A.I. AND CRYPTO PLATFORMS
Two major events have occurred in Blockchain innovation history. The first was the creation of Bitcoin by Satoshi Nakamoto in 2008. This led to the rise to software that was able to resolve the double-spending problem traditionally linked with digital currencies by means of harnessing a probabilistic mathematical equation in the manufacture of bitcoins.
The second major event in Blockchain innovation took place in 2015 that was the creation of the Ethereum network, which allowed anyone to deploy a similar non-forgeable unit of currency or token without the requirement for building a Blockchain for each individual currency or token.
The way this worked was via redistributing computer power across the network and reusing the cost to support an additional layer of the Ethereum network on which digital tokens (as opposed to Blockchain coins) were supported.
PROBLEMS THAT AROSE FROM THESE EVENTS
This resulted in rampant market manipulation in the digital currency universe, with many Blockchain projects listing their tokens for a minimum of hefty $30,000 and upwards only to find that there is no liquidity in exchange for their currency.
In the event their currency might do well, most of the time the central server or the exchange operators they are on quickly crash the price at a point where they are financially incentivized to put profitability over their customers’ user experience.
A major part of the problem with these companies or bad actors becoming an increasing influence on digital currency markets has to do with the highly-centralized mining processes that dominate the new currency protocol. In the case of proof-of-work Blockchains, coin-age usually serves as a function of mining priority.
USE OF A.I. AS A SOLUTION
Specifically, an AI Blockchain would achieve the following:
i. It is market price-efficient. By a conducting a continuous scan of the exchange for price updated and volume order updates, the AI Blockchain can be synchronized its mining algorithm with the increase or decrease in the price of the token that is likely to occur over the short- and medium-term. This with time will make it a stronger source of purchasing power and would act as a more robust store of value than any digital asset today, where there is no correlation between currency inflation and market pricing, which results in sudden one-time spikes and erratic volatility versus steady, scalable value growth
ii. It rewards superior market behaviour. One of the crucial features of the AI Blockchain is that it could assess the behaviour of wallet holders and market makers and ascribe accounts (and by association strongly connected accounts) with individual weights which would determine how much of the newly minted coins a wallet holder has received. While doing this, it would look at factors such as how much liquidity that account has brought to the network, how aggressive the account or wallet holder was about trying to quickly profit in the event of an increase in the market price of the currency, to which accounts the account holder was connected with etc.
One of the key advantages of the Platform is that it is naturally able to incentivize market makers to position themselves on the Platform, operating either over the exchange or on an OTC basis. Data from the exchange and the wallets can be retrieved via a standard Block Explorer API and coins too can be mined from the Block Explorer in the way that they are for regular POS chains. The key difference that exists between this AI Blockchain and other Blockchains is that the running mining algorithm would be taken from an adjoining Oracle which would not be a decentralized software on a one-week minutely moving average basis.
Blockchain Magazine is an independent platform mainly focused on news and stories related to blockchain and other decentralized technologies. We are committed to deliver and present a reliable and true picture of blockchain framework.