Why is AI better than crypto?

May 22, 2023 Creatix.one, augmented intelligence for everyone.

Is AI the new crypto? No. AI is the third phase of the computer era. Unlike crypto, the success of AI does not depend on the collapse of the current world order. Note that crypto pretends to be an alternative to the fiat monetary system controlled by sovereign states and banks. AI is nothing other than computer power. AI will simply continue the computerization of human society. Therefore, it is easy and reasonable to predict that AI will continue growing and expanding in the decades to come. That does not mean that all AI projects will be profitable or successful. In fact, chances are that most AI ventures will fail. Yet the AI industry segment as a whole will thrive.  

Bubblicious 

The current hype around everything AI may resemble the hoopla that crypto generated a few years ago. Ten thousand dollars ($10k) "invested" (gambled?) in Bitcoin in November 2015 would have grown to $1.8M by November 2021. By now, when Bitcoin has supposedly "failed", the same $10k investment would still be worth about $800k. No one really knows if Bitcoin will totally fail like so many other crypto projects, or if it will become the permanent "asset class" that it pretends to be. Anyone holding paper profits on Bitcoin or any other crypto should consider taking some profit, and holding the rest forever just in case. The most you can lose is 100% of your investment. However, there is no upper limit on how much you could earn from an investment.  

Regarding AI, a big bubble and burst cycle cannot be ruled out. For sure, fortunes will be made (and lost) in the AI gold rush that will capture financial and business headlines in the next 25 years. Despite having been around for over 70 years as an aspirational goal of machines that can think like humans, AI is very much still in its toddler years. AI will continue growing in the next decades, and will gradually expand into all industries and segments of human society. AI will expand into everything because the market need for intelligence (be it biological, artificial, or both) is unlimited. So long as there is life, there will be an endless supply of problems and an endless demand for problem solving ability (i.e. intelligence).  

An AI bubble is foreseeable and likely in the coming years. AI will achieve outstanding, seemingly miraculous, results. Investors will flock blindly into speculative, high-risk, AI ventures just like in the dot com bubble days, and probably worse. There will be massive winners, followed eventually by colossal losers. It is not unconceivable that an AI bubble may grow so big and fast that its burst may cause a market collapse unseen since the Great Depression. To avoid such a massive crash, the hope is that AI develops slowly and steadily. We'll see what happens. We'll see what future scenarios we (investors and market participants) create in the future. 

Winners and Losers

There will be winners and losers in AI like always. $10k invested in Apple in the early 2000s would be worth about $6M today. On the other hand, investments in Compaq, which was touted as a better investment, would have failed. Likewise, investing in Google faired much better than investing in America Online (AOL), which pundits favored over Google. 

Most ventures fail. Most AI ventures will fail. However, some will succeed and deliver amazing results. It is impossible to know with certainty which AI investments will pay off, and which will fail. When investing in AI, or in anything else, research and diversification are key.   

Most AI ventures will fail like most crypto "coins" have failed. That is how business works. That is how nature works for that matter. Most ventures, both in business and in nature, fail. However, inevitably, through persistent trial and error plus luck, some ventures succeed. Oftentimes, if not all the time, it is impossible to predict who will succeed. For sure, dinosaurs did not see little human primates conquering the world.

AI is not crypto. 

Crypto's "kryptonite" is that its conceptual success depends to a large extent on the failure of the current monetary system. Crypto seeks to upend the fiat currencies that sovereign states issue, and that banks manage to keep the world economy running. Those in power and who benefit from the current fiat system model (politicians, bankers, and all of us to some extent) will not back up a crypto overhaul of the system unless there is a massive crisis (e.g. WWIII, a meteoric strike, a super pandemic, etc).  If the system were to collapse on its own due to an extraordinary world event or a set of events, crypto may have a chance. Crypto is thus a hedge bet against the current monetary system and world order. 

Crypto's success depends on the failure of the current fiat currency monetary system. So long as the current world order remains in place, and fiat currencies rule the world, crypto has little chances of becoming the real asset class that it pretends to be. In the meantime, crypto will remain a quasi-scam speculative side show. 

AI is a different story. AI is simply the continuation of the computerization of human society. AI is produced by super computers connected to the internet and programmed to learn by "feeding" themselves all data available online. These computers and their new neural networks can process algorithms to identify patterns buried in big data. Computers can also be programmed to run forward looking simulations that operate as predictions of future scenarios. Moreover, computers can be programmed to continue learning and training by continuously expanding their database and seeking the "rewards" programmed in the algorithms. 

AI technology is here to stay. 

AI is the third phase of the computer era. The first phase was the development of stand-alone computational machines. The second phase was the interconnection of those machines (computers) in a global web called the "internet". The third phase is the interconnection of smart (deep learning) computers and programs producing AI. 

AI will only get better and more impressive each year. You can bet with high level of confidence and mathematical certainty that AI will continue expanding into every single field of human endeavor. Bookmark this page. Wherever there is a human pursuit, AI will be there improving the process casting light and illuminating the way. 

AI is the biggest opportunity (financial, entrepreneurial, technological, scientific, etc) available today. AI is today what early computers were half a century ago. AI is what the internet was a quarter of a century ago. AI will completely revolutionize human society in the next quarter of a century. Bookmark this page and come back to it 25 years from now. This is the time to invest time and energy learning as much as you can about AI. Regardless of how you fared in the first two phases of the computer era (stand-alone computers, and the internet), AI is the third phase that you do not want to miss. 

Stay tuned to Creatix.one, augmented intelligence for everyone.