Blockchains and artificial intelligence are complementary technologies, according to crypto asset manager Grayscale, even as markets have recently treated them as part of the same trade.
Zach Pandl, head of research at Grayscale, said that while disruptive technologies tend to produce clear winners and losers, the relationship between AI and blockchain is more symbiotic than competitive. The rapid adoption of AI is expected to reward some industries, such as chipmakers, while putting pressure on others, including professional services segments.
“While cryptocurrency valuations have been closely correlated with the decline in software stocks, we believe blockchains and AI are fundamentally complementary,” he said in Wednesday’s blog post.
The US stock markets have been focused on the downtrend lately. The S&P 500 software index has fallen about 20% so far this year, and cryptocurrency valuations have moved closely with the sell-off. But Pandl argues that the parallel reduction obscures a more constructive long-term dynamic between the two technologies.
Investor anxiety about the disruptive potential of artificial intelligence has led to a broad sell-off in technology and software stocks, erasing significant market value as traders reassess long-held valuations.
U.S. software and services stocks have plunged, wiping out about $1 trillion in market capitalization, as fears grow that rapidly advancing artificial intelligence tools could disrupt traditional business models and revenue streams.
The S&P 500 software index has plunged as investors abandon high-profile tech names amid increased volatility and skepticism about the speed and profitability of AI adoption.
Pandl maintains that blockchains are likely to become the financial rails for AI agents. Today’s chatbots largely operate outside the financial system. But if AI agents are equipped with digital wallets, expect them to transact over blockchains rather than traditional banking infrastructure.
Blockchains offer transparency, near-instant settlement, 24/7 availability and global reach with an internet connection, he said. While opening a bank account requires a human intermediary, any user, including a bot, can create a blockchain address. Pandl said that increasing trading volumes of low-value stablecoins would be an early sign that this thesis is developing.
At the same time, he argued that blockchain technology could help mitigate some of the risks of AI. As large language models proliferate, concerns about data provenance, deepfakes, and the concentration of control over resources and decision-making are likely to intensify. Public blockchains, Pandl said, can provide verifiable records and more decentralized infrastructure to counter those trends.
The report acknowledged that AI may also present new challenges for crypto networks. Advanced tools could make blockchain surveillance more effective, potentially eroding user privacy. AI agents can also discover new vulnerabilities in smart contracts; OpenAI recently launched EVMbench, an initiative aimed at using AI to identify and address such risks.
Read more: Cryptocurrencies aren’t losing to AI, it’s just “capitalism doing its job,” says Dragonfly
