Watch the full video: https://www.youtube.com/watch?v=AihoZHzb6Do
1. Introduction to the Topic
The discussion centers around how AI can accelerate the growth of Web3 and DeFi, focusing on reducing user risks and improving the user experience. The importance of proper architecture and AI integration is highlighted to increase adoption and user retention.
2. Speakers’ Background and Credentials
The speakers, Martin and Tarmo, bring extensive experience in blockchain, finance, and architecture. Both are co-founders of SmartCredit.io and ChainAware.ai, platforms that provide AI-driven solutions for Web3 and DeFi. Their academic and professional expertise in financial systems and blockchain technology establishes credibility and authority on the topic.
3. State of Web3 and DeFi Adoption
Web3 has around 500 million users, but only 50 million are using DeFi applications. This shows a significant gap in user adoption, with many users still preferring centralized finance (CeFi) platforms like Binance or Coinbase. The discussion points out that even though Web3 offers decentralized finance, users are hesitant due to perceived risks and complexities.
4. Challenges in DeFi and Web3
The primary challenge in DeFi and Web3 is the prevalence of hacks, scams, and rug pulls, which reduce user trust. Many users are wary of transitioning from centralized platforms to decentralized ones due to the high perceived risk. Hackers consistently extract around 2-3% of total value locked (TVL) per year in DeFi, which is a major barrier to new user adoption.
5. Role of AI in Reducing Fraud and Enhancing Security
AI can play a crucial role in fraud detection and security by providing real-time predictive analytics. ChainAware.ai’s AI models analyze blockchain data to detect potentially fraudulent activities, such as rug pulls or phishing attacks, before they occur. These real-time fraud detection systems can significantly reduce the risks that users face in DeFi.
6. Adopting AI in Web3 for Growth
Web3 needs to integrate predictive AI tools to prevent fraud in real time. Unlike centralized finance, where transactions can be reversed, DeFi transactions are irreversible. Therefore, it is essential to prevent fraud before it happens. ChainAware.ai’s AI algorithms can predict with 98% accuracy which addresses or contracts are involved in fraudulent activities, ensuring greater user safety.
7. Web2 vs. Web3: Marketing Approaches
In Web2, marketing is intention-based, meaning companies analyze user data to target individuals with personalized advertisements and user interfaces. This approach has led to high conversion rates in Web2 platforms. In contrast, Web3 still relies on outdated mass marketing techniques where the same message is broadcasted to all users, leading to low conversion rates.
8. How AI Can Revolutionize Web3 Marketing
AI can help Web3 marketers shift from mass marketing to intention-based marketing, similar to what is used in Web2. By analyzing user behavior and blockchain data, AI can predict user intentions, helping marketers target the right users with the right messages. Adaptive user interfaces can further improve engagement by personalizing the experience for each user.
9. Leveraging Blockchain Data for Predictive Marketing
Blockchain data is more valuable than Web2 data for predicting user behavior because it is based on actual financial transactions. While Web2 uses search and social media data, blockchain transactions provide a clearer picture of a user’s intentions. By analyzing these transactions, AI can predict user preferences and future actions with high accuracy, making marketing efforts more effective.
10. Innovation in Web3: Merging AI and Blockchain
While Web3 has introduced significant innovations like self-custody and decentralization, more innovation is needed to achieve exponential growth. AI can bring about the next wave of innovation by improving fraud prevention, enhancing user experience, and driving user acquisition. The combination of AI and blockchain data will enable Web3 platforms to offer superior services and attract more users.
11. Conclusion: AI as a Key Enabler for Web3 Growth
In conclusion, AI is essential for addressing the current challenges in Web3, such as fraud, user retention, and marketing inefficiencies. By integrating AI into Web3 platforms, developers can build more secure, user-friendly, and personalized experiences. This, in turn, will drive adoption and growth, allowing Web3 and DeFi to reach their full potential. The future of Web3 lies in leveraging AI to innovate and improve both security and user engagement.
