Decentralized AI and Blockchain

Decentralized AI and Blockchain

With the rising popularity of AI and blockchain technologies, ever wondered how both can be integrated and used for improving the operations of companies? Find out more about each of these...

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AI and blockchain can comfortably be called the industries of tomorrow. In fact, they have been called just that for a while now. Both these technologies are this decades’ most innovative breakthroughs – AI technology helps machines to support humans in routine and non-routine tasks and blockchain technology enables secure and tamper-proof transactions.

Walk through this article to explore what artificial intelligence is, understand blockchain and how the two contrasting technologies when combined tactically make lives easier for several industries. You will also see some blockchain and AI examples which show how the use of blockchain improves AI.

What is Artificial Intelligence?

You must have heard the term AI being thrown around so commonly these days, be it in association with machine learning, about AI use cases, how AI is being adopted in multiple fields and the most recent development, everyone’s favorite ChatGPT! So what is “Artificial Intelligence”? 

Simply put, artificial intelligence is a kind of computer technology that is used to perform tasks which are traditionally performed by humans. It can range from interpreting patterns in complex datasets and analyzing the same for decision making purposes to something as simple as playing online games against people. 

Most AI systems are designed to be so smart that they learn and keep updating on their own and do not require human intervention very often for their functioning!

What is Decentralized AI?

Decentralized AI, or distributed AI, is an approach to artificial intelligence that involves the distribution of AI computation and decision-making across multiple nodes or devices. Unlike traditional centralized AI systems, where all the computation is performed on a central server or cloud, decentralized AI leverages the collective power of a network of devices, allowing for greater scalability, privacy, and resilience.

How does Decentralized AI Work? 

In a decentralized AI setup, each node in the network contributes its computational resources, such as processing power and data, to collectively train models and make predictions. This collaborative approach enables the development of intelligent systems that are not reliant on a single point of failure and can operate in a peer-to-peer manner.

What Issues are solved by Decentralized AI?

Now that we know ‘what is decentralized AI?’ and ‘how does decentralized AI work?’, let’s see which issues it solves. Decentralized AI has the potential to solve several critical issues associated with traditional centralized AI systems. 

  • One of the most significant problems is data privacy, which decentralized AI addresses by distributing data across multiple nodes. This ensures that no single entity has complete access to the information, thereby enhancing data privacy. 
  • Additionally, decentralized AI can handle large-scale datasets and computationally intensive tasks efficiently by leveraging the power of distributed computing. This approach enables faster and more efficient processing of complex AI algorithms. 
  • Furthermore, decentralized AI promotes greater transparency and trust by creating transparent and auditable models where multiple nodes can trace and validate the decision-making process.

Why is Decentralized AI Important?

Decentralized AI is becoming increasingly important in the tech world, for reasons such as:

  • It enhances data privacy and security by distributing data across multiple nodes, reducing the risk of compromised datasets. This is especially essential in sensitive domains such as healthcare, finance, and personal information. 
  • Additionally, decentralized AI fosters innovation and collaboration by enabling peer-to-peer interactions and resource sharing. This approach can accelerate the development of AI models and unlock new possibilities for solving complex problems. 
  • Moreover, it promotes fairness and inclusivity by empowering individuals and smaller organizations to participate in AI development and decision-making. Decentralized AI addresses critical problems while promoting innovation, collaboration, fairness, and inclusivity.

What is Blockchain?

Now that you know briefly what artificial intelligence is, let us move on to explain blockchain to you.

Blockchain can be understood as a distributed ledger technology in which each incoming transaction is shared among the nodes of the network. 

With new data added to the blockchain network, the nodes validate the authenticity of that data based on a consensus mechanism. It helps to maintain a secure, transparent and decentralized record of transactions. Blockchain is most famous for being used in cryptocurrency but today it has several use cases across different industries.

Blockchain vs. Artificial Intelligence 

You have seen what blockchain is and what artificial intelligence is separately. You should also know that both blockchain and AI complement each other in many areas and make modern systems more transparent, safe and efficient. 

While the AI algorithms are used for processing data and automating different tasks, blockchain is used to make those tasks more efficient and secure by providing a transparent mechanism of storing data. While AI enables smart contracts to be created, blockchain allows the recording of these smart contracts. 

Blockchain and AI have their own differences as well; while blockchain is vulnerable to security frauds and scams, AI algorithms cannot be trusted blindly as you can see them firing back in some cases. 

Use Cases for Blockchain and AI

AI and blockchain can be used in conjunction to fix the individual gaps in each technology. Let us discuss some blockchain and AI use cases in different fields and see some blockchain and AI examples: 

1. Healthcare

You can see blockchain technology being used by many clinics and hospitals today for securely storing patient data so that no one can tamper with it. A medical organization ensures privacy of the patients by using blockchain to maintain electronic health records. If AI is combined with this, then the processes in a hospital can become really efficient. AI can be used for analysis of patient data and for drawing meaningful insights from it. It can help in recommending the list of possibilities in a patient’s condition and aid in treatment suggestions.

2. Life Sciences

AI and blockchain can do wonders in the pharma industry as well. Blockchain and AI examples in the field of life sciences include making the drug supply chain more visible and traceable. AI can perform advanced data analysis while blockchain provides a decentralized framework for clinical trials.

AI and blockchain also increases the success rate of these clinical trials and facilitates data integrity. If you come across a lab that uses AI and blockchain in its processes, you will notice how easily and quickly they can track patients and their drug requirements and even collect further data, all in an automated way.

3. Financial Services

AI and blockchain are transforming the banking and financial services industry by bringinging trust among the various stakeholders involved. Together they eliminate friction from multiparty transactions while increasing the speed and accuracy of transactions.

Let us take the example of a loan process. The personal records of the loan applicant are in the digital form on the blockchain and they give the access of these records to banks for the purpose of due diligence. The overall experience of customers gets improved by the trust in the data and speedy evaluation of the records as a result of automation of processing systems.

4. Supply Chain

The supply chain industry is another name in the list of sectors that are being transformed by AI and blockchain. You will see logistic firms enjoying the benefits of shifting their entire processes which were earlier paper based to the digital mode. This makes the data easily shareable and accessible by the concerned parties. 

Even the execution of transactions has now been automated which creates new opportunities for such firms. Now with the help of AI, manufacturers can also track the data on carbon emissions and discern from which level it is being created the most.


To sum up, AI and blockchain have individual values which when combined together, delivers several new opportunities across industries. We saw what is artificial intelligence, what is blockchain and how AI when fitted into blockchain has many use cases. We saw some AI and blockchain examples that showcased that when the two technologies are used smartly in conjunction, despite their differences and flaws, they are able to resolve blockages in existing systems.

With almost every company looking for ways to enhance their operations and customer experience by automating tasks, the intersection of AI and blockchain in different areas is expected to only expand in the near future!

Frequently Asked Questions (FAQs) 

1. What is the Role of AI in Blockchain?

Blockchain simply provides a decentralized platform for recording data and it is expensive to store data on blockchain. If you merge AI in blockchain, then decentralized AI applications and algorithms are created. 

This decentralized AI system will help you in getting different findings and processing these findings independently across different devices and will help you in finding fresh solutions to problems. With AI in blockchain, you will get the support of autonomous coordination and data analysis which will help you in the decision making process.

2. How can Blockchain and AI be used Together?

AI and blockchain when combined provide wonderful use cases in enhancing everything from the functioning of supply chains to financial services and healthcare.

While AI can be used to mine through large amounts of data in an efficient way and explore new patterns as per the behavior of data, blockchain can be used to remove bugs and spam data.

By using these two technologies together, you can establish new patterns and classifiers through the use of AI and validate them on a decentralized blockchain platform.

3. Is Artificial Intelligence Related to Blockchain?

Artificial intelligence, AI and blockchain are two distinct technologies that have their own uses and places in which they are applied. You will see blockchain being used most widely in cryptocurrencies while AI can be seen commonly, even replacing the need for humans in some routine jobs like cleaning and organizing.

However both these technologies do have certain areas of intersection like transparency, security, privacy, authenticity, efficiency etc. Although both are not directly related to each other, integration of AI in blockchain can create new opportunities for companies and help them to solve certain efficiency related problems.

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