Investments combining AI and blockchain

Source: Daoshuo Blockchain

In the comment area of ​​the article two days ago, a reader asked about my attitude and views on the various applications of AI combined with blockchain that have become popular recently. What.

The outbreak of AI is definitely a technological revolution comparable to or even exceeding the level of the Industrial Revolution. This revolution will surely sweep across all aspects of our lives, and combine with existing technologies to create scenarios and applications we can’t even imagine.

Any investor who is obsessed with technology investment and wants to participate in it cannot ignore AI.

Me too.

As a traveler exploring the crypto world, my first concern is of course the application of AI and blockchain. Not only have I been paying close attention to this for a long time, but I have also continued to think about some issues.

However, so far I have maintained a very cautious attitude towards this field and have not participated too much.

Because a reader asked, I simply took this opportunity to share my thoughts on some issues with you.

It should be noted that many of the questions I raise next do not have good answers for me yet, so I prefer readers to regard these ideas as suggestions rather than summaries of experience.

According to my usual habit, my first reaction before making any investment must be: before you expect victory, expect defeat first - that is to say, think through the worst-case scenario first, and if you don't Talk about how much money you can make, but try to take as few detours as possible.

When it comes to investing in AI combined with blockchain, the first thing that comes to my mind is: are there any pitfalls here that I should be careful about and avoid as much as possible.

1 The vast majority of existing projects are cannon fodder

I once wrote in a previous article: For a new thing that has just appeared, as long as everyone knows it at the beginning , there is a high probability that it will not be very good in the future, or that it will be good in the future, and the high probability of it being good is also a scenario that no one can imagine in advance.

The same is true for AI.

As soon as the application of AI comes online, everyone knows that it is good, and I think it is good, but I think its good points are most likely to be things that we can’t even imagine now.

Note that the "good" I say here refers to killer-level applications, projects that may increase a hundred times, a thousand times or even ten thousand times, rather than some small changes to our lives. Projects with slight improvements and slight innovations.

In my opinion, small applications such as translation, answer answering, and composition writing are just appetizers and not worth writing about.

Using this idea to measure the AI ​​combined blockchain projects we are seeing now, what does it mean?

It means that about 99% of the bunch of AI projects and AI coins we see in various exchanges and in the promotions of various big Vs are cannon fodder, and they are all on the road of AI combined with blockchain. stepping stone.

I want to explain to you here: When I say these projects are cannon fodder, I don’t mean that they don’t make money. Under the operation of a bunch of techniques such as hype, chasing the trend, market value management, etc., they are likely to make the holders make some or even a lot of money in the next bull market. However, most of these projects can be seen at a glance and can be solved in one minute. Let readers understand what they are doing, what problems they "solve", and where their "narrative" is.

For me, this kind of project does not arouse my further thinking and curiosity at all, and my interest in this kind of project has become less and less now.

2 A stone from another mountain can be used to conquer a jade

If most of the current projects combining AI with blockchain will be cannon fodder, then what is the killer application of AI combined with blockchain? Where is it?

I don’t know either.

But similar ways of thinking and historical evolution can be learned from.

The development of the encryption world is our best reference.

2.1 Technology has its own characteristics

I increasingly believe that any new technology has its inherent characteristics. The so-called characteristics are fundamental characteristics or characteristics and advantages that other technologies do not have.

The killer application of a new technology must be the application that maximizes its characteristics.

So the application of AI combined with blockchain must be an application that combines the characteristics of the two technologies.

The characteristic of blockchain technology is that it is as decentralized as possible.

This characteristic creates a neutral platform that can avoid being monopolized and controlled by any centralized force. Because it wants to avoid being monopolized and controlled by centralized forces, this kind of platform must attract global participants to participate in the maintenance of network security without any threshold. Since we want to attract global participants to maintain network security, we must reward participants who participate in network security maintenance - issuing encrypted assets.

It is based on this set of logic that Bitcoin and Ethereum were created, and today’s Inscription, DeFi, NFT, chain games, second-layer expansion, etc. are derived, which allows us to see countless The team’s creativity and inventions are amazing.

Will a platform controlled by a centralized organization allow us to boldly experiment and innovate unscrupulously?

Impossible.

So the entire logic derived from the characteristics of blockchain technology is connected and inseparable. If any of these links is cut off or castrated, the blockchain will lose its soul and characteristics, and degenerate into a traditional distributed system.

So what are the characteristics of AI? What does AI create that other existing technologies do not or cannot create?

This is a question I have been thinking about, but there is no answer.

2.2 Difficult Exploration in the Encrypted World

Now that we are looking at blockchain, it seems easier to understand its characteristics. But in fact this is a difficult process of exploration.

In the early days, most people suffered big losses and stumbled on their investment journey because they simply did not grasp this trait.

In the crypto world, the most typical case is EOS and a number of Ethereum killers. No matter what disguise they wear, their fundamental characteristics can be attributed to one thing: the pursuit of efficiency in blockchain transactions at the expense of decentralization or security.

Some people would say, didn’t those projects also create hundreds of times revenue during their peak period?

If we take a closer look at the situation that year, we will find that only very few holders of those tokens were able to cash out at the peak of the year, and the vast majority turned from bullish to bearish. We still hold a lot of chips in our hands and hope that these projects can come back to life and regain their glory.

However, the expected results turned out to be disastrous.

The only two kings, Bitcoin and Ethereum, can ride through the bulls and bears and never treat their holders badly. No matter what point investors hold them in the past (even the peak of the bull market), they will eventually gain something. All they need is some waiting and firm belief.

Why?

In my opinion, it is the decentralized nature that makes them stand forever.

The above example is within the encryption world, and there are many more outside the encryption world.

After 2018, a large number of traditional companies have developed many alliance chain projects, and they have also transformed the blockchain into a traditional distributed system at the expense of decentralization, and then claimed that this Class systems can transform our lives and even spawn new industries.

Some places have even proposed the concept of "coinless blockchain".

Now let’s look at it again. These projects are dead, and those that are surviving are just hanging on. Last year, a major manufacturer directly axed the so-called blockchain platform that it had vigorously built.

At that time, the alliance chain was an area that traditional investors particularly liked to invest in. We can imagine what investors who invested in those alliance chain projects will get now.

The above two types of cases: one is within the ecology and the other is outside the ecology, but the results are exactly the same.

Why?

Because those investors have completely gone in the wrong direction and have not grasped the characteristics of blockchain technology at all. Instead, they have been confused by some "pseudo-concepts".

So as an investor, you must grasp the characteristics of a technology and invest along the direction of its characteristic development, so as to avoid a lot of "pseudo concepts", "pseudo tracks", and "pseudo tracks". Innovation” and “pseudo-narrative”.

2.3 The confusion of “celebrity effect” in the investment field

After reading this, some readers may say that it seems that it is quite difficult to judge the characteristics of a new technology.

According to me, it is not only quite difficult, but also a narrow escape.

Let’s take the encryption world as an example.

When EOS emerged, its spiritual leader BM was a recognized technology expert in the industry, and his influence was no less than that of Vitalik back then.

When these two people speak out at the same time, how do we, as ordinary investors, judge?

Who is right? Who is wrong?

What did they say right and what did they say wrong?

This is a huge challenge for ordinary investors.

I was very lucky. On the one hand, I read Satoshi Nakamoto’s early remarks, and on the other hand, I met a mentor who thought deeply. Only then did I discover the loopholes in BM’s remarks and EOS. problems and avoided the pitfalls of these "killers" earlier.

What about outside the crypto world?

The situation is equally tragic.

At that time, there were many heavyweight technology people who were on the alliance chain platform.

As an ordinary investor, I heard the voices of two people at the same time: on one side was a heavyweight technology person, and on the other side was a fledgling entrepreneur (Vitalik) who dropped out of college.

No need to think about it, most investors will trust heavyweight technology people, and the results are self-evident.

I do not doubt the technical excellence of these technical people, but I do not believe that they truly understand the characteristics of blockchain technology. I even think that they are extremely resistant to this characteristic in their hearts.

3 Characteristics of AI

In order to explore the characteristics of blockchain technology in the encryption world, we have taken many detours and stepped on many pitfalls. Now in the field of AI, I find that a similar situation has occurred again.

We all know that the core of OpenAI technology is Transformer. But this core technology was not proposed by Microsoft but by Google.

But Google gave up this path for various reasons.

But Ultraman insisted that there was nothing wrong with this path. What was wrong was the lack of computing power. Therefore, he worked hard in the direction of strengthening computing power and achieved today's results.

Let’s think about it, if investors faced Google and Ultraman back then, how many people would think Ultraman was right? The results are self-evident.

What’s interesting is that a similar case happened again a few days ago.

Recently, OpenAI released Sora, which shocked the world.

When the whole world was prostrated by Sora, Yann LeCun, Meta’s CEO and Turing Award winner, criticized Sora.

This reminds me of the debate between Vitalik and BM.

Now that there is Ultraman on one side and equally top scientists on the other side, how do we, as ordinary investors, judge who is right and who is wrong?

I don’t know either.

If we don’t have clear answers to these questions, it proves that our understanding of the characteristics of AI is still very shallow. If we don’t know much about the characteristics of AI, how can we distinguish who is real and who is fake among a lot of “pseudo-concepts”, “pseudo-tracks”, “pseudo-innovations” and “pseudo-narratives”?

How can we capture projects with real long-term significance and in-depth value?

I still have a lot of puzzles and unknowns about AI and the combination of AI and blockchain, and I am still learning hard on this road. I hope that one day I can make some progress myself, and then I dare to carry out substantial large-scale layout and participation in this field.

In this field, not to mention investing in projects like Bitcoin and Ethereum, at least try to avoid investing in projects like Ethereum killers or alliance chains.

Now, most of the projects that combine AI and blockchain that I have seen are either short-term and quick to gain popularity, or they are most likely to be projects such as former "killers" or alliance chains.