For nearly two years, high-profile investors such as Cathie Wood of Ark Invest have been talking about the rapid convergence of artificial intelligence (AI) and crypto. Yet, to date, a single must-buy AI crypto has not yet emerged.
Sure, there have been some good candidates along the way, including Render, Bittensor, and Artificial Superintelligence Alliance. But all of them have since fallen by the wayside, and are now trading for much less than their all-time highs.
But there might be a top AI crypto hiding in plain sight. Yes, I'm talking about Ethereum (ETH 0.46%), the world's second-largest cryptocurrency.
Can Ethereum lead the way in AI?
Two years ago, Ethereum founder Vitalik Buterin ruminated on the possible uses of the Ethereum blockchain for artificial intelligence. This was in the early days of ChatGPT and the generative AI boom.
Image source: Getty Images.
Now, he's back with a new set of predictions about Ethereum and AI. As he sees it, blockchain technology is still a perfect fit for AI, given its speed, scale, and decentralized nature. At a minimum, Ethereum could act as an economic base layer for AI. But think really big, and Ethereum could reshape the future of AI.
CRYPTO: ETH
Key Data Points
As Buterin sees it, Ethereum could help to develop new tools to interact with powerful AI models, without the need for a centralized IT provider (i.e., a Silicon Valley tech giant). And Ethereum could also help to provide innovative ways for AI agents to meet, coordinate, and pay each other for services rendered.
In a best-case scenario for Ethereum investors, this new surge of AI activity could rapidly increase the value of Ethereum. Just as Ethereum led the way with decentralized finance (DeFi) due to its pioneering of blockchain smart contracts, it can now lead the way with AI. If that's the case, Ethereum could be ridiculously undervalued at a price of just $2,000.
Is this AI vision for Ethereum realistic?
However, this vision might be too idealistic and, well, economically unworkable. As Buterin sees it, blockchain technology should help to improve the functioning of markets and governments, while also empowering individuals.
If that happens, it will lead to a best-case scenario that he refers to as "cypherpunk mountain man vision with local LLMs" -- a world in which rugged individuals living at the top of a mountain are still plugged into the blockchain and powerful AI models.
But how, exactly, do you monetize that? If you've been following the drama around OpenAI and its endless plans to monetize AI, then you know that idealism and AI development don't necessarily go hand in hand. At some point, you need to start selling ads or charging for products for it to be a real business.
AI projects on Ethereum
Nevbertheless, DappRadar has compiled a comprehensive listing of the popular AI projects taking root on Ethereum right now. These include ChainGPT, Assemble AI, and Virtuals Protocol. Any of these, in theory, could become the "killer app" helping to power the AI future for Ethereum.
The convergence of AI and crypto is a trend worth watching, and Ethereum is one crypto on my radar right now. It may be too early to call it an AI crypto, but it will likely have a much brighter future than any of the one-hit wonders of the past two years.
