AI is Artificial Abundance, Crypto is Artificial Scarcity

Cryptography proves ownership, secures your information, constrains access: not your keys, not your data. Digital scarcity.

AI relies on free, open access to data for its training, allowing it to create a content deluge. Digital abundance.

These two are so poetically at odds I can’t help but view them as competing Darwinian forces. In fact, I think these technologies are evolutionary extensions of human cognition. They should be viewed similar to competing forces in a biological organism, they contrast each other to create a kind of digital homeostasis. Similar to how the body has manifold mechanisms in it to maintain equilibrium, even in the presence of extremes. It's too serendipitous that they both happen to be at the same gestation levels developmentally (roughly).

I came across a thought that predicted people will one day seek out content untainted by AI in the same way that steel is salvaged from shipwrecks that’s untainted from nuclear fallout.

Meaning eventually there will be such an overabundance and saturation of AI-generated content that pure human creations will be seen as antiques, a sort of content collectible. A rare genuine expression from a quaint time when producing content was an involved, thoughtful act, made more valuable by its imperfections.

I think a variation of this will happen, the same way people love vinyl albums when an MP3 is more convenient. We’re nostalgic creatures.

Large language models (LLMs) will eventually exist in a feedback loop of sorts where the majority of data they’re trained on was itself generated by other LLMs. Training LLMs on the outputs of other LLMs feels like a cycle destined for predictable, factory-made, rote, bland content. The internet will be positively swimming in it.

AI is artificial abundance.

The value that we ascribe to many things is the amount of time and effort someone put into making it (known as the Labor Perception Bias). This doesn’t apply to all goods obviously, however for creative output it’s where a lot of the value comes from.

Art and writing are two domains where much of the perceived value stems from appreciation that someone dedicated time and creative effort making it. You appreciate hand-crafted stitching and hand-drawn masterpieces more than a paint-by-number-style screenprint churned off a factory floor, even if they’re both visually similar.

AI will dilute this signal. It will saturate us in mediocre content that’s mostly similar to the creative content it’s been trained on. It will make it nearly impossible for humans to perceive the amount of effort or creative energy that went into something.

If everyone has access to the same LLMs, then there is no competitive advantage using LLMs. It becomes something of a baseline where you need it to compete, but your unique abilities are still the things that shine through.

Imagine if it was a requirement that every NBA player used steroids, and they all used the same drugs in the same quantities. What would happen? Everyone’s athletic abilities would increase, but the idiosyncratic talents of players would still be the differentiating factor. If everyone stands on a 6-inch block, then everyone is 6 inches taller; you are not competitively advantaged by it.

You can’t juice your way to Steph Curry’s jumpshot. Take as many steroids as you want, you won’t be able to see the court and pass like Steven Nash. No performance-enhancers will give you Tom Brady’s brain.

This means that unusual, original creators will become more prominent, especially if the creator can prove he made it ‘by hand’ (metaphorically). The mediocre creator is in trouble, the exceptional one will be amplified.

Crypto is artificial scarcity.

There’s a well-known take that “AI is communist, crypto is libertarian”. It may not make sense if taken literally; what it functionally means is these two technologies provide a symbiotic yin-yang to each other via their contrasting strengths. The tech equivalent of “unstoppable force meets immovable object”.

There is no physics rule or law of nature why bitcoin is capped at 21 million. With a tweak of some code we can modify the amount of Ethereum in existence to trillions. You cannot do these things with gold or items that exist in the world of atoms. But in the world of bits you can, so what constrains it?

The artificial scarcity that cryptography brings to the financial world through DeFi can be abstracted onto human creations. Human-made output can be proven as anthropogenic and original, allowing content to be verifiably linked to its creators.

For example: creators could ‘stake’ their reputation or cryptographically sign content as their own. Just how we stake ETH to secure Ethereum, a creator could stake a tokenized form of his reputation (an NFT, tokens that come from a known wallet of his, etc.) behind content he produces, claims he makes, or anything that he wants to be identified with.

Like signing an onchain transaction, people with creative uniqueness could ‘sign’ their output with a PGP or ECDSA-style signature to confirm its provenance. This is already commonplace on the dark web and DeFi, and it will become standard practice for all unique output someday to help us navigate the AI downpour.

AI will flood the world with ordinariness. Most people will not be able to differentiate themselves in this sea of mediocrity, because definitionally most people are mediocre. Digital abundance.

Crypto will act as a ship atop these extremely mid waves. Cryptography facilitates proof of origination, permitting us to readily discern and verify content and claims as authentic. A compass to navigate the AI deluge. Digital scarcity.

Follow at @BackTheBunny

Check out another popular post --> The Great Rebundling: Crypto & Human Communication’s Natural State

7 thoughts on “AI is Artificial Abundance, Crypto is Artificial Scarcity

  1. Do you mind if I quote a couple of your articles as long asI provide credit and sources back to your website?My blog site is in the very same niche as yours and my users would certainly benefit from some of the information you present here.Please let me know if this okay with you. Thanks!

    1. hey there 🙂 appreciate you asking. yes you can go ahead and quote it in your blog. just please be sure to link to the article and attribute it to the blog.

      if you can also attribute it to @BackTheBunny on twitter too that’d be great (profile here: https://twitter.com/BackTheBunny). I post all the blog posts on there as well.

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