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AI’s rise has taken the world by storm and with AI applications such as ChatGPT we are moving towards a new age of blockchain-based smart contracts. The all-around development in technology will change the way industries work and will improve efficiency, automation, development, and ease of use for contracts.
Cryptocurrencies like Bitcoin and Ethereum powered by Blockchain’s decentralized ledger have gained a lot of popularity because of their extreme ability to provide transparency and promote trust among users. Simultaneous to this, Machine learning and natural language processing are two areas where Artificial Intelligence has made significant development. Both these along with AIs development carry the power to improve the functioning of the Blockchain network and smart contract execution.
AI in Blockchain Network
Blockchain networks are completely decentralized and they ensure no point of control or failure. Although decentralization has the ability to bolster security, efficiency and scalability are still challenges. AI in this field is ready to enhance data processing and storage on the blockchain. Because of Blockchain’s widespread and heavy usage, sluggish transaction speed is one of its drawbacks in comparison to traditional Media but AI here can help by processing the payments faster, reducing transaction times, enabling seamless user experience, and improving confirmation time. AI can help the blockchain network maintain peak performance by recognising and identifying network congestion patterns
AI also helps in the prevention and detection of fraudulent activities happening in the blockchain network. Machine learning (ML) algorithms can suspect malicious behavior by analyzing the transaction data in the network and highly enabled security approach and detect potential red flags and improve the network’s trustworthiness. Artificial Intelligence elevates smart contract execution
Smart Contract Execution with AI
Smart Contracts aren’t exactly Smart Contracts according to their name, they are basically agreements encoded in a Blockchain input as codes that can self-execute and automatically execute themselves when a set of predetermined conditions are met. Unlike traditional contracts, smart contracts offer transparency, are tamper proof, and are cost-effective. Although Smart Contracts have a lot of advantages over traditional ones they cannot adapt easily to the ever-changing circumstances and this is where AI steps in and plays its role to enhance the execution and functionality of smart contracts.
Improvement in Smart Contracts
Most of the problems that Smart Contracts face are because of their rigid and inflexible design which can now be adjusted with the help of AI. AI has the ability to make smart contracts and adapt quickly to whatever conditions or new information arises. Artificial Intelligence and Machine learning algorithms can help in upgrading contract terms based on the current market conditions and asset performance. Inserting AI in Smart Contracts makes them more responsive and better cater to the needs of the parties.
Dispute Resolution in Smart Contracts
Many problems such as disputes between parties, misunderstandings in contracts, and errors rise but with Artificial Intelligence things can become much smoother. AI can improve the dispute resolution process, evaluate and execute smart contract terms on its own and resolve the issues before contract execution takes place.
Future Ahead with AI
The Impact of AI on the blockchain can be highly beneficial in the coming years as it is making the smart contract ecosystem much smoother and hassle-free. With the combined potential of Artificial Intelligence and Blockchain a lot of developments can take place in both industries and it can improve users’ experience extensively.
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
