AI and crypto, and a matter of magic
While one will, like the internet or smartphones, become everyday and ho-hum, the other will continue to blindside and surprise humanity.
In 1962, the great science fiction Arthur C Clarke wrote a book of essays called Profiles of the Future, in which he coined the now much-quoted, “Any sufficiently advanced technology is indistinguishable from magic”. Perhaps he should have added a rider; it is indistinguishable from magic when it first appears, then the magic inevitably fades.
There have been a couple of these in the last half-century. The PC. The Internet. GPS. Smartphones. All of them now a little ho-hum. They are part of the fabric of our lives; most people who use them don’t know how they work, where they came from, what ingenuity was required to invent them. Same could be said of our fridges or cars or TVs. As long as they work, we’re happy.
Two new technologies are blooming now, even though they have been blossoming for decades. Both are magical. I think that one will follow a well-trodden path into background ubiquity and the other will not.
I am talking about crypto and artificial intelligence (AI).
The former will permanently change the way we understand, implement and secure ownership. Not just in the digital realm. And very far from the hue and cry of cryptocurrency markets, which have tragically blurred the importance of this technology in the public eye.
And the latter, AI? That’s a different kettle of fish. That one is going to fizz and pop for a long time. Its magic will fade slowly, or not at all.
From zero to $16-trillion
So. Crypto. I have written previously about a fuse that has been lit in a quiet corner of crypto called real-world tokenisation, which will entirely rewrite the way capital is deployed in real-world projects and business. Both McKinsey and BCG estimate that this sector will rocket from essentially zero to more than $16-trillion by 2030, which would make it the fastest-growing new-technology-driven sector in history, by a long shot. It has nothing to do with cryptocurrency and art NFTs, which is only a subset of the crypto world that has so grabbed public and regulators’ attention.
So, what is the magic here? It lies in mathematical oddity called the one-way function, which was scrutinised and dissected by a bunch of very smart mathematicians in the middle part of the 1970s and which resulted in a form of cryptography that has enabled what is referred to as digital signatures.
Details aside, the use of cryptography to create non-counterfeitable digital signatures has enabled the entire substrate of blockchain, which in turn has allowed trade and interaction between anonymous parties without a guarantor such as a bank or exchange or lawyer sitting in the middle and acting as trustee and mediator. This is a huge deal, unprecedented in human history. It facilitates a form of ownership that we have never previously imagined. One in which trust is not required between any parties in a transaction; it is embedded in the architecture of the transaction itself.
Revolutionary? Yes. But soon it will no longer be magic; it will simply be the rails on which all human transactions glide and the vault in which ownership nestles. Not only in the crypto world, but also literally in the DNA of real-world physical, interpersonal and interbusiness interactions of exchange. How soon? It’s here, now.
Useful, but unremarkable
By the 2030s, no one will mention it much any more. Commented upon no more often we mention the magic of the cellular network or the internet. The crypto of the 2030s will likely be as unremarkable as the wizardry that allows your smartphone to use your face as a password. It will simply just be there. And our possessions will be vastly more secure for it.
But AI? I have to make a different case here. Because there will likely never be a time when we can say – oh, wonderful, AI is here, it is mature, it helps us do better, let is usher it into the fabric of our lives and not think much about it ever again, much like we never think about our fridges and remotely operated car keys.
Why do I make this claim about the special status of AI? Because contained within its architecture is something that no technology before it can claim.
It can learn.
It can learn autonomously.
It can learn with exponentially increasing breadth and depth and fidelity.
Different breed of technology
This differentiates it from any other technology ever invented. It has no precedent. It resists careful impact analysis and rational future-gazing. We have no idea what it means for the future of us.
(Anyone who has any doubt about this should watch this video from Nvidia, now one of the leaders in AI, to see what is coming down the track in the next little while.)
Yes, we understand some of the problems in AI. There are weird hallucinations in ChaptGPT and Bard, making them occasionally untethered to truth. It can be sexist and racist, and sometimes just silly. It can make fabulous images, but it has a hard time telling funny jokes. It is wildly expensive to train. It is unable to do some stuff that a baby can do. Easily outplayed and outfoxed by humans in other stuff.
But most of the AI we see is less than a decade old, and language-driven AI like ChatGPT is only six months old, for goodness sake (although its innards have evolved for much longer than that). And AI’s internal blueprints are now in the hands of everyone, from the cautious to the reckless, from the virtuous to the venal. And it gets smarter daily. Anyone with an opinion about AI based on what they are seeing today is not looking far enough ahead.
So no, AI is not going to disappear into the background texture of our lives. Humanity is going to get blindsided and surprised continuously from now on.
Whether it is good or bad magic remains an open question. DM
Steven Boykey Sidley is a Professor of Practice at JBS, University of Johannesburg.