Can Artificial Intelligence Boost Crypto Business?

By Kapil Rajyaguru

It’s safe to say that the world has become increasingly focused on artificial intelligence (AI) since the release of AI-infused art platforms like Dall-E, Deep AI, Jasper Art, Starry AI, Nightcafe, and others. In the past two months, the Openai platform Chatgpt or GPT-3 has become a widely used AI phenomenon.

AI is a breakthrough technology with the potential to fundamentally change countless industries, crypto among them.

Enthusiasts view it as a key component of new financial and social ecosystems, including the project of decentralized finance (DeFi). It’s no surprise, then, that many new cryptocurrency projects are closely intertwined with aspects of AI. Below, we explore AI tokens in more depth and take a closer look at a few popular examples.

Simply put, AI tokens are cryptocurrencies that utilize AI in some way to improve security, user experience, scalability, or a variety of other factors. In theory, AI can be trained to further automate and build trust or efficiency in many crypto systems. AI tokens can also be digital currencies designed to power AI-based apps or projects, including decentralized marketplaces or exchanges, image or text generation services, AI-based investment protocols, and more.

The crypto space—and the worlds of business, education, and more—have been buzzing about ChatGPT since its release in mid-2020 and particularly starting at the end of 2022 as it gained widespread popularity. ChatGPT is a chatbot developed by OpenAI, designed to generate human-like text and to perform a multitude of language tasks such as processing information, answering questions, and more.

The potential for ChatGPT to further disrupt the crypto space is huge. For instance, Justin Sun, creator of the tron blockchain and token, has outlined a possible AI-based decentralized payment framework based on and supporting the chatbot.

Perhaps more importantly, the sudden ubiquity of ChatGPT has sparked new interest among both crypto investors and those outside of the community in the possibilities of AI technology.

As of early May, 2023, the total market value of all AI tokens was about $4.33 billion, small compared with the broader crypto space. But this is growing quickly, particularly as institutional investor cash continues to flow toward AI.

What are the challenges and benefits of AI tokens?

AI tokens are building momentum but nonetheless face challenges. These include:

• The uncertain future of regulation surrounding the cryptocurrency market
• Competition from both AI projects and digital tokens,
• Lack of public understanding about the details of many AI-based projects, which can be quite complex.

On the other hand, benefits of AI tokens include the built-in decentralization and security achieved by blockchain networks and limitless possibility for new applications and use cases.

These are some of the AI tokens that have benefited alongside ChatGPT.

AGIX

AGIX is among the most popular AI tokens today. It is the token native to the SingularityNET decentralized platform. SingularityNET provides an open-source, decentralized blockchain market allowing users to buy and sell a wide variety of AI-related products and services. One of the key features of this platform is that it allows trades of models, data, and other tools used to improve AI through training. In this sense, SingularityNET is a platform both powered by and designed to benefit AI.

FET

FET is the medium of exchange for the Fetch.ai system. Fetch is a decentralized platform used to build intelligent, autonomous software and tools. It makes possible the launch of data analytics, decision-making, and prediction bots.

NMR

NMR is a token associated with the Numerai AI-based decentralized hedge fund. Numerai is a model for how artificial intelligence may be used to inform investment decisions. It utilizes a crowdsourced set of predictions from data scientists around the world as it considers possible investments. Contributors to those predictions are rewarded with NMR tokens for accurate forecasts.

ALI

ALI, standing for Artificial Liquid Intelligence, is a token used by the Alethea image generator. Alethea uses AI to create images based on input from users. It is known for CharacterGPT, an AI protocol that uses text descriptions to generate interactive AI-based characters. ALI tokens are used in the generation of character NFTs as well as for upgrades, incentives, and transactions.

HERA

Hera is a token tied to the pathfinder algorithm of the same name. Hera aids participants in the DeFi ecosystem to target the most efficient, profitable trading paths on decentralized exchanges. It utilizes machine learning algorithms which analyze prices, liquidity, trading volumes, and other data. Hera tokens allow users to participate in governance for the project and to share in protocol revenue.

It is uncertain how long the demand for AI-based crypto assets and the popularity of these tokens will last. All of the AI-related crypto assets are currently ranked below the top 75 in terms of market capitalization and have recently seen price surges due to increased interest in AI/Chatgpt.

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