Cryptocurrency asset manager Grayscale says blockchain and artificial intelligence are complementary technologies, even though the market these days treats them as part of the same transaction.
Zach Pandle, head of research at Grayscale, said that while disruptive technologies tend to create clear winners and losers, the relationship between AI and blockchain is more symbiotic than competitive. The rapid adoption of AI is expected to benefit some industries, such as chipmakers, while putting pressure on others, such as the professional services sector.
“Cryptocurrency valuations are highly correlated with declines in software stocks, but we believe blockchain and AI are complementary from a fundamental perspective,” he said in a blog post on Wednesday.
The US stock market has been receiving a lot of attention lately. The S&P 500 Software Index has fallen about 20% since the beginning of the year, and the valuations of virtual currencies have also moved in line with the decline. But Pandl argues that parallel drawdowns obscure a more constructive long-term dynamic between the two technologies.
Investor fears about the disruptive potential of artificial intelligence have caused a sharp selloff in tech and software stocks, erasing significant market value as traders reassess long-held valuations.
U.S. software and services stocks have plummeted, wiping out about $1 trillion in market capitalization amid growing concerns that rapidly advancing AI tools could upend traditional business models and revenue streams.
The S&P 500 Software Index fell as investors exited hot tech stocks amid heightened volatility and skepticism about how quickly and profitably AI adoption would be.
Pandl argues that blockchain is likely to become the economic rails for AI agents. Today’s chatbots primarily operate outside of the financial system. However, he predicts that if AI agents are equipped with digital wallets, they will be able to transact on blockchain rather than traditional banking infrastructure.
He said blockchain offers transparency, near-instant payments, 24/7 availability, and global reach through internet connectivity. Opening a bank account requires a human intermediary, but any user, including bots, can create a blockchain address. Pandol said that an increase in the volume of low-value stablecoin transactions would be an early sign of this theory coming to fruition.
At the same time, he argued that blockchain technology could help mitigate some of the risks of AI. As large-scale language models proliferate, concerns about data provenance, deepfakes, and centralization of control over resources and decision-making are likely to grow. Pandor said public blockchains can provide verifiable records and a more decentralized infrastructure to counter these trends.
The report also acknowledges that AI could pose new challenges for crypto networks. Advanced tools can make blockchain monitoring more effective and compromise user privacy. AI agents may also discover new vulnerabilities in smart contracts. OpenAI recently launched EVMbench, an initiative aimed at using AI to identify and patch such risks.
read more: Cryptocurrency isn’t losing out to AI, Dragonfly says, it’s just “capitalism doing its job.”