Hashed’s Simon Kim Says AI Has a ‘Black Box’ Problem

Hashed’s Simon Kim believes the future of artificial intelligence hinges on a radical shift: breaking open the black box of centralized models like OpenAI and building a decentralized, transparent ecosystem powered by blockchain.

For Kim, CEO of South Korea’s leading crypto VC fund, the urgency is clear. AI’s unchecked centralization threatens to create a “god” we don’t understand, while blockchain offers the tools to reward creators, protect intellectual property, and provide transparency into generative AI – which has been widely criticized for its bias and selective reasoning.

“AI is being centralized. OpenAI is not open, and it is controlled by very few people, so it’s quite dangerous. Making this type of [closed source] foundational model is similar to making a ‘god’, but we don’t know how it works,” he said in an interview with CoinDesk.

Kim argues that open-source AI models like Meta’s Llama are an example of how AI can be built with decentralization and transparency in mind.

But he says the lack of robust incentive mechanisms for data providers – i.e. everyone who uses the internet – is still a problem.

“AI models are just crawling the original content on the web and giving answers without compensating the creators,” Kim said.

Kim believes we can fix this by developing a “copyright layer” where rights holders can track how their content is used – and re-used – by AI while being paid along the way.

Hashed thinks it’s found a solution to this with Story, an IP management protocol that it led a Series-B round in last year.

The fund hasn’t invested in any decentralized AI projects yet, but feels it is building exposure to the space via its investment in Story.

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“We definitely need a blockchain-based IP system to incentivize the original creator, both the creator and the remixers,” Kim continued.

Kim is far from the only voice calling for open source AI development. A growing chorus of voices from Meta’s Mark Zuckererg to the Economist’s editorial board all agree that the black box of closed source AI – the deity whose decisions and workings remain a mystery – has to go for the industry to mature.

But its up to Kim to convince them that the solution lies in blockchain and crypto.