Blockchain adoption lags behind AI adoption by a huge margin. 

There are 300million blockchain users globally and 85million people with blockchain wallets. In contrast, OpenAI alone reached 100 million ChatGPT users in 3 months and 55% of Americans regularly interact with AI.

The blockchain market is predicted to reach $32.69 billion in 2024, while AI is worth an estimated $454.12 billion, a 10x. 

User adoption drives financial valuation for tech companies. This is evident in almost every pitch deck and the new wave of AI startups springing up. So why do blockchain-powered solutions inhibit user adoption while AI-powered solutions foster it?

William Anderson highlighted the absence of foundational building blocks, the lack of product focus, and the challenge of reaching mainstream users as the hurdles holding blockchain back from mass adoption.

But why? 

From my personal experience, there are 3 reasons I’ve found:

1. Misaligned Decentralisation Incentives

Decentralisation is one of the fundamental principles of Blockchain technology. Individuals have more ownership and control of digital assets without the need to trust a central authority or middleman. Instead of a few organisations making decisions that affect all users, individuals or small groups become authorities.

This means hundreds of thousands of individuals are incentivised to make decisions that favour themselves only, even if it requires competing with everyone else or being destructive.

This has plagued cryptocurrencies, and NFTs, and is equally responsible for increasing fraudulent activities, rug pulls (scam projects) and hacks of various sizes.

In contrast with AI, a few centralised entities or organisations are competing to deliver useful products and solutions. They rely on a value-driven approach to gain a competitive advantage. 

I believe decentralisation has merits, however, it inhibits mass adoption if self-custody continues to be a risk to the average user.

 2. Rewarding Early Adopters Only

‘We’re early’ is a common phrase in the blockchain world. This is ‘the space’ where the early bird catches the worm. If you’re not early, you’ll most likely be dumped on or be left carrying a bag. 

For example, early purchasers of cryptocurrencies are more likely to be ROI positive even in a downturn than late entrants who are much more likely to lose. Early users of new protocols and products have the advantage of getting free airdrops that can be monetised through scarcity. As more people adopt the protocol, less financial incentives become available. 

There is a constant influx of new, complicated and hard-to-use solutions, that can be dumped on late entrants. waiting for late entrants to be dumped on.

AI solutions on the other hand favour continuous product usage that informs product improvements. Late users get better products, the network effect increases, and early adopters may be rewarded but not at the expense of laggards.

3. Unending Learning Curve

I use blockchain-powered and AI-powered solutions but I still find myself constantly playing catchup with blockchain.

Here’s my Blockchain Journey

• I started actively showing interest in blockchain in 2021 and became active on Crypto Twitter (CT)
• Minted multiple NFTs (many of which went to zero 😀)
• Joined many communities on Discord and became a Moderator for TIMEPieces , TIME Magazine’s web3 community.
• Launched my book, Passionless as an NFT on the Ethereum blockchain
• Interviewed some of the largest blockchain service providers for my Masters research.
• Completed a 53-page MSc dissertation on blockchain adoption in Supply Chain. 
• Guest lectured about NFTs and Web3 at Birkbeck, University of London for undergraduate and postgraduate students. 
• I use a hardware wallet but am still scared of clicking a link that could drain my wallet. 
• Endured sleepless nights refreshing webpages to mint NFTs. On one particular occasion, I watched as users spent over $100,000,000 (100 million dollars) in gas (transaction) fees in a single night to mint an NFT collection. 
• I’ve used L1s, L2s, and recently an L3, interacting with multiple chains. 

With this level of knowledge and active involvement, I still feel that I’m behind when it comes to using blockchain. For example, 

• Ordinals (Bitcoin NFTs) launched in 2023. Many existing and active blockchain users, including me, didn’t understand it or dedicate time to learning. In CT terms, we ‘faded’ generational wealth 😂
• In a few days, Bitcoin reward halving is happening. A new protocol called Runes, which would allow fungible tokens (meme coins) on the Bitcoin blockchain will be launched on block 840,000. In order not to ‘fade’ this new opportunity, the general advice is to run your own Bitcoin node 😳.

Phew! It is endless.

Ovie F. former Wall Street Trader turned Crypto artist and Steve Kaczynski, author of “The Everything Token: How NFTs and Web3 Will Transform the Way We Buy, Sell, and Create” share the same frustration at the amount of new things to learn in this X, formerly known as Twitter, exchange.

The story is different for AI. 

• I opened a free ChatGPT account and used it. I was wowed. I even predicted it would be a challenger to Google Search before Microsoft Bing’s integration. I eventually upgraded to ChatGPT Plus. 
• I’ve used AI in other tools for marketing automation, graphics design, video editing to achieve better results while saving time.
• I have a good knowledge about how LLMs work but that knowledge isn’t required to leverage the benefits of AI. 

This week, I’ve been learning about Stagwell‘s Stagwell Marketing Cloud solutions from Elspeth Rollert, Lindsay Hong 洪傅琳熙 and Jason Brandt. In 30 minutes, I felt I could jump into the tools and start using them.

What Next?

When will blockchain become a usable technology that drives user adoption? I am not sure. 

However, I am clear on this – the convergence of AI and Blockchain technologies will power the next evolution of the web. 

Maybe, blockchain is the backend that’ll enable authenticity and trust in a world where AI takes over at the front. 

Alex Ohanian puts it like this:

It's my theory that the age of AI and the ascendence of blockchain technology are about to collide and reinforce each other 💥

Why?

One is creating the indisputable need for the other.

Right now, AI is creating a world that will make images infinitely available. We will see a…

— Alexis Ohanian 🇦🇲 (@alexisohanian) April 11, 2024