AI And Crypto: Capturing Value In A World Without Revenues

Good day everybody, Taskmaster4450 here, putting together another video for everyone, and what I am going to discuss today is a continuation of what I've been talking about, writing about, and it's something that I feel is just an extremely vital part of what's taking place. I think AI is moving towards a breakthrough moment, generative AI, and by the end of the year we are going to be even more impressed by what we see as compared to today. I've said this, that I think the next generation of large language models are going to really be much further advanced than they are now, and that we're heading towards the knee of the exponential curve. People say it's in a hype cycle, maybe it is, people talk about bubbles, that's bringing the financial component in, maybe it is, I don't know, but I think we've got some serious stuff going on with this technology, and we're going to see a huge leap forward in the next four months or so. So what does this have to do with crypto? Well my overriding theory is simply this. Crypto is the value capture in a demonetized world, and what I mean by that is the trend in technology is deflationary. Tony Siba talks about the push towards zero, Peter Diamandis uses the term demonetization, and we've seen this throughout the last 40 years. You can look at long distance phone service, you can look at entertainment, you can look at all the different things that you consider, and most people don't consider because they see the price of Netflix going up, and it goes from let's say $12 to $15. They don't realize that back in the 1980s, three video rentals was like $20, I mean five video rentals was like $20, $18, something like that. It was like three or four bucks per movie. And so when we look at what's taking place with generative AI, and I've talked about this with image generation, where I can go and prompt an image in a matter of seconds for free, that would have cost hundreds of dollars 30 years ago, 25 years ago, would have had to hire a graphic artist, design it, draw it, all kinds of stuff. That's demonetization. That's a deflationary move. And as the tentacles spread, we see huge shifts taking place. But see, just because there isn't the monetary component doesn't mean there's not value. Let's take long distance service. It was 20 years ago where people got long distance bills. So you get your phone bill, even mobile phones had long distance, it wasn't free to call outside your calling area. So you would have a long distance charge, and it was based on a permit, 15 cents, 10 cents per minute, something like that. So you talk for an hour, it costs you like six bucks. And that was how you had the ability to communicate with people who weren't local. Now let's take communication today. How many different ways can we communicate with people all over the world? Just think about that. You have all kinds of instant messengers. You have phone service. Okay, maybe for your phone service, it costs money to call internationally, but most countries doesn't cost money for within the country. There's social media applications. You can communicate in so many different ways, basically for free. And this is one of the reasons why I say GDP is an outdated metric. But again, coming back to the fact that even though it's free, that doesn't mean it's valueless, that there's no value. And when we start getting into generative AI, and it starts to drive basically the cost of knowledge down, that's essentially what it does. I mean, you can go to a chatbot, not even paying, you can go to Lama 3.1, you can go to Claude, you can go to Grok, both with a Q and a K, you can go to a bunch of them, OpenAI, ChatGPT. And you can prompt in most anything and get a reply. Now, it's not 100% accurate. But then again, neither is asking an expert in the field, whatever field it is. Go ask the doctor questions about what's in the medical books. For the most part, they won't have any idea. And as I said, my view of things is that next generation is going to be significantly improved. So the accuracy, the hallucinations will be reduced, they're not going to be eliminated. I don't think hallucinations will ever be eliminated. But they will be reduced. And so how do we capture this value when revenues, when profits are removed from the equation? Well, most times we just ignored it. See, this is where people get the inflation, what they call inflation, the CPI all bungled up. Oh, well, the purchase in power of the dollar is going down. Oh, yeah? How? Well, look at CPI. Oh, yeah. Well, let's price it in long distance communications. Let's price it in semiconductors. Let's price it in music, video. How about photography? How many pictures can you get for a dollar today compared to what you could get 40 years ago? How about commercial real estate in most major cities? Have you seen what happens to that? And that's a technological deflation. Zoom and the Internet killed that. Hollywood. And now you have generative AI, image creation, text creation. And soon, within the next 18 to 24 months is my guess, video generation. We create over 2 trillion photos globally every year. And 99.999% of them are for free. We also have the ability to share them in hundreds and hundreds and hundreds of ways. You can text them, you can send instant messages, you can email it, you can post it on Instagram, you can post on Facebook, you can post on X, you can post it all over the place. You can embed it in articles. You can do all kinds of stuff to distribute a photo. Couldn't do that 40 years ago. You bought the film, you took the pictures, you got the film developed, got an extra set for grandma and you mailed the film, the pictures off. That's what you did. Think of the cost. But where is that 2 trillion pictures captured? I mean, obviously some of it's captured in the value of Instagram, which is part of meta. But again, that's based upon the advertising. Still based upon revenues. The answer to this is crypto. The answer to this is these platforms. Even though the cost of knowledge goes down, it doesn't mean the value of the knowledge is destroyed. In fact, quite the contrary. We know data, which then can go into information, which then becomes knowledge if there's context. And that's one of the things that these AI systems have to work on. That only keeps growing. That grows in value, but it's not. So how do we reconcile this? Values going up, cost is going down. To me, that's cryptocurrency. Cryptocurrency values a network, captures the value of a network. That's what it does. And it doesn't need revenues. It doesn't need profits. Ethereum does not need profits to become a very valuable network. In fact, Ethereum doesn't really generate profits. I mean, it generates a return for the stakeholders and, you know, you have people provide infrastructure, maybe they get a return off their infrastructure, their servers and whatnot, depend on the network. They get fees, you know, trading fees or transaction fees, things of that nature. But crypto can operate in a world where there are no revenues. Just think of that. Hope everybody has a great day. We'll catch you next time.

It is great that you gave a lot of arguments and examples to back up what you are saying. I agree that things will start to cost lower once AI and robotics have really changed the manufacturing side of things. Although I don't know if big companies will just let go of their revenues. They will always find more ways to take advantage of things.

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