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The world is facing a new technological race, with AI development growing into a national priority. The recent launch of the Stargate project in the US is a high proof of that.
While Trump’s presidency is still in its early stages, we can already see the emergence of a trend towards tech-centricity, as he plans to pour $500 billion worth of investments into AI infrastructure.
At the same time, this technological boom is set to reshape another industry crypto.
AI (artificial intelligence) has already been introduced into crypto in the form of AI agents, trading bots, automated risk analysis and more.
The question isn’t whether AI will change crypto it’s doing it even now.
The real question is hat does this mean for crypto and blockchain in the long run?
Will AI’s involvement strengthen this space or undermine the decentralized principles the crypto community holds dear?
Here is my take on this.
AI and crypto today
The way things are now, I’d say that AI’s presence in crypto hasn’t progressed far t’s still in the ‘infancy’ stage, so to speak.
But this state of things won’t last progress is happening at a rapid pace.
This industry is moving beyond simple trading bots. Artificial intelligence is now being used to drive market-making strategies and risk assessment.
We are even seeing cases of decentralized venture funding powered by AI.
Projects like Moby AI, Griffain AI and HeyAnonAI are becoming more prolific nd while these are just early iterations of AI-based financial intelligence in crypto, they are already outperforming human traders in speed and efficiency.
As AI models continue to grow in complexity and gain greater autonomy, I believe that soon they will no longer just follow market trends they will shape them.
What’s next on the horizon
The next few years will redefine what it means to participate in crypto, and AI is going to be at the center of this transformation, bringing changes in all sectors.
Autonomous AI trading agents are already optimizing market strategies in real-time with a level of speed and precision that far exceeds human capabilities.
The more these bots advance, the greater competitive edge investors and traders will get from using them.
In the field of DeFi compliance, AI-powered tools will become essential for maintaining security.
Fraud and illicit transactions are always a point of concern, but AI-driven monitoring systems can analyze activities in blockchain networks and detect suspicious patterns in real time.
This will allow them to flag potential risks before they escalate, making this space safer.
At the same time, AI-integrated DeFi services will help streamline lending and borrowing by removing human intermediaries.
AI models can be leveraged to automatically match borrowers and lenders and adjust interest rates dynamically as market conditions change.
And all of that can be done without the need for human participation.
I can also see on-chain AI agents playing a prominent part in governance.
They can provide real-time market insights, manage portfolios and even contribute to DAO decision-making by enabling more data-driven governance choices.
Beyond financial applications, AI could also solve long-standing blockchain inefficiencies.
For example, one major issue with PoW (proof-of-work) networks is high energy use.
AI can address this by analyzing and predicting network demand, dynamically adjusting energy consumption to reduce waste and optimize performance.
Moreover, AI can facilitate ‘sharding,’ where blockchain data is divided across multiple nodes, allowing parallel processing and faster transaction times.
This can help effectively scale blockchain networks, which is a critical step if cryptocurrencies are to see broader adoption.
While AI today is still only a support tool, incapable of truly making effective decisions in place of humans, it will not always be so.
To my mind, AI has all the chances of evolving into a dominant force that will actively shape the future of DeFi.
The risks an AI undermine decentralization
While AI promises a great upturn in efficiency, it is admittedly not without risks. And one of the biggest threats that I can foresee now is AI-driven market manipulation.
Imagine a scenario where AI-powered trading firms control DeFi, making it that much harder for retail investors to compete.
This is already something that we’re seeing in TradFi (traditional finance), as high-frequency trading firms use AI to exploit market inefficiencies.
The same could happen in DeFi, resulting in an arms race between AI bots, while human traders remain outmatched and essentially get left behind.
That said, DeFi has a bit of an advantage in this regard. Its high spreads and transaction fees act as a natural barrier against immediate AI domination.
Since trading bots in DeFi must deal with significant costs, it creates a chicken-and-egg situation.
As long as fees and spreads remain high, AI-driven trading won’t scale easily. And on the other hand, without a large trading volume, those costs will stay high.
This may actually prevent AI-driven market manipulation, since everyone in DeFi has to operate on equal terms.
Beyond that, there’s also the issue of AI-generated smart contracts to consider. AI can write entire contracts, but what happens if those contracts contain hidden vulnerabilities?
Hackers could exploit AI-generated code, using adversarial inputs to bypass security audits.
A single compromised AI-generated contract could mean millions of dollars’ worth of losses in crypto assets.
This is a threat that DeFi developers will have to take very seriously ou absolutely should not rely on AI to write the code for you.
The future of AI and crypto
The AI race is not just a competition for dominance between nations the real battle is between open-source and closed-source AI.
The introduction of DeepSeek R1 has already become the basis for a major shift in this regard.
It broke traditional assumptions about AI development, proving that billion-dollar budgets of BigTech companies aren’t always necessary for groundbreaking innovation to take place.
AI development is no longer centralized, and I think that open-source models could align well with crypto’s values, as opposed to a more centralized approach.
The idea that AI will take over the crypto sector is no longer a matter for debate. The only question now is how fast it will happen.
Arthur Azizov is the CEO of B2BINPAY, an all-in-one crypto ecosystem for businesses. He is a seasoned leader and innovator with over 15 years of expertise in fintech, global finance and cryptocurrency. His deep understanding of financial markets and digital assets has been instrumental in shaping B2BINPAY into a comprehensive solution for crypto payments, digital asset management and B2B transactions.
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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
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