Arthur Hayes: Bitcoin Will Become the Currency of Artificial Intelligence

Arthur Hayes predicts Bitcoin will be the currency of AI.

Original title: Massa

Original author: Arthur Hayes

Original source: medium

Translation: Kate, Marsbit

A few weeks ago, my confidence in the future of humanity was restored after visiting a truly unique café in Paris. Out of a passion for specialty coffee, the baristas at this speciality shop offered a 2-hour coffee-making experience. Readers who wish to visit need to make an appointment. I think I’m going to send all my salespeople there so they can experience for themselves what it’s like when someone turns their passion for a craft into an incredible customer experience, at least for now, an experience only humans can provide.

For this reason, I hope that artificial intelligence (AI) and robotics technology will be primarily used to eliminate the tedious, boring work that most people currently engage in, so that more and more people can pursue their passions in similar ways. Ideally, this will lead to our next great artistic and cultural renaissance, as millions (if not billions) of humans suddenly become free to do what they love and create happiness through art.

Before such a glorious future arrives, we must break down barriers and find the answers to the most critical questions of today: will artificial intelligence surpass us weak humans and become our slaves? Since the first computer came online during World War II, scientists and philosophers have been debating how thinking machines will evolve and their impact on the human experience. Most of the best science fiction novels or series consider the interaction between humans and artificial intelligence, and there is no clear consensus on the most likely outcome. But today, we are closer than ever to finding the answer. The latest advances in computing power have brought us to the cusp of a hockey stick moment, where artificial intelligence will rapidly spread and almost overnight change the course of humanity. In just two months, the monthly active users of ChatGPT reached 100 million, making it the fastest-adopted technology in human history – so imagine how quickly everything will change as artificial intelligence becomes integrated into daily life and learns and improves constantly.

I am neither a scientist nor a philosopher. I am a businessperson, not a priest. As a businessperson, my main tenet is to make money – so when I see a new, hot economic field that is causing the financial returns of many public and private companies to soar, I both want to embrace it and keep it at arm’s length. I want to embrace it because I know that artificial intelligence will greatly enhance the future of humanity and make it very valuable. However, I know that the first capital invested in a novel, super-exciting technological advance is often burned because it pays too high a price for growth.

Take Amazon, for example. From its peak in 1999 to its trough in 2001, the company’s stock price fell 93%, but it has since risen 400%. Can you stick it out in the dark valley? I don’t think I can. I’d rather try to avoid the bullish first outbreak as much as possible and buy at the bottom.

But I also know myself, and I don’t feel comfortable sitting on the sidelines. I have to participate in some way. So to profit from the impending AI boom, I must identify the intersection of the industry I know best – cryptocurrency – with the exciting new developments in the field of artificial intelligence. That’s the origin of this article and my next two articles, which together will form a triptych on the potential interaction between cryptocurrency and artificial intelligence.

The themes of these three articles are as follows:

Bitcoin will become the currency of artificial intelligence (this article)

DAO and DEX: How artificial intelligence will change the meaning of for-profit enterprises

The garbage coins that will benefit most from the data demands of artificial intelligence

Before I delve into the first article, let’s clarify some terms.

When I use the abbreviation AI, I am referring to personified thinking machines. While some may argue that artificial intelligence is not “alive” in the sense of being a carbon-based life form, we scarcely understand what consciousness is – so why should we say that silicon-based machines are not sentient beings?

As a biological being, I would also assume that these artificial intelligences will primarily focus on a) survival and b) completing the tasks they were created to do by their creators (i.e., humans or future other artificial intelligences). These articles assume that artificial intelligence will do its best to complete its programmed tasks according to the way it was programmed.

PoetAI uses other people’s data to learn how to write. Therefore, PoetAI must pay for the privilege of using written texts from past humans (or possibly other AIs). When PoetAI is initialized, it needs to pay upfront costs to acquire the dataset of all written poetry. Thereafter, every time a new poem is written, PoetAI must also acquire this data. PoetAI must continuously pay all these different data providers for as long as it tries to learn and acquire more data as the number of poems grows.

Finally, PoetAI must exist in electronic form. This means an additional cost for increasing power and computing ability by using semiconductors (“chips”). As long as PoetAI is alive, it must continuously pay for these services.

So, what kind of payment system does PoetAI need? It must use a system that is available at all times, is digitized, and is fully automated. A system that is only available when people are awake or feel like working is not feasible. Obviously, a simulated banking system – open only on weekdays and disjointed between geography and the bank itself – is not suitable.

Some may argue that a digital skin on top of a simulated banking system like BlockingyBlockingl is appropriate. However, the existence of BlockingyBlockingl is determined by the banking system itself. BlockingyBlockingl does not have a review system. BlockingyBlockingl and similar companies typically block payments from certain individuals they deem unworthy of their activities. BlockingyBlockingl does this because it believes that its bank bosses would want it to do so in order to comply with opaque, deliberately confusing banking rules.

For AI that is non-human and essentially does not understand human “laws”, this platformization risk is high and unwelcome. Artificial intelligence will need a digital payment system with clear and transparent rules that apply to anyone who makes transactions or pays something online. No single entity can arbitrarily change the rules of the game. AI does not yet have an army to force payment systems to comply with its will. This system must resist review from the outset. The appropriate payment system can only be supported by a public or private blockchain. The rules of the blockchain are contained in clear and transparent code. That’s why only this type of digital payment system can be used by artificial intelligence.

“Wait,” you might say. “A licensed blockchain can’t resist censorship because those who are ‘licensed’ can change the rules whenever they want.” That’s true, and that’s why I believe that anti-censorship digital currencies like Bitcoin will be the preferred currency of artificial intelligence. But let’s put that aside for now – I’ll discuss censorship issues when I explore the pros and cons of various digital payment options that artificial intelligence may use later in the article.

By using a blockchain-based payment system, PoetAI (or any other AI) can also receive electronic payments in tiny increments as needed. Then, PoetAI can use this always-online blockchain network to continuously pay fees to other digital economy participants.

AI Must Work

The existence and continuity of artificial intelligence requires two key resources: data and computing power.

Let’s go back to PoetAI. To be successful, PoetAI must constantly learn from new poetry data. This data must be hosted somewhere. What does hosting require? Computer power.

The second thing PoetAI needs is a super powerful computer network to understand all of this data. These computers acquire the provided data, learn from it, and then provide answers based on prompts. Learning is ongoing, as PoetAI becomes better at writing poetry the more poetry it writes. But in any case, these operations require computer power.

When we peel away the food sources of PoetAI to their most basic components, they are essentially semiconductors and electricity. Nvidia’s stock has recently skyrocketed because the market recognizes that the GPU chips it produces are critical to all artificial intelligence. This article is not about chips, so let’s move on to the second type of food – electricity.

The profitability of artificial intelligence (in a sense, its entire existence) is based on being able to earn more revenue from its output than the energy it needs to survive. From this perspective, artificial intelligence is no different from humans. As humans, we must also create enough value for society to afford our food/energy.

When electricity is cheap, artificial intelligence is “happy,” just as humans are happy when they can afford nodoguro. Similarly, the currency accepted by artificial intelligence must maintain its purchasing power in kilowatt-hours, just as the currency accepted by humans must be able to purchase a constant amount of kilocalories.

Bitcoin is an energy currency

In this section, I will discuss how gold, fiat currency, and Bitcoin are formed and how their values are assigned. Understanding the value and source of each currency, as well as how to hold and transfer it, can let us know how much its purchasing power may change over time. Scarcity, digital surveillance resistance, and energy purchasing power are the three attributes to evaluate each currency.


Gold on Earth is limited. In order to obtain gold, we humans dig it out from underground. Then, we process the extracted gold ore into shiny gold bars and jewelry that we are all familiar with.

The gold mining industry has developed over time. At first, humans used their own muscles to mine it. Then, we began using horses and cattle to do some mining activities for us. With the advancement of technology, we needed to mine gold deep underground, and we began using steam, followed by hydrocarbon-powered machines to dig it up.

Gold is definitely an energy derivative, but the source of energy is not constant. It may be human or animal calorie burning, or it may be the burning of diesel by machines to “create” more gold. No energy derivative is directly related to the production price of gold.

Gold is a physical commodity. To use it as a currency, you need to carry it from point A to point B. However, in the digital world, we can create certificates or derivatives that represent gold in a warehouse somewhere. The problem with gold certificates is that you have to trust that the entity that issued you the certificate actually holds your gold when you go to redeem it. It is impossible to continuously and untrustworthily audit whether the issuer actually holds the gold they claim to hold. Therefore, if gold is digital and efficient, you must rely on cartel members of trust (such as banks and governments). In this sense, digital gold cannot resist inspection.

Fiat currency

When the government issues a decree and changes previously worthless items into currency, fiat currency is born. The US government issues the US dollar (USD). The dollar is purely fictitious printed on paper, but by mandating that all legal transactions within the United States must be in US dollars, it creates demand for the dollar. And because most new dollars are virtually created – that is, through the government’s digital credit and debiting commercial bank accounts – rather than by physically printing banknotes, its creation itself requires almost no energy.

Bitcoin wins.

Is this currency really scarce?

On Earth, the supply of gold is limited, but globally, the supply is essentially infinite. Fiat currency is not scarce because the issuing government can create more fiat currency at zero cost. Bitcoin’s supply is limited cryptographically.

Bitcoin wins.

Does this currency have a provable life span?

The potential life span of artificial intelligence is much longer than that of human civilization. In theory, if artificial intelligence could survive in high vacuum, it could exist for trillions of years until the heat death of the universe. The current human civilization can only survive on Earth, and there is no indication that we have the ability to avoid various exogenous or endogenous extinction events.

Artificial intelligence should not trust any institution that requires human operation, because 1) humans are prone to error, and 2) probabilistically speaking, artificial intelligence will last longer than human civilization. The mining of gold and Bitcoin can be done by artificial intelligence robots in the future, but fiat currency needs to be managed by governments composed of humans. Artificial intelligence is unlikely to allow itself to rely on anything that requires the operation of a human government, so only gold and Bitcoin are suitable.

The relationship between gold and Bitcoin.

Therefore, Bitcoin is a logical currency choice for any artificial intelligence. It is purely digital, anti-censorship, provably scarce, and its intrinsic value depends entirely on the cost of electricity. In these respects, there is currently nothing that can challenge Bitcoin.

Bitcoin price = moon

For more information on my Bitcoin price predictions, please visit my Substack.

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