Blog: The Significant Potential of Artificial Intelligence in Blockchain – The Fintech Times
Author: Ramendra Kishore
Artificial Intelligence and blockchain are two buzzwords that seem to stimulate great interest in the tech community today. While both technologies are said to be cutting edge and futuristic, there seems to be little in common between the two. As such, the idea that the two can be incorporated, much less to the mutual benefit of each other, seems far-fetched. But this is far more feasible than you thought.
Blockchain and AI: Far yet close
Artificial intelligence was first thought of in the 1950s, but it was only since the 90s that any real progress was made. Today, AI has filtered through the market chain and is now available as a consumer product in the form of virtual assistants like Siri and Alexa. Despite the great interest in the field, AI hasn’t grown as fast as other technologies over the decades.
As you might have read through Bitcoin News, Blockchain technology is a decentralized digital ledger spread across systems (called nodes) for storing data. These chunks of data, once formed into blocks, are immutable and cannot be changed. They are also encrypted to ensure security.
While both AI and blockchain seem like two very different technologies, there is one thing that binds them: data. AI works by hogging big data for training, while blockchain is used to store huge amounts of data.
Incorporating AI into Blockchain
Blockchain technology, being decentralized, operates by creating nodes (essentially separate systems) on a network where each node stores a portion of data; all of this data is free of any central control. However, if every node has access to data, it can put the privacy and security of the entire data at severe risk. To deal with this, blockchain encrypts the data before storing it in the nodes.
This works great for safety but puts a great hurdle on accessibility. After all, how does one access such data? Encryption is necessary and giving the decryption key to anyone will defeat the whole purpose of decentralization.
Artificial intelligence works as the perfect solution to this dilemma. Since AI is a non-person, having it access the encrypted data does not put privacy at risk. AI can also provide a great interface that decrypts the required data in the background and providing users with the results they asked for.
Nonetheless, there is more than one arena where AI benefits blockchain. The entire blockchain network works on huge and complex instruction sets that decide what happens where across the nodes. Currently, the procedure of creating and executing these instruction sets is tedious and not very efficient. However, AI can be trained to execute these instruction sets with optimum efficiency, thus improving the functioning of blockchain to a great degree.
Incorporating Blockchain into Artificial Intelligence
Any AI model goes through an extensive training process where a huge amount of data is fed, and the model is guided to give the right answers. Through innumerable passes, the AI learns to give answers that might even surpass expectations. But how exactly does it manage to do that? We don’t know. The AI acts like a black box: we know the input and the output but can’t be sure of how the transition took place.
Blockchain technology can vastly help in that regard. Since blockchain is decentralized and spread across entire networks, there is no real limit to how much data it can store. All of this data is also immutable. When you incorporate blockchain into AI, it can store the information of each training pass, including details like weights assigned. This treasure of data can actually become a goldmine in demystifying artificial intelligence and making vast improvements in how we make intelligent machines.
Blockchain and AI might not look like the match made in heaven, but they have a huge potential of mutual benefitting if used correctly. No doubt, they can do wonders in the development of many sectors when combined together.
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