As the crypto industry attracts more users, developers are laser-focused on improving user experience, a major pain point for most new users. Artificial Intelligence has often been seen as a technology that could improve how people use and interact with crypto. In the latest episode of Hashing It Out, the integration of AI with crypto is discussed at length.
CoinStreetDaily’s Elisha Owusu Akyaw (GhCryptoGuy) interviewed Nansen CEO Alex Svanevik about the importance of on-chain data and the use of artificial intelligence in crypto in Episode 8 of Hashing It Out.
The narrative that artificial intelligence is taking over has intensified with the popularity of OpenAI and applications like ChatGPT. The trend has also extended into the crypto industry, which has witnessed a price surge in tokens associated with AI-related crypto projects. Svanevik is certain that AI will be integrated into cryptocurrency applications in a way that will significantly improve user experience.
He explained that similar to Bing integrating ChatGPT, several crypto on-chain data platforms will use AI to help users find information more easily. According to the Nansen CEO, most of the results that platforms show users currently require substantial work, which can be changed to human-readable content with artificial intelligence.
After several cryptocurrency platforms went bankrupt in 2022, institutions adopted a new standard called “proof of reserve” to provide transparency for their end users, which has sparked debates. Svanevik believes that proof of reserves, or reserve transparency, is useful. However, he doesn’t think it’s enough unless they also show what he terms “proof of solvency,” which can be done through a combination of proof of reserves and proof of liabilities.
Nevertheless, Svanevik argued that the popular conclusion on Twitter that proof of reserves is useless because one can’t confirm solvency is wrong, as many of last year’s collapses could have been avoided if users had more information on how the exchanges and lending platforms were managing deposits through on-chain data. Moreover, he added that regulators would be more efficient if they closely watched on-chain data.
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On the outlook for 2023, Svanevik mentioned that despite an uptick in volumes in sectors like nonfungible tokens (NFTs) between December 2022 and early 2023, the new year would be challenging for many crypto startups that raised money recently and are beginning to run out of capital.
In this episode, the two also discussed:
- Data on the trajectory of the NFT market in 2023
- Ethereum layer-2 competition
- Web3 gaming
- The popularity of on-chain data in the crypto industry
Listen to the full episode on Spotify, Apple Podcasts, Google Podcasts, or TuneIn to get all the insights on crypto and AI. You can also check out CoinStreetDaily’s catalog of shows on the new CoinStreetDaily Podcasts page.