of blockchain governance communities that incentivize AI developers to build human-friendly models (addressing concerns that AI systems owned by private corporations are incentivized to put the profits of shareholders above the rights of users. )

There is a long way to go before these ideas can deliver on this promise at the scale needed, if they ever will. Success will also require the integration of a range of other technologies—zero-knowledge credentials, homomorphic encryption, secure computing, digital identities and decentralized credentials, IoT—as well as smart, multi-stakeholder legislation that protects privacy, punishes bad behavior, and encourages human-centered innovation.

But to position Web3, blockchain, crypto, or whatever you want to call it as an existence with no place in the emerging digital future is to seriously misunderstand the problem at hand.