When AI meets Blockchain
Blockchain is believed to have the same potential as the internet that can open doors to creative possibilities and unimaginable boulevards for innovations. It is a distributed, immutable, trustless and secure database that is accessible by all the parties present in that distributed network.
Another paradigm shift in technology that is gaining attention from around the world is that of Artificial Intelligence. The ripples caused by this technology is evolving businesses and bringing in creative innovations in industries. Artificial Intelligence is the name given to a set of instructions that facilitates a computer to be the creator of its own algorithms. It can do this even if it is not programmed for the same and acquire new knowledge on its own
Let us look at the possibility where Artificial Intelligence assists Blockchain:
Blockchain has its own set of pros and cons that limit its potential. With AI, most of these limitations can be addressed, enabling Blockchain to realize its full potential.
- The rate of expansion of Blockchain (Bitcoin) is 1 MB every 10 minutes. At this rate, soon Blockchain will be requiring a lot of space. To cater to this problem, Blockchain pruning is proposed that’ll cut down the unnecessary old data, but if Artificial Intelligence is brought into the picture then a lot of efforts can be saved. It’ll employ decentralized learning systems similar to federal learning that’ll perform data sharding.
- The cost of validating and sharing transactions is huge. If we go by the 2016 report of Deloitte, it costs more than $600 million for a smooth functioning of these operations. With AI, a smart system can be installed that may aid the miners in validating the transactions in a manner that cuts total costs and time.
- Digiconomist shared its stats which estimated that Bitcoin consumes 71.12 TWh of electricity annually. The annual global mining revenue is around $5,332,047,485 earned at a cost of $3,556,216,066. Artificial Intelligence is proved to cut energy consumption by optimizing energy usage and also by addressing the major challenge of Bitcoin mining. Not only this, the optimization will also lead to reduced investment costs that goes into mining hardware.
- If we consider a future where most of the data is stored in Blockchain, then we also assume that various organizations will be remunerating money to access the requested data. Compiling and processing these requests and data quickly needs a high level of intelligence. AI will be the perfect fit that’ll process these requests and allow organizations access to this data, along with tracking how the information is being used.
- One of the major concerns of companies storing private data on Blockchain is that the data is open and accessible by all participants. This triggers major strategic and regulatory concerns among the regulators. Additionally, the layers and applications created on the Blockchain are not as secure as the Blockchain network itself. AI can address this problem by making the apps and their deployment secure, creating a uniform app structure throughout.