AI oracles on blockchain
Epistemic status: Speculation on one path of AI development, but it has been on my mind for a while
Note: I haven’t found this idea developed anywhere, but possible it has already been discussed
Blockchain’s locked-in syndrome
Blockchains today suffer from a locked-in syndrome. There is a vibrant activity and innovation within the ecosystem, however most of it is self referential. DeFi protocols allow users to trade, lease and stake DeFi tokens that themselves support the governance of those protocols. Painstaking efforts are extended to link, in a decentralized way, some of the tokens to the external world. Example of complex protocol designed to achieve a decentralized link to external information is the USD-linked Dai stablecoin.
Blockchain is locked-in because of the well known Oracle Problem- when external data is entered into the blockchain there is no easy way to ascertain the trustworthiness of the information. External data input invalidates the whole concept of a trustless system, as it requires trust in the provider of the data, known as the blockchain oracle.
Several projects attempt to design incentive structures that generate trustworthy human-based oracles. So far, none of them are widely used and successful. However, for blockchain to fulfill its promise it will need to interact with the external world. Immediate use cases of external information on blockchain include tokenization of financial assets, development of insurance smart contracts, and adjudication of prediction markets.
AI as a solution to the oracle problem
AI oracles seem to be a potential solution for the oracle problem. A decentralized narrow AI program’s could be ported onto the blockchain and employed to provide immutable decisions for smart contracts based on interpretation of external information streams. A GPT-3 style program could scan the internet and decide the outcome of a prediction market contract on, say, election outcome. Decentralized image recognition could be used to verify insurance claims.
By being based on blockchain, the AI oracle will be decentralized, its code and decisions transparent and its decisions immutable. When combined with higher scalability, the AI oracles will be superior to incentive-based, human-verified oracles. Currently, AI is not widely used for oracles on blockchain due to low computational bandwidth of blockchain. This will change as blockchain technology improves.
Competitive pressure towards AGI with agency
Initial performance of AI as oracle may be error prone and limited to narrow use cases. However, there will be a strong competitive pressure to improve the quality of AI accuracy. Parties to a smart contract adjudicated by an AI oracle will have incentive to choose the most accurate available oracle.
Competitive pressure will arise between blockchains. Developers of different prediction market platforms will compete to provide more accurate AI oracles. Alternatively, the dominant prediction market platform will have different AI oracles competing for business. Incentive structures will be set up to reward developers of the most accurate AI oracles.
As the popularity of AI oracle-enabled blockchain solutions increases, there will be further incentive to invent more advanced solutions, leveraging more general AI. For example, decentralized identity verification systems would need AI oracles that combine visual, text and internet data. This pressure for improved AI oracles may precipitate a gradual move from pure question-answering AI oracles to AI with some agency, for example to contact human experts to verify complex information.
A scenario where increasingly strong AI is developed on blockchain potentially creates a new version of the AI safety problem. Blockchain being distributed, immutable, and potentially anonymous, allows for AGI agents that cannot be stopped, neither by a decision of a team of developers or by law enforcement. Moreover, anonymous teams will have strong financial incentives to develop and run increasingly more competent AI oracles. This would create a danger of AGI escape scenario not via a lab leak, but by deliberate upload into blockchain.
Potential for governance
In shorter term, combination of immutable smart contracts with the access to accurate external world information creates different dangers. Malevolent agents can use block chain to implement dangerous incentive schemes. For example, blockchain with access to accurate external information would allow for creating a murder bounty smart contract. Cryptocurrency would be staked in a crypto escrow that is transferred to whoever fulfills the contract, when the AI oracle verifies the killing and the killers’ identity (while preserving anonymity).
This development can act as a fire alarm. The blockchain governance systems will likely need to address such problems way before AGI agent is ported onto blockchain and so may create solutions of control and containment of AI oracles.
The direction of development of blockchain governance depends however on the macro dynamics of inter-blockchain competition. It is possible that the macro pressure will favor more immutable, more anonymous, more computationally scalable blockchains, with less stringent governance.
How plausible is this scenario?