The Best Use of Cryptocurrency: Is Combining It with AI the Way Out?

Cryptocurrency and AI: A Winning Combination?

Web 3.0 is no longer talked about as much, but with AI robots becoming increasingly common, the ideals of Web3 will regain relevance. According to GPT-4, Web 3.0 is “the next frontier of internet technology characterized by decentralized, user-centric applications that prioritize data privacy and promote a seamless, interconnected experience”. Today, Web 3.0 is a “innovation” that has been hyped for many years – until crypto prices collapsed and many crypto projects failed, it was one of the least credible ideas of our time. Like crypto, Web 3.0 advocates have never been able to create a real use case for their technology. However, there is a reason why I asked GPT-4 for a definition. I fully hope that the ideas behind Web 3.0 can make a comeback – how to implement a legal and institutional framework for AI robots is worth considering. Suppose you run a charity and want to create and distribute an AI robot that teaches math to poor children. This is good, but the robot will encounter some obstacles. In some jurisdictions, it may need to pay licensing and registration fees, it may need to purchase the latest innovative teaching add-ons, if it operates abroad, it may want to upgrade its translation capabilities, and for various reasons, it may also need money. If AI is allowed to have bank accounts, all of these transactions will become very easy. But this is unlikely to happen soon. How many banks are ready to deal with this issue? Imagine if a bank goes bankrupt and the government has to bail out some robot accounts, there will be strong public protests. Therefore, robots may remain “unbanked” – which will prompt them to use crypto as their core exchange medium. Critics often point out that the dollar is more efficient as a form of exchange than crypto. But if AI robots cannot use dollars, then they will have to use crypto. Yes, some owners may allow robots to access their checking accounts, and other owners may want to determine each robot’s spending through a dollar-based banking system. But I suspect that most people would rather let the robots run themselves, without all the risks and troubles – once again, this brings us back to crypto. It is well known that “agent” robots are often more efficient than “tool” robots, and they will need funds. In addition, many of the functions of these robots may not be owned for liability reasons (do you want to be sued abroad because your robot said or did something?). This will be another force driving robots to operate in encrypted relationships. Initially, cryptographic assets will be existing assets such as Bitcoin and Ethereum. But over time, robots may invent their own tokens for convenience. It can be imagined that these robots will be good at digital computing, so they may use multiple cryptographic assets for decentralization. The robot-based cryptographic economy may evolve to be much more complex than the human-based cryptographic economy. That parallel economy may only account for a small part of GDP. But it will help maintain the price of cryptographic assets. In addition, if humans deal with these robots (perhaps some people want to donate to your math-teaching robot), they also need some cryptographic currency. Therefore, the cryptographic economy based on robots will penetrate into the ordinary economy. The plot is now becoming more complicated. Once there is a cryptographic-currency-based robot economy, this economy will need property and legal systems for the same reasons as the human economy. Suppose you teach robots to buy translation improvement services from another robot-but it is flawed, and you have to teach robots to “ask for compensation”. To enhance trust and reduce transaction costs, many robots will agree to arbitration services in advance, usually provided by another robot. (These robots cannot appear directly in Fairfax County Court and demand justice.) The final ruling will be inscribed on the blockchain and, where necessary, use smart contracts and define new property rights. All of this, in short, is a paradigmatic illustration of Web 3.0.

Some robots may want to promote themselves or establish a core identity, and some may do so by buying symbolic goods and establishing ownership of them on the blockchain. This is also a Web 3.0 idea. At the height of Web 3.0 frenzy, many critics thought it was ridiculous for humans to spend millions of dollars buying NFTs. Why spend so much money just to get a blockchain-based receipt? To prove that you spent so much money, the buyer may not even have any accompanying intellectual property. You can laugh at it, but robots will do something similar. Back to your math teaching robot: Suppose it is competing with other math teaching robots. It may want to create a promotional website – “This is my portfolio, come here to learn calculus!” Maybe it depicts Isaac Newton and Leibniz with some stunning Midjourney images. All of these steps can be completed using Web 3.0 tools or derivatives based on robot innovation. The growth and success of robots will depend on electricity prices, so robots may actively trade in electricity futures markets to hedge their positions. They may have to trade with other robots and humans. Remember DAO (decentralized autonomous organization)? I haven’t seen a DAO operated by humans succeed on a large scale, perhaps because humans need more authority, or because DAO is just another hidden human authority disguised (for example, a person controls 51% of the vote). Robots have understood DAO and its points of failure, and they may try again. Meanwhile, robots will train themselves to learn how to operate their DAOs, and robot “companies” may eventually be more democratic than their human counterparts. Some robots may find it efficient to enjoy a limited liability version. Dealing with such a robot, you or your robot will stipulate that you cannot sue the robot for more than a specified amount. To hire a robot to perform more dangerous tasks, you and the robot may agree to a stricter liability standard. These “corporate laws”, if you will, will reflect many rapid innovations and methodological diversities. In comparison, the human system looks slower. Over time, perhaps we can learn from these robot experiments. I believe that robots can think of many other Web 3.0 applications – especially if we train them. Here’s a broader inspiration: Don’t easily discard a technological or institutional progress just because it’s hard to see what it might be useful for. Quantum mechanics existed for decades, looked like a fascinating spectacle, and then became one of the foundational principles of modern computing. Critics attacked games for corrupting young people, but now GPUs used for advanced games help build better AI, and AI computing company Nvidia is approaching a trillion-dollar company. Of course, while all of this is happening, we may call it Web 4.0. But Web 3.0 will eventually get the respect it deserves.

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