Nvidia’s Not the Only AI Investing Play Out There
Nvidia’s not the only AI investing play out there – not by a mile (even if its share price does suggest otherwise). And the one that’s got my attention now is in crypto. See, eventually blockchain will integrate with AI, and there are going to be some pretty good opportunities when it does.
First, What Does Blockchain Even Have to Do with AI?
AI, of course, allows machines to do things that typically require a human brain, like making decisions, recognizing patterns, and learning from experience. But AI needs tons of data to thrive, and blockchains can be (among other things) a way of storing and managing that data, working across a decentralized network of computers without a central entity that keeps everything in check.
That’s one of its distinctive features actually. Look, most AI today runs on central servers like Amazon Web Services or Google Cloud. These make AI data requests quick and easy to manage, and with cutting-edge security to boot. Blockchains, meanwhile, are still a bit behind on the speed and usability end of things, but they could be much better for privacy – without a central authority holding the keys to the kingdom. Plus, blockchains don’t have a single point of potential failure like those central servers. And once data goes on the blockchain, it becomes immutable – as in, it can’t be altered in any way.
So that’s what makes this intriguing. The Big Ideas 2024 report from Cathie Wood’s Ark Invest says convergence among disruptive technologies will define this decade – and that the convergence of blockchain and AI will be a part of that story. When I asked ChatGPT for its assessment, it said there’s a “high probability” that AI will run on a combination of central servers and decentralized blockchains in the future.
So Where’s the Opportunity Here?
If you agree with me (and Ark Invest) and see a future between blockchain and AI, then you’ll want to invest in the crypto projects that are positioning themselves as AI leaders. And rather than trying to pick a single winner, you’ll want to spread your bets across a few. Here are the five that I’d consider.
1. Solana (SOL)
According to a recent survey from CoinGecko, Solana is now the world’s fastest blockchain in terms of transactions per second (TPS). That speed could come in handy if it’s going to support AI data requests and applications. What’s more, Solana could get even faster after its Firedancer upgrade, which is expected to go through later this year.
2. NEAR Protocol (NEAR)
NEAR Protocol isn’t as fast as Solana, but it makes life easy for developers who are looking to build AI projects on its blockchain. The project actually started as an AI business in 2017 – and now processes over five million blockchain transactions per day. It uses “Nightshade” technology to split its blockchain into smaller parts. So, in theory, it can scale to handle a lot of data without a problem. Keep in mind, however, that NEAR’s market value is only about a tenth of Solana’s, so the token could be more volatile (both to the upside and the downside).
3. Render (RNDR)
Nvidia’s stock has exploded because of AI-led demand for its graphics processing unit (GPU) chips. GPUs are like car batteries for handling AI computations and data: the more powerful the battery, the better the car performs. Render is essentially a decentralized network of GPUs all working together to lighten the load. If you’re looking for more GPU power, you hand over some RNDR tokens. And if you’re looking to lease out your GPU power, you earn RNDR.
4. Arweave (AR)
Arweave is a blockchain-based data storage solution that could work well with AI. The gist is that Arweave keeps data secured forever through its “permaweb” network. AI applications can easily retrieve that data, but it can’t be changed or tampered with. That’s useful for AI models that rely on historical data for training. And AR tokens are the currency you pay to store data on Arweave.
5. Chainlink (LINK)
Last, but not least, there’s Chainlink, which brings accurate and reliable data to blockchain. It uses a network of “oracles” (pieces of software that link blockchains to the internet) to find the best available data out there. Since AI needs quality data, and Chainlink is the market leader in the oracle niche, it’s a natural fit for this list.
Conclusion
As AI and blockchain continue to converge, it’s only natural that we’ll see new investment opportunities emerge. By positioning yourself to take advantage of these developments, you’ll be well-positioned to reap the benefits as the two technologies continue to intertwine.
FAQs
Q: What is the connection between AI and blockchain?
The connection between AI and blockchain lies in their shared goal of decentralization. Both technologies aim to eliminate central authority and empower users with more control over their data.
Q: Why should I invest in these crypto projects?
By investing in these crypto projects, you’ll be positioning yourself to benefit from the convergence of AI and blockchain. Each project offers unique opportunities and benefits that can help you navigate this exciting new frontier.
