Botto, the AI creating and selling its own art, popped off at the beginning of 2025 as human onlookers wondered, “Can AI be an artist?” Those interested in involving themselves with Botto can stake their funds in the DAO that controls it (for now…).
AI’s critical role in blockchain businesses has only grown since its glow up in 2024. As intertwined as they’ve become, you may find yourself asking: is AI using blockchain, or is blockchain using AI? We’re here to demystify the upcoming 12-month trajectory of these bosom buddies so you can plan accordingly. Let’s go.
AI and blockchain: two powerhouse technologies
Artificial intelligence, at its current stage of development, is better defined as super-fast computing. AI seems intelligent because it has access to vast amounts of data and can parse it faster than any human. The true magic happens when AI rearranges and iterates on existing data.
While 2024 was a bang-up year for AI, user-level AI first emerged in 2022 with the first iteration of ChatGPT. It didn’t catch much attention — the chatbot was slow, clunky, and amounted to a rudimentary Q&A game. Not very exciting.
What made 2024 different was the significant uplevel of ChatGPT, its expanded use cases, and open access to MLMs. For the first time, startups and small businesses could apply AI to their own business models.
Here are some of the major milestones AI experienced in 2024:
- ChatGPT version 4o released in May 2024 and provided eerily human performance.
- Generative AI emerged, solving the problem of AI running out of the massive amount of data required to build Large Language Models.
- AI-enabled search emerged everywhere, from search engines to smart devices.
- OpenAI introduced its reasoning model o1, which shifted the score on AI hallucinations, putting the burden of proof on the AI itself.
Meanwhile, Blockchain has been active in every industry across the planet. The blockchain is a highly redundant system of computers that constantly check each other’s work and verify any new information before adding it to the ‘chain’ of data. This hyper-secure network relieves any need for human oversight, making it ideal for democratizing systems.
Major blockchain milestones in 2024 include:
- Bitcoin hit over $100,000 in value for the first time
- TON (the open network) accelerated the application of Telegram’s mini apps
- HBO attempted to reveal the identity of Satoshi Nakamoto (and seems to have failed)
- Solana bit at the heels of Ethereum, with many declaring ‘Ethereum is over!’
Despite its acceleration, AI still had some weaknesses. We covered those in depth in our AI Minions article which was recently updated. The. Blockchain and AI convergence, however, redefine the cutting edge.
The emergence of a convergence
With AI’s popularity, it seems natural that a blockchain convergence would emerge. AI enhances blockchain technology in several key ways. Here is what you need to know.
Efficiency
- AI can analyze large swaths of data while blockchain delivers the transparent, immutable ledger. Together, blockchain and AI reduce the need for intermediaries and speed up decision-making. This makes their combination perfect for the supply chain industry where accuracy is critical.
- Blockchain takes the typically centralized AI databases and decentralizes them, ultimately distributing computational power and data. This is a superpower for IoT projects or decentralized cities by enhancing collaboration.
- AI is great for automation, while blockchain streamlines record keeping. Combined, blockchain and AI can reduce costs for small businesses and in DeFi where gas fees are high.
Improved Scalability
- AI is power hungry. Even MIT is concerned. Blockchain, on the other hand, offers distributed and decentralized nodes. This allows AI to scale with less power concerns.
- Blockchain needs consensus to add to the chain and grow, often leading to computational bottlenecks. AI can analyse traffic and ensure the scalability of a network. This can help chains like Ethereum be more efficient.
- Blockchain involves massive amounts of ever-growing data stores. AI can automate review of that data, looking for redundancy to reduce overall data size. This again can help IoT projects and financial transaction ledgers.
Data Management
- AI is also a hungry hungry hippo when it comes to data, and blockchain keeps data transparent. AI and blockchain can greatly improve trust in healthcare and medical fields by preventing data manipulation.
- AI is great at noticing patterns while blockchain’s transparency ensures fraud is noticed fast. Together, they provide a fantastic solution for fraud prevention in DeFi.
- Related to point three in Scalability, both blockchain and AI need a lot of data. AI helps blockchain projects with fast analysis of that data, perfect for healthcare and financial institutions.
A two-way street
Let’s not get carried away thinking only AI enhances blockchain. The relationship goes both ways. Blockchain is a perfect partner to AI, making it stronger and more secure. Let’s have a look at the three critical areas where it does so:
Transparency
- A common cause for concern about AI is its data sources. Blockchain can provide its open ledger of data for AI to train on, as well as trace the use of that data in AI systems. Think AI and blockchain for legal and healthcare organizations.
- As AI is a typically centralized technology, its governance decisions often occur behind closed doors. Blockchain’s superpower, on the other hand, is transparent and democratic decision making, giving AI more accountability, perfect for finance and government applications.
- Today, AI is being applied to critical practices such as hiring, and concerns have been raised about fairness. Not to worry: blockchain can transparently store fairness audits to increase transparency of users.
Improved Trust
- Smart contracts are a perfect fit to guard against AI hallucinations and other common AI mistakes. Smart contracts can be programmed to execute only when certain conditions are met. AI-driven insurance claims combined with smart contracts for payout conditions provide the perfect use case for this combination.
- Since AI is on the cutting edge, it needs to be updated regularly (and sometimes resists doing so). Blockchain’s immutable ledger can keep track of updates and improvements so users know exactly what is going on. Yet another win for fraud detection from this power couple.
Data Privacy
- As we’ve covered, AI is greedy about data. Blockchain provides an excellent solution by holding data in native wallets. As a result, users don’t lose ownership of their data and can pull out any time. SingularityNET provides a great example of an effective blockchain and AI convergence on data licensing.
- On the flip side, sharing AI models can expose sensitive data sources. Blockchain provides a secure encryption solution for that data. Healthcare data managers can rejoice.
Before we dive into use cases, you should keep this in mind: AI agents can tirelessly manage blockchain projects around the clock. They don’t need to sleep or eat. This alone gives an edge to emerging businesses. Let’s have a look at what else they can do.
Ready, set, use case for AI and blockchain convergence
It’s clear that blockchain and AI are the power couple of the decade. We predict AI agents will become Web3 entrepreneurs’ BFF in 2025. The following industries will be particularly excited about implementing their use. Let’s have a look at how you can harness their horsepower:
AI and blockchain in healthcare
- Health record management: Blockchain can securely store data while AI can analyze it over the long term. This is especially exciting in the realm of diagnostics.
- Clinical trials: Just so, AI can help researchers sift through large swaths of data while blockchain provides data integrity and traceability.
AI and blockchain in finance
- Fraud detection and prevention: As touched on above, blockchain maintains an immutable transaction ledger while AI agent clusters can listen for any anomalies.
- AI agents and market predictions: AI influencers are already live and making money. For example, AIXBT’s Twitter account is known for its market predictions, with over 300k followers at the time of this writing. More are sure to follow.
- Credit scoring: AI agent clusters are perfect for analyzing creditworthiness while blockchain provides secure credit history storage. Celsius Network is doing just that.
AI and blockchain in supply chain
- Quality checks and assurance: AI clusters work tirelessly to analyze quality control while blockchain stores an immutable ledger of ongoing results. IBM Food Trust is one such project.
- Carbon footprint management: Calling all sustainable projects! AI can calculate a business’ carbon footprint while blockchain certifies offsets. dClimate does this beautifully.
AI and blockchain in cyber security
- Decentralized identification management: DID is an exciting industry in blockchain. AI comes in to watch for fraudulent activities.
- Ransomware detection: Just so, blockchain stores data securely while AI listens for anomalies by comparing current data against past data. Guardtime provides just such a service.
AI and blockchain in smart cities
- Energy management: AI can predict spikes and troughs while blockchain facilitates energy trading between citizens. Powerledger is well-known for being on the cutting edge of such energy management.
- Traffic management: AI analyzes traffic patterns while blockchain secures communication between smart vehicles and devices. Think of it like Google Maps 2.0. More info from Digital Twin and Blockchain for Smart Cities.
The future looks super
AI and blockchain technology are besties to watch in 2025. They’ve exchanged friendship bracelets and have each other on speed dial. Your business will benefit from their alliance this year with security, scaling, automation and more.
Hop over to our latest report before you make your 2025 superfriends business plan. Among other topics, we cover the ethical concerns you should be aware of, where DePIN is headed, why NFTs may see an unexpected fresh spring, and, of course, what’s on the horizon for AI & blockchain. Read Onchain’s 39 Predictions for 2025.