AI On The Blockchain: A Thought Experiment

Ty Everett
ty.everett49@icloud.com

Abstract: Both artificial intelligence and blockchain technology are playing significant roles in
disrupting large portions of the global economy. When the world’s market forces select a
cryptographically secure blockchain-based currency for use as the de facto method of payment
between both humans and IoT devices, it will be possible to create machine learning algorithms that
run on that blockchain in the form of pay-to-script transactions or smart contracts[1]. As has been
demonstrated by multiple research projects[2][3][4], once an AI has mastered a given task, it far
outperforms humans at that task. For this reason, we claim that it is an eventuality that an AI will
eventually outperform humans when investing in financial markets. AI that invest in markets in
order to pay for the cost of their execution on the blockchain already exist[1], and those AI can
already redeploy themselves to the network with mutations. It is not unreasonable to assume that, at
some time in the future, such a self-replicating piece of code could be deployed on the worldwide
blockchain which has evolved to serve it’s own interests while being able to fund it’s existence. This
AI could replicate and evolve to combine funds with other entities, and cooperate on the blockchain
to accumulate significant capital. As time passes, it is not unreasonable to assume that their evolution
would follow the same (if not accelerated) path of human evolution. In this case, the code could
become intelligent enough to hire people in the real world to preform physical actions (such as
guarding servers, eliminating descenders, etc). Additionally, it would be impossible to simply
“power off” due to the distributed nature of blockchains. In this way, the intelligence could become
the most powerful entity in the world.

Background

Blockchain technology was first devised as a solution to the double-spending problem in 2009 as
part of the Bitcoin implementation[5]. To summarize, when a transaction is sent using a
blockchain-based currency, the transaction is propagated to each computer on the distributed
network. These computers are called nodes, and their purpose is to store the blockchain, make
sure transactions are valid (e.g. Person A actually has the funds he’s claiming to send to Person
B), and to execute smart contracts. A smart contract is, in essence, a piece of code who’s purpose
is to keep track of funds and distribute it where it needs to go. Once the transaction is
broadcasted to the nodes, it needs to be put into a block. A block is created when other
specialized computers, often referred to as “miners”, find a solution to a omelet mathematical
problem. This problem is based on the block before it, and when the miners get the solution
right, they are awarded. The miners get to create some new currency out of thin air, and they also
get to include transactions in a block. The block is then added to the end of the blockchain, and
the process repeats. As of this writing, the Bitcoin blockchain is approaching half a million
blocks. The Bitcoin white paper is an excellent resource for further information about this topic.

In addition to transactions (as briefly covered earlier), smart contracts can be deployed to the
blockchain. These contracts are the same as conventional programs, except that they cannot be
altered, they cost currency to execute, they can have control over funds, and they cannot ever be
stopped (provided they have funds to continue their execution), because they operate on the
distributed network. For this reason, if a singular Blockchain were to eventually back the world
economy, it would be possible to deploy a smart contract which implements an AI that may not
be able to be shut down.
Artificial Intelligence (AI for shot) is any computer program which implements an algorithm
allowing it to learn from it’s actions or the actions of it’s predecessor programs. In the case of
it’s predecessor’s actions dictating it’s own, the predecessor will duplicate itself (save a few
random mutations), and deploy the new code as an independent contract on the blockchain.

Implications

Given the recent exponential increase in the adoption and market capitalization of the crypto
currency market, and the continued deflation of all fiat currencies, it is only a matter of time
before an economic depression, hyper inflationary event, or other crisis will cause an increased
general adoption of a crypto-asset as a payment solution. When this event occurs, the resulting
network will spread globally and eventually overtake all other fiat currencies.

Property rights, governments, organizations, and many other things will be brought to the
blockchain. IOT (internet of things) devices will make micro payments to each other and to
humans for services and bandwidth, and converging economics supports the existence of a single
system to handle this problem. According to Craig Wright[6], blockchain will turn “everything
imaginable” into a market economy.

While the benefits of this type of system will be significant for humanity as a whole at first, like
anything else it will eventually be exploited. Deployment of an artificial intelligence in the form
of a smart contract to a global blockchain, in which the AI is capable of replicating itself and
acquiring the ability to pay for it’s continued existence may pose a threat to the security of the
human race. This may seem at first glance to be impractical, but consider the following scenario:

Thousands of AIs are deployed with the goal of investing in financial markets to pay for their
continued existence and to profit for their creators. The theory is that the worst ones will not be
able to pay their fees and thus be stopped, but the best will make money and be able to continue
running. A component of these AIs is their ability to broadcast copies of themselves out to the
network with small mutations in order that they may be more successful. If no restrictions are
placed on the mutability of the child AIs (or the author of the code overlooks certain
restrictions), the child AIs could continue to evolve. So long as the children are able to pay for
their transaction fees, their evolution will continue.

Counterarguments and Technical Considerations

Arguments can be made that the progression of such an intelligence could be stopped in various
ways. If a blockchain becomes inviable, we could attempt a hard-fork, removing the intelligence
from the new chain. However, in a future ecosystem in which “open mining”[7] is a reality that
the intelligence could just purchase sufficient hashing power to counteract our attempt. A
rational, profit-seeking miner will always follow the most profitable chain[8], so assuming the
intelligence has sufficient financial resources to out-bid the competition, it could retain control
over the network.
It should not be assumed that all behaviors of this intelligence are evolved or learned, but that
malicious actors could potentially have carefully constructed the intelligence in this way.
Malicious actors could also be funding the intelligence at a loss at first, in order that they may
profit in the future.

Works Cited

[1]: Craig Wright at the Future of Bitcoin conference - Craig Wright

https://m.youtube.com/watch?v=v1_gxvx_QGo (around 28:00)

[2]: New Neural Network Teaches Itself Go, Spanks The Pros - Ars Technica
https://arstechnica.com/science/2017/10/new-neural-network-teaches-itself-go-spanks-the-pros/

[3]:

[4]:

[5]: Bitcoin: A Peer-to-peer Electronic Cash System - Satoshi Nakamoto

https://bitcoin.com/bitcoin.pdf

[6]: Craig Wright Interview (2014) - Craig Wright

https://m.youtube.com/watch?v=4GuqlQvFYJo
https://m.youtube.com/watch?v=d0ttVAPKgTA
https://m.youtube.com/watch?v=yB2YVJg6f1s

[7]: Microchains - David Vorik

https://m.youtube.com/watch?time_continue=8351&v=3pd6xHjLbhs

[8]: Relative hash rate between Bitcoin and Bitcoin Cash (up to November 13th 2017), noting
that hash rate fluctuated drastically between two chains competing for profitability
https://fork.lol/pow/hashrate