(Read time: 7 minutes)

In lesson #1, we explored the basics of AI, the difference between AI and machine learning, and the game-changing “ChatGPT moment.” Now that Pandora’s box has been opened, there’s no turning back.

Now we turn to a big question:

Why do AI and Crypto need each other?

Every revolution needs two forces: one to create chaos, another to restore order.

AI brought the chaos.

Crypto restores the order.

Let’s put it another way: Should “knowledge” be controlled by a select few or shared among many?

A Lesson from History

Over 2,000 years ago, the Library of Alexandria was the world’s greatest knowledge repository. 

But its centralization was its downfall. When it was destroyed—likely by fire—humanity lost invaluable discoveries, setting progress back centuries.

Fast forward to the 14th century. Knowledge was locked away in monasteries, painstakingly copied by hand. A single Bible could take years to produce and cost as much as a house.

Then, in 1455, everything changed.

The printing press shattered that monopoly. Books became affordable. Knowledge flowed freely. Within decades, millions of books spread across Europe, fueling new ideas and a scientific revolution.

And history is rhyming again. This time in AI.

Today’s AI boom is like discovering a whole new continent—except this one has 100 billion super-intelligent beings ready to work for free. The potential is staggering. AI is reshaping society, possibly more profoundly than electricity, the internet, or even fire.

But here’s the catch: AI is becoming centralized and controlled by a handful of powerful entities. And when knowledge gets locked up, history tells us the consequences can be devastating.

AI is Mostly Centralized!

Right now, the development of AI is dominated by tech giants like Google, Microsoft, and Meta.

Why? Because building and training AI requires insane amounts of computing power, data, and specialized hardware—resources only the biggest companies can afford.

But this concentration of power creates some serious risks:

1. Lack of Transparency: The way these AI systems work is often hidden. We rely on them for important decisions, yet we don’t fully understand how they make those choices.

2. Manipulation and Bias: AI systems can be influenced or show biases, sometimes unintentionally steering public opinion or reinforcing stereotypes.

3. Censorship: When only a few companies control AI, they can restrict or censor information, potentially limiting free expression.

I don’t want a future where a few companies control the most powerful AI systems, dictating how everyone else lives. It’s unsettling—don’t you agree?

A Decentralised Future

So, how do we break AI free from the grip of Big Tech?

Crypto and blockchains!

Just as the printing press shattered the church’s monopoly on knowledge, blockchain can dismantle AI’s centralized control. Instead of intelligence being locked away, it can be spread across open, transparent networks.

Crypto provides the infrastructure for shared AI ownership, giving everyone a stake in its future. With decentralized models, AI won’t be controlled by a single corporation but by a community—aligned by incentives, not profits.

By blending crypto and AI, we can build systems that are:

• Transparent (open-source models, public verification)

• Fair (no single gatekeeper controlling the narrative)

• Resilient (censorship-resistant, immune to corporate influence)

The Perfect Match: AI and Crypto

AI is like the world’s supercomputer, using humanity’s shared knowledge and creativity to solve problems and create new ideas.

Crypto, on the other hand, builds open networks that anyone can join—a foundation for a new, more connected internet.

Together, these “super-computers” and “super-networks” make a powerful team:

AI makes crypto easier to use: Natural language interfaces remove complexity—no more clunky wallets.

Crypto keeps AI open and safe: Blockchain provides the rails to make AI transparent, verifiable, and globally accessible.

Fake vs Real

We’re heading into an age where anything can be faked: videos, voices, even entire personalities.

Crypto can be our anchor. With digital signatures, timestamps, and provenance trails, we can verify what’s real—and who made it.

No need to “trust the platform.”

Trust the math.

The Power of Tokens

Crypto’s superpower is tokens.

Tokens allow decentralized networks to grow and become self-sustaining, distributing ownership and value among all contributors.

The real game-changer? New business models.

• Decentralized GPU Marketplaces: Tapping into idle GPUs worldwide can slash AI’s massive compute costs.

• Crowdfunded AI Models: Tokens can finance community-owned AI models, breaking Big Tech’s grip on model training.

• AI Startups Get a Fair Shot: Instead of begging VCs for capital, small AI teams can issue tokens to access computing power and scale up.

Take Bittensor, for example—a project testing this idea with decentralized AI networks. In a later lesson, we’ll explore Bittensor and all of these concepts in more detail.

But Isn’t Crypto AI Already Overhyped?

You’ve probably seen headlines: “AI Tokens Surge Past $1B+ Valuations!”

Sure. Hype cycles come and go. But I believe we’re nowhere near the true peak.

What we’re seeing is infrastructure being laid, not a bubble popping. If this is the internet era, we’re in 1996—not 2001.

The upside is still ahead. And by reading this, you’re early.

Further Reading

If you want to go deeper, check out my Crypto AI thesis here:

What’s Next?

In our next few lessons, we’ll explore how AI models are trained and how chatGPT works (it’s magic… in a way).

Talk soon,

Teng Yan