Artificial Intelligence versus Crypto: Is SEC Chair Gensler in the right?

Cryptocurrencies were all the fuss until last year, but the decline in digital assets' value combined with the collapse of crypto companies led to a drop in people's interest. Come 2023, the rising interest in Artificial Intelligence is taking over the crypto market, and at the moment, it has become the biggest topic of discussion, just as crypto once was back in 2021

How AI became the talk of the town

Artificial Intelligence (AI) first came to prominence after the emergence of ChatGPT. The AI chatbot triggered the discourse of this technology's supremacy and how its use cases could make way for easing up workflow. 

But ChatGPT also triggered a natural competition as big tech companies jumped to claim control of this field. The likes of Microsoft, Google and Amazon all launched their own chatbots that furthered the AI hype.

One of the crypto market's biggest objectors, Gary Gensler, the Chair of the Securities and Exchange Commission (SEC), submitted his take on the AI vs. crypto narrative.

During his testimony before Congress on April 18, the regulatory body's head stated that Artificial Intelligence is the transformative technology right now and not crypto. He further shared his contempt for the digital asset market, saying,

"It’s not a matter of lack of clarity, I think this is a field that ... has built up around non-compliance and that's their business model.

Is Gary Gensler's attack on crypto agreed upon?

While Gary Gensler's comments came in the second quarter of this year, many notable crypto influencers have shared their opinion before. One of them is the DOGE father Elon Musk, who stated last month that his interest is shifting from crypto to AI.

Crypto exchange Binance's CEO Changpeng Zhao (aka CZ) considers crypto and AI could go hand in hand. During an ask me anything (AMA) session on Twitter last month, the executive, upon being asked about the application of AI in 2023 with respect to crypto, stated,

"Binance has been using AI in our products in a few areas…You can interact with AI, and if you ask for something, the AI will try to give you a response. So that's the most recent one.

The impact of AI has been significant on the crypto market, too, so much so that in the last few weeks, AI tokens have begun fielding the most funding from investors. The likes of The Graph Token (GRT), Render Token (RNDR), SingularityNET (AGIX) etc., have seen stellar growth and continue to.

Although according to analyst Alex Valaitis, both crypto and AI have a common thread, data, as the former attempts to decentralize it while the latter aims to centralize it and use it to train computer systems. He noted that while each of them differed in incentives, they could be used to solve the problems that may arrive out of excessive use of either of them.

But when it comes down to whether crypto holds power or AI, it becomes clear that neither has it at the moment. Thus, Balaji Srinivasan's $1 million Bitcoin bet could mostly fail. Not in terms of BTC reaching that price point by the second quarter of 2023 but in terms of the ideology that Bitcoin would become the most in-demand asset as people recognize crypto's value.