Crypto investment magnate Barry Silbert predicts explosive growth for decentralized AI, calling it ‘the next big era of crypto’ that could be bigger than even bitcoin.
Decentralized AI Opportunity Is ‘Bigger than Bitcoin,’ Says DCG’s Barry Silbert
Crypto investment magnate Barry Silbert is betting big on decentralized AI, calling it ‘the next big era of crypto’ that could be bigger than even bitcoin.
Barry Silbert is a renowned entrepreneur and investor in the fintech industry.
He co-founded Second Market, a platform for buying and selling private company stock, and was also involved in the development of the Bitcoin Investment Trust (BIT).
Silbert has been a vocal advocate for cryptocurrency adoption and has invested in various blockchain-based startups.
As the founder of The Cryptocurrency Data, he provides insights on the cryptocurrency market.
His entrepreneurial ventures have made significant contributions to the growth of the fintech sector.
The Rise of Decentralized AI
Silbert believes the tech mashup may pay better dividends for humanity than the closed-off systems being developed by OpenAI and other giants. He writes, ‘We’re moving from the digital ownership of assets to the decentralized ownership of intelligence and the availability of vast decentralized compute resources.‘ This setup reminds him of bitcoin, the best-known and biggest cryptocurrency, where he first made his crypto fortune.
Decentralized AI refers to a type of artificial intelligence that operates on a decentralized network, allowing for greater autonomy and flexibility.
This approach enables AI systems to make decisions independently, without relying on a central authority.
Decentralized AI is built using blockchain technology, which provides a secure and transparent environment for data processing and decision-making.
According to a report by MarketsandMarkets, the decentralized AI market is expected to reach $13.95 billion by 2025, growing at a CAGR of 39.6%.
This technology has applications in areas such as smart cities, autonomous vehicles, and 'healthcare.'
A Power Revolution
However, instead of a money revolution, deAI could herald a power revolution with crypto as the mechanism to distribute ownership of and governance over powerful AI models. DCG certainly thinks so, having already invested $105 million into over a dozen deAI projects. Silbert writes, ‘and we’re excited to ramp this up in 2025.‘
Bittensor: A Key Player
DCG’s investment in Bittensor – a crypto network that specializes in machine learning and AI applications – is highlighted as the portfolio company closest to ‘escape velocity.’ Bittensor’s TAO token has many similarities to bitcoin, with a market cap of $2.7 billion compared to bitcoin’s nearly $2 trillion valuation.
Bittensor is a decentralized, open-source protocol that enables the discovery and transfer of knowledge between artificial intelligence (AI) models.
It facilitates the creation of a global knowledge graph, allowing AI models to share and leverage each other's expertise.
Bittensor uses blockchain technology to secure and verify the knowledge exchange process.
Supporting the Ecosystem
DCG plans to invest mightily in supporting the Bittensor ecosystem. Silbert points out that in November, it spun up a company called Yuma that incubates Bittensor infrastructure projects. Grayscale, another DCG company, now offers investment products that give exposure to TAO.
A Year of Rebuilding
Silbert’s Q4 letter caps a year of ‘rebuilding’ at DCG after the tumultuous period spawned by the FTX implosion, which felled its lending business, Genesis. Despite this, all five of DCG’s wings had a ‘successful 2024,’ he says. The discipline required over the last couple of years has resulted in enhanced infrastructure and more mature processes, improved governance, and a stronger organization focused on executing on their growth initiatives.
