Blockchain and artificial intelligence (AI) hold the promise to upend business operations across all industries in ways not seen before. But experts believe that the real potential has not been seen at all. More value and business benefits can be harnessed from both technologies with a strong integration framework. This fusion can enable enterprises in creating composable business solutions and delivering services faster.
AI and Blockchain: Integration for a Better Future
Blockchain is an ingenious innovation. It is an immutable ledger that is decentralised and open, with strong controls for data encryption and privacy controls. Trusted computing, smart contracts, and proof of work/stake are some of the features that defy conventional centralised transactions and make blockchain technology transformative. The parties to a contract use blocks to store information. New blocks are added to create more information. Each block holds a unique “hash” of the previous block. Cryptography via hash ensures secure transactions at authentication source, eliminating the need for a central intermediary. Miners use the computational force to hash potential blockchain blocks. Changing the hash of one block automatically changes the hash of all previous blocks. It is nearly impossible to change the hash encryption by working backwards. A network of nodes verifies that transactions entered as per consensus algorithm are valid. All these features make Blockchain a distributed consensus algorithm that is encrypted at all ends.
AI, on the other hand, is an umbrella term for different subsets of technologies, i.e., speech-pattern recognition, self-driving cars, etc., allowing machines to harness extracted knowledge and take over work that would have needed a human to complete. By leveraging AI-based technologies, organisations are improving patient outcomes, automating manufacturing processes, and even studying black holes.
However, both technologies suffer from their own set of weaknesses and complexity. A lot of developer support is required for setting up and maintaining a blockchain architecture. Therefore, blockchain architecture is susceptible to code errors and bugs. Also, the mining process is infamous for consuming a lot of energy. In the same way, enterprises face dilemmas while managing AI data on a large scale. With blockchain and AI integration, organisations can solve many of these unsolvable problems and execute business transactions with institutional knowledge.
Integrating AI and blockchain technologies can help enterprises realise growth over the next quarter century and beyond. AI can be decentralised and made open using blockchain. And blockchain can get the intelligence to break down silos and analyse data in a better way.
The Long-term Benefits of Fusing AI and Blockchain
Enterprises can reach many business benefits downstream by synthesising AI with blockchain. Technological behemoths like Amazon, Facebook, LinkedIn, etc. can build a decentralised model for AI. Enterprises, which deal with a colossal amount of data can extract meaningful insights from their data and improve their services through a peer-to-peer connection.
Porsche, in collaboration with XAIN AG, is already testing blockchain and AI applications in its smart vehicles. JD.Com, a leader in AI-based applications, is using this combination to build decentralised business intelligence applications. Such applications can expose data with better management and encryption and reduce incidents dramatically. Here are some benefits of the blockchain and AI fusion drive:
Decentralised Intelligence: Enterprises can set up a future-ready blockchain architecture that enables a combination of AI algorithms. A peer-to-peer connection can be streamlined with image recognition, natural language processing, and multidimensional data transformations in real time. It will empower business users to break down large-scale systems with a combination of nodes and set up microeconomic environments that will cover specific customer needs.
An AI-powered blockchain can be scaled as per the number of users. The transaction data in blocks can be optimised and made faster. On top of that, blockchain’s resilience can be further improved with computational intelligence and attack-defence mechanisms.
Flexible AI: Many great advancements in AI have taken place, but they are mostly narrow. They do not support the vision of setting up an artificial general intelligence (AGI) framework which is available to everyone. The blockchain model can provide a distributed paradigm for enabling AGI. Enterprises can develop long-range services with blockchain nodes that can be safely delivered to wider groups. Distributed and cost-effective AI services can be developed via specific events and made available through smart contracts.
Data lineage maintained by blocks will help enterprises in preparing data for specific machine decision processes and in setting up better models. Smart contracts will help users in only changing that part of data which they are entitled to. Easy, secure, and wider data access will allow small players to leapfrog bigger players and set up robust service delivery models.
Energy and Cost Efficient IT Architecture: Deloitte’s 2016 report estimates that the cost of validating transactions on blockchain stands at a whopping $600m per year. A fair share of this cost is generated by specialised computer components which consume a lot of energy while executing mining operations. An AI led blockchain model can help enterprises in setting up a lower energy consumption model. It can allow specific nodes to perform big tasks first and alert miners to stop less important transactions. Without structural changes in the architecture, enterprises can achieve the latency needed for executing transactions faster.
The potential benefits of AI and blockchain integration are infinite. With both technologies in combination, validating transactions, finding illegitimate papers, and managing databases will become fast and smooth. However, the path to integration will not be easy. There will be several nodes, algorithms, and protocols that will require an intelligent mesh from start-to-end. This will help in factoring the AI and blockchain capabilities into the core processes and achieving lasting success for businesses from their investment.