OK! First I totally realize that AI and Bitcoin are like a vegetable and a fruit.
I’m referring to the price action of each in the stock market. Maybe the headline should be ‘is NViDIA (the face of AI) the new bitcoin?’ Or, ‘is AI the new blockchain?’ Whatever, suffice it to say artificial intelligence is HOT. Maybe not as hot as bitcoin, but HOT.
Just like bitcoin, AI is now being called out as in “a bubble.” NOT! Artificial intelligence is truly a total game changer in all its various applications. (Side note; it seems “someone” always decides that when something goes up strongly, usually without them participating. They then yell “bubble.” At this point, they have given up on bitcoin)
And, to be sure, there are many types, definitions and applications for AI. It’s easy to lump everything into a catch all, two-letter description and declare the whole sector a bubble, but that’s not fair. That’s like lumping bitcoin into ALL crypto – that’s not a fair comparison either.
So, real quick and real simple, what is AI (broadly)? Artificial intelligence, or AI, refers to computer systems capable of performing complex tasks that historically only a human could do, such as reasoning, making decisions, or solving problems. It can (and is) be(ing) used for self-driving cars, pilotless fighter jets that can fly 25 feet above the ground at 700 mph. Likewise, it can scour through ‘tons’ of data/research content faster than humans, translate languages and (on the dark side) create fake news/disinformation/biases for nefarious purposes, and so effectively that it can convince you the tooth fairy is real (what, its not??).
Certainly a few of the stocks in the AI sector have gone up dramatically and may be “valuation stretched,” but bitcoin has increased dramatically as well. But to proclaim AI is in a bubble is…….well, naive. By the way, AI still needs some maturing and refining. I asked my chatbot about a bubble and I got bubble bath, bubble gum and even bubble skin care, but no stocks (or bitcoin). Go figure. Artificial intelligence is here to stay, grow and change all of our lives. Exciting and a bit scary.
So is AI (all of it) the new bitcoin? Investors should sure hope so.
Bill Taylor is the CEO of Digital Wealth News and a 40+ year veteran of the financial markets. You can also ready his weekly musings on BTC, ETH, Gold & SP500 at “The Taylor Market Report“.
