Blockchain and AI are the two most powerful technology trends in the world. On one hand, blockchain offers a versatile technology that empowers users, while AI serves a new perspective on automation. At this point in time, the applications of AI for blockchain developer are grabbing headlines, and people want to know more about the convergence between AI and blockchain technology

You must learn about the interrelationship between blockchain and AI to understand how AI can help blockchain developers. As the demand for blockchain-based applications continues to grow, developers can seek innovative ways to improve productivity with AI. In addition, it is also important to understand how AI and blockchain integration could contribute to developments in real-world use cases. The following post will help you understand the value of AI in the domain of blockchain development.

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Definition of Blockchain 

Blockchain technology is an extremely versatile technology that offers a permanent, distributed ledger that can provide an immutable and shared exchange of data. It is important to learn how blockchain can ensure a transparent exchange of information and financial value. Blockchain networks could help in tracking multiple accounts, production, transactions, payments, and orders.

The answers to questions on “How can AI be used with blockchain?” would require you to focus on the fundamentals of how blockchain works. Users start a transaction on a blockchain network with a request, and it would be broadcasted to a peer-to-peer network of nodes. Subsequently, blockchain networks use distinctive algorithms for validating transactions and the status of a user. 

All the members in the network have permission to have a transparent view of the output. Members in a blockchain network could follow consensus algorithms to improve trust and confidence in transactions. Blockchain is immutable and offers the advantage of cryptographic security, thereby ensuring better advantages for storing data. 

Before you understand the role of AI in blockchain, you should know that blockchain has the potential to promote use cases such as cryptocurrencies and DeFi applications. With the power of AI, developers can make these applications more efficient and productive. 

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Definition of Artificial Intelligence

Artificial intelligence or AI helps in using computers, machines, and data to replicate the decision-making and problem-solving abilities of humans. You can understand the relationship between AI and blockchain by reflecting on the applications of machine learning and deep learning.

Artificial intelligence can provide the advantages of automated decision-making, reduction of human errors, and simplifying recurring tasks. Artificial intelligence can help in addressing the development of technologies, such as big data, robotics, and the Internet of Things. At the same time, experts have discovered the possibilities for blending AI and blockchain together to create technical wonders. 

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How Are Blockchain and AI Related to Each Other?

The question points out directly at the AI blockchain technology relationship and how it would influence the future of technology. Blockchain and AI have multiple points of association, which can help you can identify how developers can use AI technology. Here are the common pointers between AI and blockchain.

Blockchain and AI Common Pointers

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  • Autonomous System

Blockchain and AI can be combined together to ensure the decentralization of all the operations of an AI application. Decentralized ledger technology works as an autonomous system that fuels decentralization alongside managing AI operations and training without supervision. 

  • Transparency of Data Source

The next prominent aspect of the reasons to use AI for blockchain developers revolves around data transparency. AI applications need considerable volumes of data for training the underlying models. Blockchain offers a transparent network with each access to refined data according to request parameters. On top of it, blockchain also facilitates the traceability of transactions and the involved nodes, thereby enabling efficient verification of data sources.

  • Power of Distributed Computing

Artificial intelligence has been hailed as the technology of the future, and it is important to note that AI needs massive sets of computing resources. Blockchain can offer easier, decentralized access to computing resources such as storage, hardware, and software as costs of hardware maintenance. 

  • Augmentation

The possibilities for AI and blockchain integration also draw attention to the ability of AI to do faster and more comprehensive data reading. Therefore, AI could introduce more intelligence in blockchain-based business use cases. Easier access to larger data sets inside or outside the organization ensures that blockchain could improve the scalability of AI. It could also ensure easier access to actionable insights alongside creating a trustworthy and transparent data economy. In addition, blockchain can also provide better ways for managing data usage and sharing of AI models.

  • Reading Efficiency

The power of AI for reading efficiency also shows examples of ways in which the applications of AI in blockchain can bring revolutionary changes. Blockchain technology encounters restrictions on its data storage models due to the low query performance. On top of it, blockchain applications could compromise reading efficiency to achieve a write-intensive approach. 

Interestingly, AI can help in using data storage methods to support the better utilization of blockchain technology. For example, a new TTA-CB protocol can reduce the frequency of problems with data storage by using PSO algorithms. AI can improve through comprehensive testing and training, thereby supporting improvements in data query speed.

  • Security 

Blockchain technology has been marketed with the advantages of security, and they have not been able to stand up to the promise. Smart contracts are vulnerable to flaws in the code and other emerging types of cyber-attacks. If you want to understand the significance of AI for blockchain developer, you must know about the implications of AI for securing blockchain. AI could help in creating secure and error-free smart contracts with the advantage of comprehensive testing and debugging of smart contract codes. 

  • Automation

The most profitable link between artificial intelligence and blockchain development is automation. The relationship between AI and blockchain would introduce new value to business operations across various industries. For example, AI models integrated into smart contracts could work on blockchain technology to resolve disputes. At the same time, AI-powered smart contracts can use higher reading efficiency for selecting shipping methods with higher sustainability. 

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Blockchain and Artificial Intelligence Use Cases

What would a blockchain developer create with AI? You need to find the answer to this question before determining the best practices for using blockchain and AI in unison. You can learn more about the AI blockchain technology relationship with the use cases of both technologies together. Here are some of the possible use cases which highlight the effect of integration between blockchain and artificial intelligence. 

  • Financial Services

One of the biggest examples of using AI and blockchain together would point to financial services sector. You must have heard about decentralized finance or DeFi solutions in the blockchain ecosystem. It enables decentralized and transparent access to financial services through immutable smart contracts and peer-to-peer transactions. The answers to “How can AI be used with blockchain?” would reflect on the possibilities for leveraging AI models in DeFi. AI models could use DeFi as an economic layer for executing certain tasks according to predefined instructions. 

Developers can take a large language model and connect it securely to the internet for conducting general tasks such as payments through DeFi or the financial stack of web3. AI models could execute complex, interrelated loops of financial transactions without the involvement of intermediaries. 

On top of it, AI-based automated investment strategies in DeFi would offer a new range of financial services. AI has the higher ground in terms of decision-making capabilities, while blockchain stands strong in terms of recording economic activity. The combination of both technologies can help in ensuring fraud-detection processes and automated compliance for DeFi applications with AI.

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  • Smart Contract Development

The biggest advantage of artificial intelligence for blockchain would refer to the enhancements in creating smart contract codes with AI. Most of the blockchain and AI courses emphasize the growing dominance of AI-supported development tools. Smart contract developers could use AI-based APIs, which can offer analytics from real-world sensors, generative models, and sentiment analysis. As a result, the combination of blockchain and artificial intelligence could create completely innovative web3 applications

AI can serve a crucial role in transforming smart contract development by unlocking new web3 gaming experiences. Artificial intelligence could ensure that game developers could create completely different game worlds, non-player characters, in-game assets, and game mechanics with simple parameters. The game’s logic would be stored on-chain and would encourage open-source development supported by generative AI models.

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  • Healthcare

Another noticeable industry that would capitalize on the applications of AI for blockchain systems. Blockchain has been recognized as the benchmark for secure and private storage. The advanced AI models could use the data in the healthcare sector to identify recurring patterns and improve diagnosis outcomes. 

AI models could train on data from medical scans and patient health records for delivering accurate diagnoses. On top of it, new encryption techniques, such as homomorphic encryption, can help in processing computations on sensitive data without affecting privacy. 

AI and blockchain could improve data management, security, and privacy for healthcare alongside enabling secure sharing and storage of patient records, sensitive information, and medical research data. With the help of blockchain technology serving data storage needs, AI-based diagnostic tools and personalized treatment plans could offer better privacy. 

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How Will Blockchain Developers Use AI?

The overview of the relationship between AI and blockchain and ways to use them together in real life creates curiosity regarding the uses of AI in the work of a blockchain developer. You can find out the following important pointers which validate the importance of AI in the field of blockchain development. 

  • Research 

The first thing about AI that helps blockchain developers is the power of research. Developers have to go through a comprehensive and rigorous research process to find out the features that would work for their dApp or blockchain network. At the same time, the applications of AI in blockchain development also focus on identifying user requirements and demands. Developers could utilize artificial intelligence for mining massive volumes of data from various repositories. 

In addition, they could also evaluate the data at a faster pace and predict the trends and user requirements according to their needs. Therefore, blockchain developers can avoid complications in the process of making decisions on features they should integrate into their new application. For example, developers could come up with a suitable roadmap for their project and decisions regarding the consensus mechanism

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  • Error Detection and Testing

The most prominent advantage of AI for blockchain developers is visible in the assurance of error detection and testing. Blockchain networks are complex, and it is difficult to manually find and remove bugs in the system. In such cases, AI bots could offer the benefits of programming for creating and running tests to achieve better reliability and accuracy of smart contract code. 

AI bots could help in debugging simple errors alongside monitoring and recording errors in the system through data analytics. Sophisticated AI systems could help in the analysis of the code alongside simulation of multiple scenarios for testing the functionality of smart contracts of blockchain networks.

  • Optimizing the Solutions

Another important value advantage of the use of artificial intelligence and blockchain technology is the assurance of optimization. Artificial intelligence could help in the optimization of blockchain networks by utilizing machine learning to reduce costs and improve operational efficiency. 

For example, AI and blockchain integration could help in the analysis of blockchain data for identifying potential areas of improvement. Developers can also utilize the data mining functionalities of AI for optimizing code for the blockchain network or smart contracts. 

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The review of the possibilities for using AI in blockchain development showcases promising prospects for blockchain and artificial intelligence applications. Both technologies have the potential to transform user experiences alongside ensuring crucial value advantages for developers. The abilities of AI to read through massive heaps of data and the assurance of trust and security with blockchain can revolutionize blockchain development

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*Disclaimer: The article should not be taken as, and is not intended to provide any investment advice. Claims made in this article do not constitute investment advice and should not be taken as such. 101 Blockchains shall not be responsible for any loss sustained by any person who relies on this article. Do your own research!