Microsoft sees artificial intelligence (AI) as the most significant technology of our time and has been actively involved in AI research and investment. However, the company also recognizes the potential synergy between blockchain technology and AI. Yorke Rhodes, Microsoft’s director for digital transformation, blockchain, and cloud supply chain, stated that as these two technologies progress, agents can be created to combine their power. Microsoft’s current focus is on optimizing existing technologies like layer-2 blockchain rollups.
During a panel discussion at the Cornell Blockchain Conference, Rhodes was asked whether Microsoft would have its own blockchain in the future. He responded by highlighting the interesting developments happening in the crypto space, particularly in the open-source community. Instead of trying to recreate something that already has significant investment, Microsoft is more focused on enhancing existing technologies.
The panelists at the conference discussed the relationship between crypto and AI. Matt Stephenson, head of research at Pantera, suggested that crypto could play a supportive role in certain types of AI, especially transformer and diffusion models. However, Rhodes acknowledged that AI tends to dominate the conversation and attention, leaving little room for other emerging technologies like crypto and blockchain.
The discussion also touched on the challenges associated with decentralized networks. While decentralized networks offer advantages like reduced communication overhead, they can suffer from latency issues. However, Jasper Zhang, CEO and co-founder at Hyperbolic Labs, expressed confidence that inference is possible on decentralized networks.
Rhodes mentioned that there is a growing trend in developing smaller language models that run efficiently on phones and laptops. Microsoft has been working on small language AI models that require less training data and computational power.
The panelists also discussed the regulatory landscape for AI. While the United States has been criticized for its approach to regulating cryptocurrencies, Neil DeSilva, chief financial officer at PayPal Digital Currencies, defended the U.S., stating that there is a lot of innovation happening in the country. However, DeSilva also acknowledged that other jurisdictions like the European Union are becoming more welcoming to stablecoin issuers, and the U.S. needs to keep up with the pace.
Regulating AI poses its own challenges, particularly due to its opaque decision-making process. Blockchain technology, with its transparency and tracking capabilities, could potentially address some of these challenges.
The discussion concluded with the panelists sharing their visions for the future of AI. Zhang predicted that AI would become powerful enough for every company to become an AI company. Rhodes mentioned that fully homomorphic encryption (FHE) could solve privacy problems, especially in industries like healthcare. DeSilva emphasized the importance of optimism in the tech industry and expressed confidence that computing frameworks would continue to improve.
Overall, Microsoft recognizes the potential of blockchain technology and AI, and while AI currently dominates the conversation, the company remains committed to optimizing existing technologies and exploring the intersection between AI and blockchain.