This Is Why the Decentralization of AI Matters

A decentralized AI bears an amazing opportunity:  Do it better than traditional centralized AI such as Open AIs Chat GPT, Copilot Midjourney, or Runway, which squeeze out value derived from users’ data and IP they do not own. Better than extracting billions of dollars for its owners alone.

With Web3 technology and attitude, we can make sure that users and IP contributors are more than just clients and/or the product. Let’s take a look at this from the perspective of AI-generated 3D Avatars from PFP IP.

Why Do We Need an AI to be Decentralized?

This quote meme-ing around for decades is now, in the AI hype cycle of the 2020s, more relevant than ever: "If you're not paying for the product, you are the product." Holders of valuable IP should be very aware of this, as AI is one of the major value extractors of the digital age, not only since we know what Jaron Lanier has to say on this.

What has been happening with the intellectual property (IP) created for decades, by millions of people? It is fed into AI ‘black boxes’ that in return produce value for millions of people - while the earnings made from these services end up in the hands of a few shareholders.

And what about the creative work in social networks - AI-algorithm-based value extraction happens with only a few exceptions completely with the creatives uninvited to the party.

But this can be done very differently. Blockchain technology gives us all the tools we need to build an AI that fixes this imbalance, for tech that is currently disrupting almost any industry - no matter if it is image creation, coding, writing, etc. A decentralized AI in the shape of a DAO gives us an amazing opportunity to take care of everyone involved with the interplay of an AI entity: builders, users, contributors, and IP holders.

This is not just a question of compensation, but also of power. While the alignment problem is on the radar of AI experts and critics, the power of the few who own an AI must be taken just as seriously to prevent a significant imbalance, with potentially negative consequences.

This is How a Generative, Decentralized AI May Look Like

Blockchain provides us with all we need to build something better. To build an AI for the users, owned by the users. This is because the users of a project are just as important as the creators, especially when it comes to AI which is reliant on human interaction. An AI DAO is a beneficial symbiosis, where every stakeholder has a benefit and a vote.

Take the example of an AI service that is generating 3D avatars from PFP: Without PFP, no avatars. Without IP, no avatars. That is why users and IP creators should become part of the project, and one example to do this is to give them governance power, which is in web3 mostly done via token distribution. This is how the power of an AI can be effectively distributed.

The Era of the Open Metaverse

In a world, where the internet is embedded in our everyday, 3-dimensional life, the projection of our digital identity becomes dramatically more important. And so will 3D avatars and skins. With more than 250 open metaverse projects, thousands of games in the making, and Virtual and Augmented Reality (VR/AR/ MR) devices on the verge of mass adoption, with 34 million such devices estimated to be shipped in 2024, such a timeline seems highly likely.

And AI is the obvious solution to make 3davatars highly accessible. And as even niche AI services are facing similar problems such as the ones mentioned above, we need to think about decentralization.

Symbiosis of IP and Tech: Decentralized Generative AI

An AI service likely has many shareholders: Developers, investors, users, and IP providers. As centralized AI services are not delivering a fair distribution of the generated wealth, in web3, there is a way to do it better. As one example of doing it differently, take the example of Beamit.space which is forming a DAO with all people involved, suggesting a more fair and balanced distribution of power and value:

1. Users who are minting 3D Avatars from their IP

   As the users are minting from their IP, they effectively provide crucial data for the datasets our AI is trained and optimized on.

   
   

2. Other supporters of the project

This is a model if an incentivized engagement/social media campaign is already used by many decentralized projects.

3. Investors

At the pre-launch stage of almost any project, there is already capital demand, especially when it comes to AI with high render costs and skilled devs. Even in this case, though, the involvement of VCs can be avoided to achieve maximum decentralization, finding micro investors. With the example of the 3D avatars, this could be ideally the IP-holders themselves.

4. Team & other ecosystem contributors

Finally, developers and other team members, plus other entities contributing to the DAO ecosystem, have to be part of the DAO as well, to have a stake in the tool they build, and co-govern its evolution

Conclusion: AI Should Be Decentralized for a Fair Power Distribution

With such a model a governance system for a decentralized AI is most effective: Governed by the people who are involved with its creation, usage, optimization, and evolution. Let’s do it better than most Web2 corporations did before, and make sure AI is not in the power of a few.

Disclosure: The Author is the founder of STARBREEDER PTE. LTD, a Singapore-based startup that is currently building the decentralized AI Beamit AI.