Artificial intelligence and Blockchain technology have stood out as two strong forces that are driving the wave of transformation in the digital ecosystem. Individually, we have seen their impactful role in almost every industry, including digital apps, software, and other systems. However, the amalgamation of these two technologies opens a plethora of new opportunities.
Currently, AI & Blockchain are being used in real estate, healthcare, e-commerce, payments, fintech, supply chain, logistics, and many other industries separately. The fusion of AI in blockchain will completely change the potential and deliver unparalleled advancement in resultant solutions.
The combination of AI & Blockchain wouldn’t be a sum but instead a multiplication with profound possibilities. AI would help to deliver human-like decisions and support complex algorithms. On the other hand, blockchain will make systems more secure and transparent with its distributed ledger.
In this article, we will go through all the aspects of AI in blockchain and understand how AI can unleash new opportunities by its fusion with blockchain. This article will help you realize how this amazing combination boosts security and transparency and also transforms the traditional methodology of industries.
AI in Blockchain – A Brief Introduction
Artificial Intelligence: With artificial intelligence, our aim is to build solutions that can mimic human intelligence by leveraging data, complex algorithms, and computer technology. It also encompasses the subfields of machine learning and deep learning technologies. These technologies train AI with data to make predictions and classifications. AI helps in decision-making, data analysis, recurring tasks, and reducing human errors.
Blockchain Technology: Blockchain, in simple terms, is a digital distributed ledger that no one can tamper with. It brings data security and transparency. Initially, blockchain technology was supposed to work only for cryptocurrencies, but later, it found its application in various areas. Blockchain transform healthcare sector, supply chain, fintech industry, and many other industries.
The AI in blockchain collaboration will be a robust alliance for better data security, transparency, and high efficiency.
Do you know the combined market size of AI & Blockchain technologies will exceed $703 million by 2025? In 2020, the market size was $228 million. Thus, it will be a compound annual growth rate of 25.3% from 2020 to 2025.
Read More: Blockchain Voting System Development
How AI in Blockchain Technology Will be Beneficial?
Whether you combine AI and blockchain in finance or in any other industry, there will be tremendous benefits. It can overcome the existing roadblocks of the blockchain technology. Let’s explore how AI in blockchain technology can conquer the existing limitations:
a. Improved Data Management:
Currently, blockchain employs hash algorithms for data mining. It uses a “brute force” technique that identifies the correct combination. In this scenario, AI can streamline the data management process and provide an intelligent alternative. It will diminish the intricacy associated with existing methods.
b. Optimized Energy Consumption:
AI refines the data mining process, and due to this, blockchain operations are streamlined. Thus, the blockchain takes less time and effort in the data mining process. It ultimately results in a more energy-efficient process within the blockchain ecosystem.
c. Increased Scalability:
AI introduces advanced decentralized learning systems and novel data-sharing techniques. This helps solve the existing issue of blockchain scalability. It provides high efficiency and creates ample opportunities for newcomers to blockchain app development.
d. Brings Efficiency in Transactions:
With the digitization of economies of several nations, the efficiency and security of online transactions have become the utmost priority for fintech companies. The redundant task performed by each node is one of the core problems. AI can identify which node can deliver a faster solution, allowing other nodes to not put in effort. It will increase the efficiency and reduce these.
e. Improved Security Measures:
Blockchain is renowned for its security, yet the apps built on it are not 100% safe from vulnerabilities. AI capabilities like natural language processing, image recognition, and real-time data transformation bring more capabilities to the blockchain. An Artificial intelligence development company can convert large-scale systems into micro-economic environments. Thus, data transactions will be securely optimized with ML flexibility.
f. Innovative Data Management:
In the upcoming years, blockchain may become the core technology for data storage. Thus, companies would be able to purchase data directly from holders. AI will help to track data usage, manage access, and oversee related tasks.
Applications of AI in Blockchain Convergence:
The convergence of AI and Blockchain has heralded a new era of technological innovation. Whether it is finance, healthcare, communication, or network security, there are uncountable advantages of this amalgamation. Being listed among the top blockchain development companies, we identified key areas that reap significant advantages from this integration. These key areas showcase the broad and diverse benefits of merging blockchain and AI technologies. Let’s discuss each in detail.
1. IoT Applications:
Traditional IoT applications have limitations in security, transparency, privacy, and data integrity. These IoT systems have centralized architecture, and thus, they face vulnerabilities like single points of failure. However, the distributed technology of blockchain offers reliable solutions.
When AI and Blockchain combine, it provides the following major benefits to IoT apps:
· Solutions like NeuRoNT and BlockDeepNet employ blockchain and smart contracts to improve problem-solving and secure IoT network data.
· The architecture of AI will help in areas like big data analysis and predictive monitoring.
2. Cybersecurity:
The blockchain and AI in cybersecurity can improve data confidentiality, integrity, and security in decentralized and centralized networks. There will be AI-enhanced tools for network system protection, along with privacy-preserving smart contracts for monitoring and fraud detection. On the other side, blockchain-based systems will enhance industrial network trust by detecting and recording cyberattacks.
These developments represent a major step forward in tackling cybersecurity issues, especially with regard to data protection and industrial environment security.
3. Energy:
In the energy sector, blockchain and AI are transforming traditional systems through decentralization and efficiency. Blockchain is bringing digitization to physical currencies and enabling direct energy transactions. It results in lower costs with improved monitoring in distributed environments. The artificial technology complements this by tackling complex tasks like energy demand prediction and partner reliability assessments.
At Octal IT Solutions, our developers have expertise in various blockchain programming languages and develop blockchain and AI-based apps for different industries.
4. Smart Cities:
Blockchain & AI technologies are also helping in shaping smart cities to achieve high efficiency, sustainability, and security. The modern urban environments in the developing & developed countries are highly dependent on these technologies.
The blockchain contributes by providing security and privacy for IoT devices in smart cities. This method uses blockchain and AI to ensure secure data transfer between IoT devices without depending on traditional certificate authority for verification.
5. Finance:
The convergence of Blockchain and AI technologies enhances smart contracts and decentralized systems in real-world applications. With the rise of blockchain technology, smart contracts became prominent. Smart contracts are self-enforcing, self-verifying programs that execute predefined conditions automatically without any 3rd party involvement.
The smart contracts offer a huge range of features like traceability, self-governance, and tamper resistance. However, there are still certain vulnerabilities in the existing blockchain technology that pose security risks but AI can manage it.
Ensemble learning algorithms improve data feature extraction, whereas distributed deep learning (DL) accelerates AI training on multiple GPUs simultaneously. AI also handles issues with decentralized IoT and edge computing systems, such as data privacy and resource limitations. Distributed AI collaboration, along with smart contracts, ensures scalability and efficiency in decentralized networks.
6. Healthcare:
In the healthcare industry, AI and Blockchain offer new opportunities for all the stakeholders involved, i.e., patients and healthcare service providers. Using blockchain app development platforms, we have developed healthcare apps that can safely store medical records against cyberattacks and other vulnerabilities. Our developed solutions will access the data in a decentralized layer and give people ownership of their data.
7. Supply Chain:
The smart contracts are already improving with the convergence of AI in Blockchain. If we further combine smart contracts with predictive analytics, it will help supply chain companies to analyze historical data and predict demand trends using AI algorithms.
Supply chain companies would be able to adjust inventory levels automatically, order supplies, and optimize distribution through smart contracts.
Challenges Associated with AI in Blockchain Integration:
There is a huge potential for AI in Blockchain integration. When we integrate artificial intelligence in blockchain use cases, there are significant benefits for the resultant solutions. However, there are certain challenges associated with this amalgamation. Implementing AI on a blockchain network can be computationally intensive, and scalability remains a challenge. Let’s know about all such challenges:
a. Scalability:
There are various scalability issues of blockchain networks that mostly arise while handling a huge number of transactions. The further integration of AI will also increase load at the computational level. It becomes essential to address scalability concerns.
b. Interoperability:
It would be challenging for existing systems to integrate the app developed with AI in blockchain. However, we have experience in blockchain app development, which is compatible with various protocols and standards.
c. Complexity of Smart Contracts:
Smart contracts play a paramount role in automating processes in a blockchain. However, it isn’t an easy task to create smart contracts with AI algorithms. There will be multiple challenges of reliability, auditing, and debugging.
d. Energy Consumption:
Although AI will identify nodes for reducing energy consumption, this concept is still more theoretical than practical. Blockchain networks are highly energy intensive, and incorporating computational requirements will further increase energy consumption. It is essential to develop energy-efficient solutions.
e. Skill Gap:
There is a shortage of skilled experts who understand both AI and blockchain technologies. Bridging the skill gap is critical for the effective development and implementation of AI-powered blockchain solutions.
At Octal IT Solutions, we have a team of talented developers who have vast experience in both AI & blockchain app development. You can share your requirements with us, and we will turn your vision into a digital reality.
f. Costs and Investment:
The initial outlay of developing an app with AI in the blockchain is high. However, the developed solutions will reap much more cost-efficient benefits. Yet, the companies may be hesitant to adopt these technologies as there is no clearly visible monetary benefit.
g. Ethical Considerations:
If AI algorithms are not designed carefully, they can result in ethical issues like bias against certain segments of the audience. Ensuring fairness and ethical considerations in AI applications on the blockchain is important.
Wrapping Up:
The integration of digital technologies into manufacturing and other industrial processes is leading Industry 4.0. In this transformation, AI-powered blockchain technology will play a paramount role. The integration of AI in blockchain holds significant importance for enhancing security, efficiency, and security.
At Octal IT Solutions, we offer AI & blockchain development services beyond technicalities. We pride ourselves on providing the right consultation to our clients and developing solutions that meet their vision. Our developers have vast experience in blockchain app development platforms and blending AI in blockchain effectively. They will ensure that intelligent algorithms seamlessly integrate into the existing business processes. Let us know your requirements.
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