Charles Hoskinson: Cryptocurrency Will Absorb AI, Just as It Did With Cryptography

Charles Hoskinson believes artificial intelligence (AI) will repeat a process he witnessed firsthand decades ago.

The Cardano founder argues that blockchain technology will eventually absorb AI, much like cryptocurrency once absorbed the field of cryptography.

Hoskinson cited mathematical issues during this week's Deeptech Insights podcast. He noted data center investments are growing tenfold annually while power grids cannot keep pace.

He also mentioned open AI labs like OpenAI and Anthropic will eventually need to turn a profit, as the cost of pre-training new AI models becomes increasingly prohibitive.

Hoskinson connected this to his own career. He recalled cryptography experts once rejected ties to cryptocurrency but were later recruited as cryptocurrency funding grew. He predicts AI will follow a similar path within 5-10 years.

His argument centers on governance. Hoskinson noted current AI companies set their own rules for acceptable behavior and expression, while blockchain systems can establish common standards among participants.

He also proposed that the same infrastructure could track content sources and automatically pay royalties when AI uses others' work.

Hoskinson suggested an alternative to building more data centers: aggregating everyday smartphones and GPUs into decentralized learning networks. He compared current AI construction to the fiber optic boom of the late 1990s, where 90% of newly laid cables went unused for nearly a decade.

He warned data centers may follow a similar pattern, with smaller models running locally on devices like Apple M5 Mac Studios and cryptocurrency serving as an adjustment mechanism instead.

Hoskinson expressed pessimism about U.S. crypto regulation timelines. He predicts the Clarify Act won't pass Congress before 2029, citing three missteps by the Trump administration including over-linking crypto to Trump-related tokens.