Blockchain and Artificial Intelligence are two of the trending technologies often heard in the techno-town. Several industries are implementing these technologies at various levels in their organization to reap benefits like automated and trusted systems, higher efficiency, reduction in time, and more.
Let us understand how Artificial Intelligence and Blockchain technology can influence the disruption across various industry verticals.
Artificial Intelligence (AI) technology is bringing a paradigm shift in the business by mimicking human intelligence to perform tasks. It is expected that 40% of digital transformation will be done through AI and AI-enabled voice assistants will hit 4 billion devices by this year-end. The studies show that the global market for AI will be $190 billion by 2025.
The upsurge in the use of AI is attributed to its key features like personalization, better data management, automation, reduction in errors, data mining, real-time assistance, prediction, and so forth.
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In simple terms, blockchain refers to a distributed ledger that stores transactions in nodes securely. As the transactions are immutable, tamper-proof, transparent, and eliminates the need for a middleman, the technology has disrupted the business world in several ways.
IDC predicts that $11.7 billion would be spent on blockchain technology by the year 2022 showing a compounding annual growth of 73.2%. Many banks and finance firms across the globe are adopting blockchain at a faster rate, and expect to save around 8–12 billion dollars annually.
The disruptive features of blockchain causing its massive adoption includes decentralized database, distributed ledger, immutability, data protection, transparency, and security.
Artificial Intelligence and Blockchain
Though Artificial Intelligence and Blockchain involves technical complexity, the joint use of these two technologies may alter the business paradigm significantly that business leaders can look forward to improvement in their business. Some of the applications would be marketing, investment management platform, smart computing power, data protection, data monetization, crowd sourced predictive models for Hedge funds, and more.
AI and blockchain are together creating a buzz, because of their shared features. They share several characteristic features that enable a seamless interaction soon.
Three of them are elaborated here.
A decentralized database refers to data sharing between multiple clients and AI relies on big data for predictive analysis and algorithms are more reliable.
High-value transactions occur on the blockchain with high security. Likewise, the autonomous nature of AI machines depends on high security to prevent catastrophic occurrences.
Machine to machine communication is trustworthy and so they execute transactions on the blockchain.
Let us investigate how blockchain engineers are integrating the technology together.
Blockchain Technology Transforms Artificial Intelligence
Integrating the blockchain with AI needs expertise in both domains. A blockchain certification apart from being an expert in AI enables the professional to utilize both the technology to realize the real benefits.
AI algorithms help to detect frauds and risks associated with any transaction, while blockchain enhances the data accuracy used to predict frauds through secure data auditing process.
With these unique features, we can construct a hybrid decentralized AI. It means running the AI algorithms privately on the cloud and the data should be from blockchain-based decentralized data.
👉Secured personalized experiences
Research studies depict that 49% of the companies will adopt digital business transformation strategy to enhance customer experience.
AI serves customers by working with highly-sensitive personal data and provides them with an adept personalized experience. Blockchain ensures immutability and security using encryption techniques. In brief, blockchain offers security while AI enhances privacy to the end-users.
The implementation of crypto loyalty programs, hybrid AI for customer engagement, and customer identity for business transaction can improve business process, optimize customer retention, and grow business 10x faster.
Merging of two technologies boosts public trust as it enables them to audit every single step of their transaction and decision-making process. The user’s data can be stored, managed, and employed with required security and privacy.
When blockchain is applied in conjunction with AI, the users will get transparent records to understand the system’s process. This will increase machine to machine interaction and facilitate data sharing for coordinated decisions.
👉Improved smart contract
The smart contract has benefits like higher speed, enhanced data storage, and minimal to zero disputes. When AI gets integrated with blockchain, smart contracts can encode and validate commercial and complex business relationships.
Blockchain-enabled smart contracts can exchange value without third-party intervention. The combination of AI, cryptography, and distributed trust algorithms may lead to a secure and efficient way of exchanging products and services.
👉Novel business models
The frictionless access to the information owing to immutable data enables AI to deliver factually accurate decisions and newer business models. AI can restructure business operations, encourage market development, and improve regulatory effectiveness.
A final note
The integration of these technologies is in its nascent and experimental phase only.
“There is a lot of hype and a lot of purported excitement around these terms. Believe us, because we see it every day, warns Emerj CEO Dan Faggella.
We have to wait to understand what opportunities these technologies can bring in reality and how we embrace them. But the days are not so far.
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Integrating Blockchain Technology with Artificial Intelligence was originally published in Cryptocurrency Hub on Medium, where people are continuing the conversation by highlighting and responding to this story.