The Collision of AI and Blockchain Technology
Human beings are engineers. Our historical narrative is marked by our constant ability to control our environment through innovative strides known as technology. Typically, our most significant collective progress is linked with technologies that enhance our capacity to distribute information and foster trust. Consider the societal transformation that occurred after the invention of the printing press. It was not just about more books - the dissemination of knowledge it facilitated catalysed the Scientific Revolution, forever altering our understanding of the world. Similarly, the introduction of double-entry bookkeeping and the advent of joint stock ventures facilitated an unprecedented expansion of capital markets. Each of these innovations was a turning point, leading to a seismic shift in how we interact, learn, trade, and evolve.
Such breakthroughs are classified as General Purpose Technologies, technological advancements so impactful that they lay the groundwork for a multitude of further innovations across various sectors. These General Purpose Technologies act as a bedrock for society's progress, revolutionising the very fabric of our lives.
Today, we stand at the cusp of another such transformative period, facilitated by two concurrent General Purpose Technologies - Artificial Intelligence (AI) and Public Blockchain Infrastructure. AI has taken immense strides in the past few decades, opening up new frontiers in data analysis, automation, and predictive capabilities. At the same time, Public Blockchain Infrastructure has emerged as a trust-based mechanism, ensuring secure, decentralised, and transparent transactions.
The simultaneous rise of these two groundbreaking General Purpose Technologies is a phenomenon of unprecedented magnitude. Historically, the emergence of such impactful technologies has been staggered, the gap often spanning many decades, if not centuries. However, over the last century, the pace of technological innovation has been accelerating at an exponential rate. Today, the collision of AI and Blockchain is not just a coincidence of timing - it is a testament to the age of exponential change we are currently experiencing.
In this age, every day carries the potential for a new breakthrough. Every moment is a step forward in our relentless pursuit of progress.
The Big Picture on AI: A Workforce in Your Pocket
The advent of Artificial Intelligence (AI) marks a paradigm shift akin to the industrial revolution. Just as heavy machinery transformed manufacturing, AI is poised to revolutionise knowledge work. With its limitless potential for intelligent automation, AI is reframing the way we conceive and execute intellectual labour.
Today, anyone with an internet connection can tap into this new breed of highly skilled labour at an order of magnitude lower cost. AI eliminates geographic constraints, physical boundaries, and the traditional time sinks associated with traditional employment models. The promise of AI is the democratisation of expertise, making high-quality knowledge work accessible and affordable to all.
AI's capabilities extend beyond merely performing tasks; it is transforming the nature of decision-making itself. By processing and analysing vast amounts of data at speeds incomprehensible to the human mind, AI enables better, faster, and more accurate decisions. Its predictive capabilities allow us to anticipate trends and mitigate risks, empowering us to be proactive rather than reactive.
AI is not just a tool; it's a versatile workforce that can take on a diverse array of roles. It can serve as a strategist, software developer, marketing specialist, customer support representative, data analyst, and much more. Its applications are only limited by our imagination.
At Etherbridge, we embrace this vision of AI as a workforce in your pocket. This portable, accessible, and tireless workforce requires nothing more than an internet connection to be at your service. It never sleeps, never tires, and is continually learning, adapting, and improving. This is the power and promise of AI - a new era of knowledge work where intelligence is commoditised, decisions are optimised, and potential is maximised.
The Big Picture on Blockchain and Crypto: Building Trust with Math
In the realm of digital innovation, blockchain technology represents a paradigm shift in how we establish and scale trust among parties. While trust has traditionally been an intangible, delicate fabric held together by legal frameworks and recourse-deterring guarantees, blockchain replaces these complex constructs with a more straightforward and robust mathematical guarantee.
This transition from human-enforced guarantees to math-based ones offers scalability far beyond what we've seen in the past. By its very nature, blockchain technology has the capacity to handle an explosion in the volume and diversity of value transfers. We foresee a brave new world enabled by public blockchains, marked by the emergence of novel markets, innovative products, and transformative financial behaviours.
Our vision of this blockchain-enabled future rests on three fundamental pillars:
Democratisation of Access:
With blockchain technology, the only barrier to participation in a global financial network is an internet connection and a set of public and private keys. These cryptographic keys serve as unique identifiers, superseding traditional emails and passwords. Moreover, they enable individuals to truly own and manage online assets, paving the way for a new era of digital ownership.
Standardisation of Assets:
Blockchain introduces standardised representations of assets in the form of tokens, such as ERC-20 and ERC-721 tokens. These tokens streamline the movement of assets across various services available on public blockchains. They serve as versatile instruments, facilitating capital coordination, forging direct and powerful relationships between businesses and clients, and much more.
Transparent Business Logic:
Blockchain enables business logic to be embodied in smart contracts, which offer unprecedented transparency and efficiency to end users. These smart contracts aren't just transparent; they're also highly composable, meaning they can be layered over one another to create increasingly complex applications. This composability empowers entrepreneurs to leverage each other's business logic, fostering a new ecosystem of cooperative innovation.
The revolution ignited by blockchain and crypto technologies goes beyond mere digital transactions; it's an evolution of trust, a leap from human-enforced guarantees to mathematically-enforced certainty. This transformation has the potential to unleash untapped possibilities, laying the foundation for a world where transparency, ownership, and efficiency are the norm rather than the exception.
A Primer on Large Language Models (LLM) and AI: Chatting with a Parrot
So, what are AI and LLM’s? Think of it like a really smart parrot, and we'll call this parrot ChatGPT. Just like a parrot, ChatGPT listens and learns from people talking to it. If you say "Hello," the parrot learns to say "Hello" back. But unlike a normal parrot, ChatGPT is a super-parrot! It can learn not just words but phrases, ideas, and even whole conversations. Over time, this parrot becomes really good at understanding what you're saying and responding in a way that makes sense.
But here's the tricky part – training this parrot. You see, just like teaching a parrot to speak needs time, patience, and a lot of repetition, training ChatGPT needs a lot of processing power. This is where something called GPUs comes in. Think of them like super-fast brains that help ChatGPT learn and remember things quickly.
But it's not just about speed; the parrot also needs feedback from humans. When the parrot gets something right, it gets a pat on the back (or a treat, if you will). When it gets something wrong, it's shown the correct way. Over time, with the help of its super-fast GPU brain and human trainers, our parrot ChatGPT gets better and better at understanding and responding to conversations.
And that's AI and LLMs for you - like a super-smart parrot, learning from us, understanding us, and helping us communicate better. Who knew talking to a parrot could be this exciting?
The Intersection Between AI and Crypto:
As we navigate the digital revolution, AI and Crypto, two powerful General Purpose Technologies (GPTs), are converging. The hype around AI isn't unfounded; it has delivered on its promise; ChatGPT and Large Language Models are the fastest-growing product the world has ever seen. In this section, we'll explore the reasonable potential use cases stemming from this intriguing intersection.
A Marketplace for Processing Power:
The quality of AI output is directly proportional to the amount of processing power it can utilise. Essentially, the more computations an AI can perform, the better its output and training. This opens up a unique use case - creating a marketplace for processing power and GPUs. Blockchain technology and smart contracts facilitate this by allowing individuals worldwide to rent their excess GPUs or processing power to entities needing to train AI models. Over time, this free market for processing power could potentially yield lower market fees than current centralised cloud service providers.
Reinforcement Learning and Human Feedback (RLHF) Incentivization:
Token mechanisms could incentivise participation in RLHF, enhancing AI models' accuracy. We envision a future marketplace where individuals are compensated for providing valuable feedback to AI models. Specialists could leverage their expertise to refine AI models in their respective fields. Tokens would provide the necessary incentive for RLHF to operate at scale.
Authentication and Verification:
The rise of AI capabilities necessitates a robust system to authenticate human-performed work. This is particularly important in our fight against deep fakes and potential misinformation or misrepresentation. Cryptography, using public and private keys, could play a significant role in this verification process. These public keys would most likely need to be linked to verified identities stored on a public blockchain, ensuring transparency and accountability.
Smart AI Agents:
While this scenario may seem far-fetched, let your imagination run wild for a moment. Imagine smart AI agents transacting on public blockchains, serving as personal financial assistants, monitoring markets, and adjusting risks. They could collect NFTs, exploit market inefficiencies, or perform a plethora of tasks. In a world where everyone could potentially have a collection of smart agents using smart money, the possibilities are endless and unforecastable.
The convergence of AI and crypto holds immense potential. By creating a synergetic environment, we can unlock innovations that redefine boundaries, fuel growth, and shape the future of digital transformation.
Reflecting on these potential intersections between AI and crypto, it's essential to clarify that we at Etherbridge haven't yet made any investments in this theme. While we recognise the transformative potential that lies in the amalgamation of these technologies, we haven't identified any compelling opportunities in the market that align with our investment principles and goals.
Observing market trends, it's clear that AI tokens have significantly outperformed the market and other sectors.

We recommend keeping a keen eye on this developing trend; however, it's important to distinguish between long-term investments and tactical allocation trading opportunities. Currently, we perceive this theme more as the latter. Until we uncover compelling use cases that showcase a tangible synergy between AI and blockchain, our approach towards this theme remains primarily focused on trading, not long-term investment.
Moreover, while the future promises exciting developments, it's vital to note that blockchain technology still has substantial strides to make, particularly regarding scalability. To truly deliver on all the potential use cases we've discussed, blockchain must continue to evolve and enhance its capacity to handle large-scale operations. As the technology matures, we anticipate a landscape teeming with opportunities at the intersection of AI and crypto. Until then, we remain watchful and optimistic.
How Etherbridge is Harnessing AI: Driving Efficiency and Enhancing Understanding
At Etherbridge, AI isn't just a buzzword; it's an integral part of our daily operations, transforming the way we work, learn, and grow. We'd like to share with you some of the ways we're currently leveraging AI to bring our vision to life.
Streamlining Research and Analysis:
A significant portion of our time – almost 90% - is dedicated to reading, researching, and analysing diverse blockchain investment opportunities. Finding single, reliable sources offering accurate, comparable qualitative information on various projects is challenging. To address this, we've harnessed the power of AI tools to enhance our efficiency significantly. We use AI to analyse resources on a specific project or theme, asking standardised questions to extract and compile valuable information. The result? A library of comparable, qualitative factors aiding our asset selection decisions.
Aiding Coding and Data Analysis:
We predominantly use R for data science tasks. By integrating AI tools and plugins, we've managed to write code ten times faster and debug in a fraction of the time it would usually take. This not only boosts productivity but also expands our ability to perform solid, quantitative analyses on various factors.
Simplifying Complex Topics:
AI, specifically ChatGPT, has been a game-changer in distilling complex topics into easily comprehensible content. When we encounter a challenging topic, we turn to ChatGPT. It helps us understand the subject at three different levels - beginner, intermediate, and PhD levels. This innovative approach saves us significant time on research while ensuring we gain a solid, meaningful understanding of complex topics.
At Etherbridge, we're committed to staying at the forefront of innovation. As we continue to weave AI into our operations, we're excited to unlock new possibilities and push the boundaries of what's possible in the realm of blockchain and crypto investment.
Leverage for Entrepreneurs: The Dawn of a New Age
It's no secret that our world is gripped by a tidal wave of weekend worries. Debates and anxieties around Covid, financial markets, the threats of AI, mounting national debts, Central Bank Digital Currencies (CBDCs), climate change, and political polarisation, to name a few, dominate our conversations. But amidst this tumult, it's crucial that we zoom out and view the bigger picture.
Today, entrepreneurs, the engineers of our collective future, have access to tools and leverage that even the kings and queens of the past could only dream of. The convergence of AI and blockchain technology has ushered in an era where ideas can be transformed into reality with unprecedented ease and scale.
This is the age of the entrepreneur, a time when dreams have never been closer to fruition. The advent of AI and blockchain empowers you to leverage intelligent machines and sophisticated coordination mechanisms to bring your ideas to life. With blockchain and tokenisation, you can rally capital around your vision, while AI provides a tireless, efficient workforce that learns, adapts, and excels.
Instead of succumbing to weekend worries, let's adopt a perspective of gratitude and optimism. Look at how far we've come: the progress we've made in technology, the obstacles we've overcome, and the innovations we've developed. This isn't a time for despair but for hope and excitement.
As entrepreneurs, the stage is set for us to write about the future. With AI and blockchain at our disposal, the sky is truly the limit. So, let's leave the worries behind and embrace the extraordinary opportunities ahead. It's time for optimism.
Whilst we all have the option to look, to seek to understand, it’s often easier not to. Bitcoin, Ethereum and distributed ledger technology are complex systems that require significant due diligence. At Etherbridge, we aim to lower the barriers to understanding this fast-growing digital economy.
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This is not financial advice. All opinions expressed here are our own. We encourage investors to do their own research before making any investments.