When it comes to the digital world, everything has value. This might seem like an absurd statement on the surface. How can a dopey picture taken at a park have value?
This is part of what we will cover in this article.
We are rapidly heading towards the AI Atlantis. To many, this will be a tsunami, something that bowls over them. A lot are opting to put their heads in the sand, mimicking Schultzie from the old television program Hogan's Heroes.
For those who are prepared, huge opportunities await. AI is moving us into a new form of computing. No longer are we simply pulling information from files, albeit with massive efficiency. Instead, we are actually replicating human cognition. The days of "if-then" statements are going away.
Over the past couple years, we theorized what type of value we are looking at. Of course, we are not alone. The entire financial and technological world is attempting the same thing.
OpenAi is moving towards another funding round, one that will put the company at a $340 billion valuation.
Bubble? Maybe. Or perhaps the potential for value generation is so astounding that knowledgable technology investors see the path we are likely heading down.
So while the financial people fret about bubbles, valuations, and P/E ratios, the technology folks are diving in completely.
This is something all of us involved in Web 3.0 shoudl pay attention to.
Image generated by Ideogram
Crypto: Capturing The Value Of Everything
I often discuss the idea of Big Tech versus the rest of us. Anyone who reads my articles knows I feel the future of AI has to be open source, both for models and data. It is one thing to open up the weights yet if startups do not have access to data, it is problematic.
This also does not mean that I suggest jumping on board any AI token. While these can be great to trade, odds are very little is happening with them. This is in contrast to projects like Intelligent Internet and the Gaia Network. These focus specifically on creating open source AI networks, addressing the many layer of the stack.
The idea is to commoditize as much as possible, benefiting the majority instead of just a few. Of course, to achieve this end, people need to do their part. In my view, it starts with the reduction of the data we provide to Big Tech.
If this is done, crypto can step in as the force multiplier that is associated with AI.
Everything Has Value
This is the central premise of the online world. Soon we might see this expand into the physical realm. For now, we will simply focus upon the implications of the digital sphere.
It might seem absurd that each action, especially on social media, is valuable. We know there is a lot of garbage posted. We see the ridiculous pictures that end up on Instragram or X. A lot of YouTube videos are nonsense.
How can they be of value?
To humans, there might not be much. However, to computers, they are like water.
On digital platforms, the hovering over a post or video is of value. With YouTube, as an example, you do not need to play a video to have similar ones recommended. Clicks are even more valuable as it then allows the platform to determine how much time you spend on said video.
This is, in part, how recommend engines operate. We see this with Netflix, Spotify, and other platforms that feed us more information.
The feeder system leads right into AI. We are starting to see how this is applicable with both human and synthetic data. Combine this with multimodal training, which uses images and video, and we can see how even the goofy cat shot is valuable.
The AI Tsunami And Crypto
As stated, most crypto falls into the category of "value capture token". It is not really a medium of exchange as much as stake in the value of the underlying asset. This can be the network such as Ethereum or Hive or an application such as a DEX (UNI).
We are going to see massive leaps in data. The output generated by a ChatGPT due to the prompting by hundreds of millions of users is astounding. Of course, I would be remiss not to point out this data is closed, available to nobody but OpenAI.
If we are moving towards another economic singularity, do you want to participate?
Here is where cryptoc-assets enter the equation.
The goal should be to tokenize AI infrastructure, effectively making it public. companies such as xAI, Meta, and Google could still produce their models, which are rapidly becoming commodities. The utility associated with each model will vary as they start to branch out.
This will be followed up by "expert" models. The segregation of data will means that models for law, medical, and finance appear. These will be specially trained, becoming the expert model for that particular field.
It is at this point that people can own a piece of the legal model, through the token. Going back to the original premise of everything has value, that means anything that happens in the legal world that is fed into the model would equate in a similar rise in the token.
Rinse and repeat.
Consider the impact when this is done across the entire spectrum of businesses or interests. For example, there could be a model that is the expert on classic cars.
It Is A World Of tokens
Many first encountered tokens with the entry into crypto. This is, however, something that programmers and data scientist learned about long ago.
Since a token is a quantifier for data, we are embarking upon an interesting economic basis.
Tokens in equals tokens out. This does not apply exclusively to crypto.
When data is input, it equates to output. We see this with a prompt on a chatbot. Copy/paste an article in along with the reequest for a summary and output is generated. The quantity of that is in tokens.
Of course, as more tokens are generated on a network (or applications), this increase the value. This is captured in the crypto-asset that is related to it.
Basically, this was the business model which Big Tech companies utilized for decades. It is the core of trillions of dollars in market cap.
Crypto is a new way of capturing said value. To achieve it, we simply need to input more tokens.
Again, everything has value...and crypto captures it all.