Why Blockchain could be the solution for data quality and ethics in AI

Why Blockchain could be the solution for data quality and ethics in AI

Artificial intelligence (AI) is transforming the world in unprecedented ways, offering new possibilities for innovation, efficiency, and social good. It also poses significant challenges and risks, especially when it comes to the quality and ethics of the data used to train and operate AI systems. Data is the fuel that powers AI, and the quality and ethics of data directly affect the accuracy, reliability, and fairness of AI outcomes. Poor data quality can lead to errors, biases, and inefficiencies, while unethical data collection and usage can violate privacy, security, and human rights. Therefore, it is imperative to ensure that the data that feeds AI is trustworthy, transparent, and accountable. This is where blockchain technology can play a vital role.

Blockchain is a distributed ledger that records transactions in a secure, verifiable, and immutable way. It can provide a decentralised and tamper-proof platform for storing and sharing data among multiple parties, without the need for intermediaries or central authorities. It can also enable smart contracts, which are self-executing agreements that can trigger actions based on predefined rules and conditions. Blockchain can enhance the quality and ethics of data in AI in several ways, such as:

  • Authenticity: Blockchain can verify the origin and provenance of data, ensuring that it is authentic and reliable. The ability to track the changes and modifications made to data over time, creating an audit trail that can help detect and prevent fraud, manipulation, and corruption. For example, it can help verify the identity and credentials of data providers, as well as the consent and permissions of data subjects. It can also help validate the quality and accuracy of data sources, as well as the integrity and consistency of data processing and analysis.
  • Augmentation: I believe it can augment the intelligence and capabilities of AI by providing access to large and diverse datasets that can enrich the learning and performance of AI models. It can also facilitate data sharing and collaboration among different stakeholders, such as researchers, developers, regulators, and users, enabling cross-domain and cross-border data exchange and interoperability. The technology can also leverage smart contracts to automate data transactions and operations, such as data acquisition, aggregation, annotation, cleaning, and labeling, as well as data monetisation, compensation, and governance.
  • Automation: As mentioned in my speeches, blockchain helps to automate the ethical and legal aspects of data and AI, such as compliance, accountability, and transparency. It can embed ethical principles and values into the design and development of AI systems, as well as the data that feeds them. It can also enforce ethical rules and regulations through smart contracts, such as data protection, privacy, security, and consent. It can also provide mechanisms for monitoring, auditing, and reporting the impacts and outcomes of data and AI, as well as for resolving disputes and addressing grievances.

Blockchain and AI are complementary technologies that can create synergies and benefits for each other. I have mentioned very briefly in my earlier article on trends to look at in 2024. Blockchain can improve the trustworthiness of data resources that AI models pull from and increase the speed of AI operations by connecting models to automated smart contracts. AI can enhance the efficiency and scalability of blockchain by optimising its performance, security, and usability. Together, they can create a more trustworthy, transparent, and accountable data and AI ecosystem that can foster innovation, value creation, and social good.

However, this combination is not a silver bullet that can solve all the challenges and risks of data and AI. They also have their own limitations and drawbacks, such as technical complexity, performance issues, energy consumption, and governance challenges. Therefore, it is important to adopt a holistic and balanced approach that considers the opportunities and challenges of both technologies, as well as the ethical and social implications of their integration and application.

The potential of this intersection is not only theoretical, but also practical and observable. Recently, several developments have highlighted the emerging synergy between AI and cryptocurrency, which is a subset of blockchain technology that enables digital currencies and payments. For instance, Grayscale Investments, the world’s largest digital asset manager, published a research report that reveals the impressive performance of AI-related crypto assets, which are up 522% in the last year, outperforming the Utilities and Services Crypto Sector (+86%) over the same period. The report also discusses how blockchain and AI can address future AI-related societal issues, such as the rise of deepfakes, concerns around data privacy, and concentration of power.

Another example of the convergence of AI and cryptocurrency is the AI fever that took over the World Economic Forum in Davos, Switzerland, in January 2024, pushing crypto aside as the new cool kid on the block. Some of the world’s biggest companies, such as Intel and Salesforce, showcased their AI products and services, while the AI House hosted events and discussions on various topics related to AI and blockchain, such as verifying content authenticity, reducing model bias, and improving access and competition within AI development. The AI dominance at Davos reflects the rapid rise in AI investments and interest last year, sparked by the explosion of popularity of ChatGPT, the AI chatbot developed by OpenAI, and launched at the end of 2022. ChatGPT is an AI system that can generate natural language responses to any text input, using a large dataset of internet conversations. It has been widely praised for its ability to produce coherent, engaging, and sometimes humorous dialogues, as well as for its potential applications in various domains, such as education, entertainment, and customer service.

In my opinion, it also raises some ethical and technical challenges, such as the risk of generating harmful or misleading content, the lack of transparency and accountability of its algorithms, and the difficulty of verifying and controlling its data sources. This is where blockchain technology can come in handy, as it can provide solutions for ensuring the quality and ethics of the data and AI. For instance, blockchain can help verify the origin and validity of the data used to train and operate ChatGPT, as well as the consent and preferences of the users and data subjects. Blockchain can also help track and audit the changes and outcomes of its interactions, as well as enforce ethical rules and regulations through smart contracts. Blockchain can also help augment and automate ChatGPT’s capabilities, by providing access to more diverse and reliable data sources, facilitating data sharing and collaboration, and enabling data monetisation and governance.

In conclusion, blockchain technology can offer a valuable solution for enhancing the quality and ethics of data and AI, as well as for creating synergies and benefits with AI and cryptocurrency. This intersection is not only theoretical, but also practical and observable, as evidenced by the recent developments in the field, such as Grayscale’s new study and the AI fever at Davos. These developments indicate a transformative phase where AI and cryptocurrency coalesce, fostering a landscape ripe for innovation and societal benefit.

This union is not only redefining blockchain’s utility, but also addressing critical challenges in AI governance and development. However, this union also requires a careful and balanced approach that considers the opportunities and challenges of both technologies, as well as the ethical and social implications of their integration and application.

 

 

 

Source: https://ciosea.economictimes.indiatimes.com/blog/why-blockchain-could-be-the-solution-for-data-quality-and-ethics-in-ai/107618432

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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EXCLUSIVE: Spot Ethereum ETF Could Unlock ‘Full-Scale, Global Adoption,’ Experts Tell Benzinga

EXCLUSIVE: Spot Ethereum ETF Could Unlock ‘Full-Scale, Global Adoption,’ Experts Tell Benzinga

Investors were initially curious about Spot Ethereum Exchange Traded Funds (ETFs). However, after the approval of Bitcoin ETFs, these have now captured their full attention.

Benzinga gathered exclusive commentary from several experts to gauge the prospects for a spot Ethereum ETF approval this summer.

 

What Is The Current Status Of Spot Ethereum ETFs?

Tom Staudt, president and COO of ARK Invest, recently expressed confidence in the progression of Ethereum ETFs.

He cited the maturing dialogue with regulators and the sophistication of conversations surrounding the ETF, saying, “This is not the same place where we were on the timeline with Bitcoin at this stage.”

Staudt notes that potential issuers now possess greater legal, operational, and philosophical expertise, partly due to the successful approval of spot Bitcoin ETFs.

But skeptics warn of regulatory roadblocks and lingering doubts about Ethereum’s classification as a security. At the heart of the debate lies, once again, the Securities and Exchange Commission.

 

Will The SEC Play Ball?

Anndy Lian, an intergovernmental blockchain advisor, tells Benzinga that the SEC should act in the “best interest of the public and the crypto industry” by making a “timely and positive decision” on Spot ETH ETFs.

His comments highlight the widespread anticipation surrounding the potential ETF’s arrival, with both retail investors and institutional giants eager to gain exposure to the world’s second-largest cryptocurrency.

But the SEC had to be “dragged kicking and screaming” to approve one spot cryptocurrency ETF, he adds, and there is no guarantee a second one would be any easier.

 

Ethereum ETFs Could Spur “Full-Scale, Global Adoption”

The case for Ethereum is simple, according to Stijn Paumen, the founder of Helio.

He paints a vivid picture of a future transformed by Ethereum’s mainstream adoption. The ETF approval would be a catalyst for “full-scale, global adoption of cryptocurrency.”

Everyday purchases, from your morning coffee to online shopping sprees, could be made with a simple tap of your crypto wallet.
His infectious enthusiasm captures the transformative potential of blockchain technology and its ability to disrupt traditional financial systems.

 

Even Bitcoiners Think It’s Coming

Terrence Yang, managing director at Swan Bitcoin, acknowledges the inevitability of an ETH ETF, albeit somewhat grudgingly.

He concedes that legal precedents and the SEC’s recent Bitcoin approvals have tilted the scales in favor of Ethereum.

Indeed, as Decrypt reported, analysts agree that Bitcoin’s approval has set a precedent: Grayscale argued in court – and won – that the SEC could not approve a futures ETF and reject a spot ETF. Since futures Ethereum ETFs have already been approved, logic holds that a spot ETF would have to follow – as it did for Bitcoin.

 

So…When Ethereum ETF?

Chris Martin, head of research at Amberdata, a crypto data analytics firm, says an Ethereum ETF should come sooner rather than later.

Issuers will face two major challenges at the SEC:

  1. The SEC doesn’t have the public pressure it did for the Bitcoin ETF which means, they can take their time and don’t have to worry about passing all of the issuers at once
  2. The SEC is still pushing the security vs commodity stance without any clarity.

“Approving an Ethereum ETF may impact their current cases against Coinbase Inc  and Binance, and may push them closer to defining their stance on cryptocurrencies,” he says.

Prediction markets agree, with Polymarket rating the probability of an approval by May 31 only at 54%.

Should the SEC grant its blessing, the implications for the financial landscape could be profound. Mass adoption may come a step closer after all.

 

 

Source:

https://www.benzinga.com/markets/cryptocurrency/24/01/36759529/exclusive-spot-ethereum-etf-could-unlock-full-scale-global-adoption-experts-tell-benzinga

https://markets.businessinsider.com/news/etf/exclusive-spot-ethereum-etf-could-unlock-full-scale-global-adoption-experts-tell-benzinga-1032994135

https://uk.investing.com/news/cryptocurrency-news/exclusive-spot-ethereum-etf-could-unlock-fullscale-global-adoption-experts-tell-benzinga-3310170

https://www.nasdaq.com/articles/exclusive:-spot-ethereum-etf-could-unlock-full-scale-global-adoption-experts-tell-benzinga

FAQ

What is the current status of Spot Ethereum ETFs, and how does it compare to the timeline of Bitcoin ETFs?

According to Tom Staudt, president and COO of ARK Invest, there is growing confidence in the progression of Ethereum ETFs. Staudt points to a maturing dialogue with regulators and increased expertise among potential issuers, influenced by the successful approval of spot Bitcoin ETFs. However, skeptics highlight potential regulatory roadblocks and uncertainties about Ethereum's classification.

How does Anndy Lian, an intergovernmental blockchain advisor, view the SEC's role in the approval of Spot ETH ETFs?

How do Bitcoiners, represented by Terrence Yang, view the inevitability of an ETH ETF?

Terrence Yang, managing director at Swan Bitcoin, acknowledges the inevitability of an ETH ETF, influenced by legal precedents and the SEC's recent approvals for Bitcoin. Despite some reluctance, Yang concedes that the scales are tilting in favor of Ethereum, especially considering the precedent set by Grayscale's court argument and victory.

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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How Singapore’s stablecoin rules could boost crypto’s ‘mainstream’ banking role

How Singapore’s stablecoin rules could boost crypto’s ‘mainstream’ banking role
  • Industry executives say the proposed rules by the Monetary Authority of Singapore are timely and will boost investor confidence
  • Recent moves by Hong Kong and Europe on rules governing stablecoins will also spur wider adoption of cryptocurrencies, according to the executives

 

The unpredictable price fluctuations of cryptocurrencies have been a make-or-break game for myriad investors across Asia for months.

However, only a handful of regional policymakers have ventured to integrate these volatile assets into the mainstream financial landscape.

Now, the latest move by Singapore’s central bank to introduce regulatory guidelines for stablecoins could prove to be a milestone for its rapid adoption in traditional channels like banks, analysts say.

Unlike other cryptocurrencies, stablecoins are viewed as safe haven assets as their values are pegged to traditional currencies or other assets such as government bonds and gold.

The Monetary Authority of Singapore building in Singapore. Photo: Bloomberg
The Monetary Authority of Singapore building in Singapore. Photo: Bloomberg

The Monetary Authority of Singapore’s (MAS) regulations announced last week will apply to nonbank users of single-currency stablecoins pegged to the Singapore dollar, or any currency from the world’s 10 biggest economies, and would require issuers to maintain low-risk reserves and return par value to investors within five days of receiving a redemption request.

“The MAS seems to be paving the way for greater trust and potential formal integration of stablecoins into the banking system.

However, as these regulations are scheduled to come into effect in 2024, their precise impact on bank transactions will [need to] be monitored closely,” said Chen Zhuling, founder and CEO of crypto finance gateway RockX.

The central bank would need to hold legislative consultations before Parliament passes amendments that would bring the framework into force. The coins will be labelled as MAS-regulated stablecoin.

The distinction of having central bank-regulated stablecoins, as opposed to non-regulated cryptocurrencies, is likely to ease concerns about their stability that have curtailed their usage for physical transactions, analysts say.

Stablecoins have been the backbone for cryptocurrency trading and can potentially slash transaction costs associated with traditional banking systems to a nominal amount, while speeding up processing times to seconds.

But stablecoins have in the past failed to make inroads into mainstream financial systems because of a lack of transparency about their reserves.

Popular cryptocurrencies like bitcoin and ether tend to suffer from high price volatility. Photo: Reuters
Popular cryptocurrencies like bitcoin and ether tend to suffer from high price volatility. Photo: Reuters

Anndy Lian, author of the book NFT: From Zero to Hero, said Singapore’s guidelines could bridge the gap between fiat currrencies and digital assets.

“But this should not necessarily mean that banks will start to accept all kinds of cryptocurrencies. The volatility of other cryptocurrencies is still a red flag for many,” he said.

Popular cryptocurrencies like bitcoin and ether tend to suffer from high price volatility, whereas stablecoins tend to hold steady since they are linked to fiat currencies and other such assets.

Despite their relative safety, clamours for regulation of stablecoins grew after two such sister currencies – Terra and Luna, whose values were algorithmically pegged to the US dollar and not backed by cash – suddenly collapsed in May last year.

Singapore’s strict guidelines are meant to reassure both investors and institutions that could open new avenues for the asset class, industry executives say.

“Banks may even issue stablecoins for tokenised bank deposits as part of their rapidly developing digital transformations,” said Gerald Goh, co-founder and CEO of Sygnum Singapore, a digital assets fintech group.

“This model – fully regulated, traditional-asset backed and pegged to a high-quality ‘stable’ fiat currency like the Singapore dollar – has the potential to become a blueprint for the industry,” he added.

Do Kwon, the cryptocurrency entrepreneur who created the failed Terra stablecoin, is taken to court in handcuffs in Montenegro in March. Photo: Reuters
Do Kwon, the cryptocurrency entrepreneur who created the failed Terra stablecoin, is taken to court in handcuffs in Montenegro in March. Photo: Reuters

First among digital equals

Singapore’s stablecoin framework will put it among the first jurisdictions to have rules to prevent mishaps.

Rival financial hub Hong Kong is, meanwhile, undergoing a public consultation on stablecoins and seeks to introduce regulation for them next year.

The European Commission set the ball rolling with the Markets in Crypto-Assets (MiCA) regulation, which it introduced with the purpose of establishing a global benchmark for governing cryptos.

After being proposed by the commission in September 2020, the European Parliament approved the MiCA regulation on April 20. It is due to come into force for stablecoins from June 2024, and for other assets from December.

Anne-Sophie Cissey, head of legal and compliance at crypto firm Flowdesk, said the European legislation has set the tone for markets. “With clarification on the legal status, all crypto actors will feel more at ease to deal with those.”

Singapore’s regulation could speed up stablecoins adoption across the region, industry executives say.

“Regulators now collaborate with international entities, for example, MiCA’s announcement in Europe led to similar guidelines in various countries,” said Danny Chong, co-founder of online asset tracker Tranchess.

“This trend suggests that financial hubs like Singapore and Hong Kong should move towards converging rules. This convergence might take a few years to materialise, rather than happening immediately,” he said.

Hong Kong’s regulations are likely to follow Singapore’s soon, as it has been earnestly trying to woo crypto investors. In June, it introduced retail trading and licensing guidelines for crypto.

Many investors have already begun to gravitate towards tokenised assets.

“We are increasingly seeing more stablecoin adoption in Asia,” said Henry Zhang, founder and CEO of DigiFT, a Singapore-based decentralised digital asset exchange, adding that they were looking forward to introducing MAS-regulated stablecoins.

Tokenised US short-term bills have exploded to US$600 million this year, said Timo Lehes, co-founder of Swarm, a regulated decentralised finance platform based out of Germany, citing data from Coindesk.

The digital assets have also started making inroads past intermediaries in traditional financial channels, he said.

“We are already seeing applications taking tokenised forms of cash and financial products that cut out the middleman. In this new world, financial institutions will need to rethink financial product design that puts consumers at the heart,” Lehes said.

Central banks have laid the groundwork for cyptocurrency adoption with countries like China, India and Australia either planning to or having launched a central bank digital currency that can compete with stablecoins, said an industry executive.

“This will drive the choice and innovation needed in the market that will lead to mass adoption,” said Vincent Chok, CEO of Hong Kong finance firm First Digital.

Source: https://www.scmp.com/week-asia/economics/article/3231578/how-singapores-stablecoin-rules-could-boost-cryptos-mainstream-banking-role

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

j j j