There is only one thing better than new technology and that is two new technologies working together.
The Bitcoin revolution has led to us all becoming accustomed to the idea of blockchain – a complex computerised network which provides a foolproof method of encryption, with each block providing a check on its neighbour in the chain. Or, as the Bank of England terms it, “a technology that allows people who don’t know each other to trust a shared record of events”.
The concept of artificial intelligence (AI) is no longer just a concept and is fast becoming a reality, with medical, military and media applications now harnessing the capabilities of AI. In 2018, Wimbledon and its partner IBM edited player highlights by employing AI to analyse player emotions and reactions, crowd noise and match data, to produce video highlights of matches tailored to audiences.
Why blockchain and Artificial Intelligence?
Blockchains and AI are seen as perfect partners because AI is now being developed to produce algorithms capable of working with encrypted data – and which may in the future be utilised in assessing whether a financial transaction is fraudulent and should be flagged up and investigated as such, a job which currently takes man hours and the processing of large amounts of complex data.
Given how complex it can be to fully assess a financial transaction or investigate a suspected fraudulent transaction, harnessing the power and speed of AI to assess data encrypted in blockchains could revolutionise the handling and processing of data, due to the flexibility and adaptability of AI.
For AI and blockchain technology to work together, however, there has to be a degree of commercial and public acceptance and belief in the partnership.
New tech adoption rates
There is no doubt that adoption rates of new technology are faster than ever – especially when there is a financial and productivity advantage for business. The public, too, must also have confidence in technology which stores and handles their personal and financial data, as well as making assessments of that data, such as for the purpose of detecting fraud.
Transparency is often crucial in fostering confidence in new technology – and with blockchain and AI, this can be difficult, given the virtual nature of both.
Bitcoin has demonstrated, however, that those who are innovators or early adopters of technology often benefit from it the most. It is said that investors who bought $100 of Bitcoin at the start of the boom in 2010 and managed to hold onto it may now be worth around $73m, given the 0.003 cent price of Bitcoin in early 2010.
It may well be the same with utilising blockchain and AI – companies which are early adopters might well find they profit from the enhanced productivity and enhanced data sharing the partnership brings and profit accordingly, before blockchain and AI become the norm in commercial operations.
Nothing is without risk, however, but it is hoped that harnessing the capabilities of AI would reduce any existing risk such as fraud, given the speed and accuracy of the technology in processing large amounts of data – more data leads to improved models and more possibilities for secure data sharing or detecting anomalies in data stored in blockchains. Merging datasets can also create a new dataset, potentially with new business applications using AI.
Monitoring Artificial Intelligence
Bitcoin was also very much a word-of-mouth underground movement at the start – new innovations such as the mainstream use of blockchain and AI together are not likely to be viewed with such suspicion, especially given the cost effectiveness and efficiency of the tech. Enhanced data sharing can lead to innovation and efficiency across different spheres, from enhanced sharing of medical data to processing and checking supply chains to detect product failures.
There will have to be checks in place, however – even though blockchain in itself is a ledger system for storing and encrypting large amounts of data, the utilisation of AI in overseeing the use and security of that data or in detecting fraudulent activity must in itself be subject to scrutiny.
It has been suggested that the decisions made by AI be recorded to ensure transparency and accuracy in the use of AI in blockchain databanks, just as human decisions are logged and monitored. Whether AI will be self-policing remains to be seen, however.
Despite any initial reservations about the use of AI in monitoring encrypted data in blockchains, the adoption rate of technology over the last ten years suggests that the current generation will be susceptible to emerging tech, including unique partnerships in tech such as AI and blockchain.
As most people now have high-speed Internet access and a smartphone and are accustomed to new tech, it may be that advances in data protection and data sharing, such as AI and blockchain working together, will be a natural progression, provided there are adequate and transparent checks on the technology or built into the tech.