Markets Daily Crypto Roundup: Crypto Update | Will AI Trading Take Over Crypto?

Released on December 3, 2024 by CoinDesk

In the December 3, 2024 episode of Markets Daily Crypto Roundup, host Jen Senasi delves into the burgeoning intersection of artificial intelligence (AI) and cryptocurrency trading. The episode features a comprehensive discussion with Hamayan Shaikh, CEO of Fetch AI and Chairman of the ASI Alliance, exploring how AI is poised to revolutionize crypto markets, the emergence of AI agents, ethical considerations, and the economic potentials unfolding as we approach 2025.

Introduction to AI in Crypto Trading

Jen Senasi opens the discussion by highlighting AI as a dominant trend influencing crypto markets. She emphasizes the increasing integration of AI technologies and sets the stage for Hamayan Shaikh to elaborate on AI's transformative role.

Jen Senasi [02:03]:
"On today's show, we're joined by CEO of Fetch AI and the Chairman of the ASI Alliance, Hamayan Shaikh. Hamayan, welcome."

Hamayan Shaikh [02:30]:
"Thank you. Nice to be here, Jen. Appreciate it."

AI's Impact on the Future of Crypto Trading

Hamayan Shaikh provides an insightful analysis of why AI is particularly well-suited for the crypto space. He underscores the synergy between decentralization and AI, highlighting how individuals gaining control over their data and machine learning models can drive innovation in decentralized finance (DeFi).

Hamayan Shaikh [02:51]:
"AI is really well suited for crypto because of several reasons. Decentralization effect of people owning their own data and trying to be more in control of machine learning, all the AIs that they create."
"The digital currency itself with AI to AI trading, the microtransactions, it fits beautifully."

He further elaborates on the maturation of AI technology and its compatibility with Web3, suggesting that AI models will significantly influence crypto trading paradigms.

Practical Applications of AI in Crypto Trading

Senasi probes deeper into the practical aspects, asking for tangible examples of how AI and crypto trading might evolve. Shaikh introduces the concept of AI agents and their potential to facilitate peer-to-peer trading without central points of failure.

Hamayan Shaikh [04:26]:
"Fetch AI... we've been working on agent AI agents and agent-based infrastructure. So you launched AI agents which people can own, deploy, and they can do trading, peer-to-peer trading for you."
"A different way of looking at it in the AI world is now agentic system where you actually just hand over not your keys, just your assets to an agent and the agent then goes and looks for other agents to transact with."

This agent-based approach aims to enhance security and reduce risks like rug pulls and market manipulation by maintaining user control over assets.

Challenges and Ethical Concerns of AI Agents

Addressing potential drawbacks, Senasi questions the risks associated with granting autonomy to AI agents over one's assets. Shaikh reassures listeners by explaining the current safeguards in place and future improvements to ensure transactional security.

Jen Senasi [07:25]:
"Is there any drawback or challenge in giving AI agents that autonomy over your assets?"

Hamayan Shaikh [07:25]:
"You will still have to authorize transactions. Our demonstration on Metalex shows that agents can't transact without user approval. In the future, as security improves, agents may handle more autonomous transactions."

On ethical concerns, Shaikh emphasizes the importance of allowing technology to evolve while maintaining auditability and transparency on the blockchain.

Hamayan Shaikh [14:38]:
"Who owns the IP, where does it sit, who uses it, for what purpose? These are important discussions. But technology should evolve first to address use cases before heavy regulation."

The Future of AI and Human Collaboration in Crypto Trading

The conversation shifts to the balance between AI agents and human intuition. Senasi and Shaikh agree that while AI will significantly enhance trading capabilities, human oversight remains crucial.

Hamayan Shaikh [16:35]:
"AI agents will become super intelligent, but humans will always be in the loop. AI will provide tools to make human intuition even better, accelerating decision-making processes."

Jen Senasi [18:17]:
"AI is an extension and evolution of humankind. It's not going to take over but work hand in hand with us."

Recent Developments: ASI Alliance and ASI Train

Senasi introduces the ASI Alliance's latest initiative, ASI Train, prompting Shaikh to explain its significance in enhancing foundational AI models tailored for specific verticals.

Jen Senasi [08:54]:
"...the ASI alliance unveiled ASI Train. Talk to me about what that is and how you plan to see it develop or your roadmap for 2025."

Hamayan Shaikh [09:12]:
"ASI Train focuses on creating foundational models for various verticals like material science and drug discovery. These models, when trained in a decentralized Web3 environment, allow crypto participants to invest and own portions of these high-value AI assets."
"Revenue will stem from inferences made by these models, making them valuable assets unlike volatile meme coins."

Economic Potential and Roadmap for 2025

Delving into the economic implications, Shaikh projects a future where foundational AI models become integral assets within portfolios, appreciating in value as they undergo continuous training and refinement.

Hamayan Shaikh [12:35]:
"Models can be deployed on Web3, allowing investments through DAOs or pools. As models are trained and refined, their value increases, and investors benefit from this appreciation."

Advice for Crypto Traders

As the episode nears its conclusion, Shaikh offers strategic advice to crypto traders aiming to leverage AI's potential.

Hamayan Shaikh [18:50]:
"If you're looking for real value, AI is here to stay. I highly recommend having AI assets in your portfolio that capture the value about to be unlocked."

Notable Projects and Assets in the AI-Crypto Space

When asked about specific projects, Shaikh mentions several noteworthy initiatives outside the ASI Alliance, indicating a diverse and expanding ecosystem.

Hamayan Shaikh [19:26]:
"Projects like Near Protocol, Bittensor, Render, and ICP are interesting. Each exists in different niches within the AI-Crypto space, offering varied opportunities for investment."
"Having a diversified portfolio with these projects could be beneficial, though this is not financial advice."

Conclusion

Jen Senasi wraps up the episode by expressing gratitude to Shaikh for his valuable insights and encouraging listeners to subscribe to the CoinDesk Podcast Network for more in-depth analyses of crypto markets.

Jen Senasi [20:16]:
"Thank you, Hamayan, for joining Markets Daily today. It was a fascinating conversation."
"Thank you to our audience for watching. If you enjoy Markets Daily, please head on over to the CoinDesk Podcast network..."

This episode of Markets Daily Crypto Roundup provides a thorough exploration of the symbiotic relationship between AI and cryptocurrency trading. From the practical deployment of AI agents to the economic opportunities presented by initiatives like ASI Train, Hamayan Shaikh offers a forward-thinking perspective on how AI is set to redefine the crypto landscape. Ethical considerations and the indispensable role of human intuition in this evolving paradigm are thoughtfully addressed, making this episode a must-listen for enthusiasts and professionals alike seeking to navigate the future of crypto trading.