Blockchain
SingularityNET (AGIX): Understanding the key differences between narrow AI and AGI
Artificial intelligence (AI) has been a transformative force in our world, impacting individuals and industries globally. However, not all AI is created equal. The field of artificial intelligence spans a broad spectrum, from narrow AI, which is specialized and task-specific, to artificial general intelligence (AGI), which represents a yet-to-be-created form of AI system with similar cognitive capabilities to human ones, all the way to artificial superintelligence, a transformative technology that could change the world as we know it.
Understanding the differences between Narrow AI and AGI is critical to grasping the past, current state and future potential of AI technology, according to SingularityNET (AGIX).
Narrow AI: Specialized and task-specific
Narrow AI, also known as weak AI, is designed to perform a specific task or a narrow range of tasks. It works within predefined parameters and does not have the ability to perform tasks outside the designated domain.
Examples of Narrow AI include voice assistants like Siri and Alexa, recommendation systems on platforms like Netflix and Amazon, and voice and image recognition technologies. OpenAI’s ChatGPT is also a form of Narrow AI, which excels at understanding and generating human-like text based on the input it receives, but lacks general intelligence, consciousness, or self-awareness.
Narrow AI excels at specific tasks thanks to its ability to process large amounts of data and identify patterns. However, it lacks the versatility and general problem-solving capabilities of human intelligence or an AGI. It cannot transfer knowledge from one domain to another or understand the broader context of its actions.
AGI — The search for human-like intelligence
Artificial general intelligence (AGI), also known as strong artificial intelligence, is a theoretical form of artificial intelligence that possesses the cognitive abilities of a human. Can display intelligence not tied to a highly specific set of tasks, generalize learned concepts to new situations, and interpret tasks in the context of the world at large.
AGI would be able to understand, learn and apply knowledge across a wide range of tasks, showing flexibility and adaptability similar to human intelligence. It would demonstrate independent learning, reasoning, problem-solving skills and understanding of context, transferring knowledge from one area to another.
While significant progress has been made in the development of narrow AI, achieving AGI poses immense technical and ethical challenges. Companies and researchers, including those of SingularityNETare still grappling with fundamental questions about how to replicate the full spectrum of human cognition in machines.
The fundamental differences between narrow AI and AGI
The primary distinction between Narrow AI and AGI lies in their scope, generality, and versatility.
Narrow AI is highly specialized and limited to specific tasks. For example, an AI trained in image recognition cannot perform natural language processing tasks without retraining. However, an AGI would display broad versatility, capable of performing any intellectual task that a human can perform. The AGI will be able to seamlessly transition from one task to another and apply knowledge from one area to another.
In terms of learning and adaptability, narrow AI relies on supervised learning and large datasets to perform tasks. Requires extensive training and often needs retraining for new tasks or changes in its environment. AGI, however, would be able to learn and adapt autonomously, learning from minimal data, rapidly understanding new concepts, and adapting to unfamiliar situations without the need for extensive retraining.
When it comes to understanding and reasoning, narrow AI operates based on predefined rules and models. It lacks true understanding and cannot reason beyond its programmed parameters. AGI, on the other hand, would possess human-like understanding and reasoning abilities, understanding complex concepts, making judgments, and reasoning logically in different contexts.
The ability to transfer knowledge is another key difference. Narrow AI is limited in its ability to transfer knowledge between tasks, often requiring separate training and optimization for each new task. AGI, however, would be capable of transfer learning, where knowledge gained from one task can be applied to others, making AGI infinitely more efficient and adaptable.
From narrow AI to AGI and beyond
The development of AGI carries ethical and social implications beyond our wildest imagination.
While narrow AI is already raising questions about privacy, security and employment, AGI introduces more complex questions. Ensuring that AGI systems are safe, controllable and aligned with human values is a major concern. The risk of unintended consequences and misuse of AGI is significant and requires new approaches to employment, education and social safety nets.
AGI systems will need to make ethical decisions in complex situations, requiring the development of frameworks for ethical AI behavior. The potential for AGI to surpass human intelligence increases existential risks, making it essential to ensure that the development of AGI is guided by sound ethical principles and global cooperation.
Decentralization of AI and the subsequent development of AGI can distribute control and decision making, ensuring that AGI is a win-win rather than controlled by vested interests. With the right approach, governance, robust controls, decentralization frameworks and continuous oversight, the development of AGI in line with human values can be achieved, acting safely and beneficially for all sentient beings.
Image source: Shutterstock
Blockchain
Bitcoin (BTC) Price Crashes as Donald Trump’s Win Odds Dip
Markets received nominally good news on Thursday morning, with the US ISM manufacturing PMI for July falling much more than economists expected, sending interest rates to multi-month lows across the board. Additionally, initial jobless claims in the US jumped to their highest level in about a year. Taken together, the data adds to the sentiment that the US is on the verge of a cycle of monetary easing by the Federal Reserve, which is typically seen as bullish for risk assets, including bitcoin.
Blockchain
Terra Blockchain Reboots After Reentry Attack Leads to $4M Exploit
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CoinDesk is a awarded press agency that deals with the cryptocurrency sector. Its journalists respect a rigorous set of editorial policiesIn November 2023, CoinDesk has been acquired from the Bullish group, owner of Bullisha regulated digital asset exchange. Bullish Group is majority owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant digital asset holdings, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial board to protect journalistic independence. CoinDesk employees, including journalists, are eligible to receive options in the Bullish group as part of their compensation.
Blockchain
$6.8M Stolen, ASTRO Collapses 60%
In the latest news in the blockchain industry, there has been a turn of events that has severely affected Terra and its users and investors, with the company losing $6.8 million. The attack, which exploited a reentry vulnerability in the network’s IBC hooks, raises questions about the security measures of the once celebrated blockchain protocol.
A web3 security company, Cyvers Alerts reported that the exploit occurred on July 31st and caused the company to lose 60 million ASTRO, 3.5 million USDC500,000 USDTand 2. 7 BitcoinThe flaw was discovered in April and allows cybercriminals to make payments non-stop by withdrawing money from the network.
Earth’s response
Subsequently, to the hack employed on the Terra blockchain, its official X platform declared the Suspension network operations for a few hours to apply the emergency measure. Finally in its sendTerra’s official account agreed, sharing that its operations are back online: the core transactions that make up the platform are now possible again.
However, the overall value of the various assets lost in the event was unclear.
Market Impact: ASTRO Crashes!
The hack had an immediate impact on the price of ASTRO, which dropped nearly 60% to $0.0206 following the network shutdown. This sharp decline highlights the vulnerability of token prices to security breaches and the resulting market volatility.
This incident is not the first time Terra has faced serious challenges. Earlier this year, the blockchain encountered significant problems that called into question its long-term viability. These repeated incidents underscore the need for stronger security measures to protect users’ assets and maintain trust in the network.
The recent Terra hack serves as a stark reminder of the ongoing security challenges in the blockchain space. As the platform works to regain stability, the broader crypto community will be watching closely.
Read also: Record Cryptocurrency Theft: Over $1 Billion Stolen in 2024
This is a major setback for Terra. How do you think this will impact the blockchain industry?
Blockchain
Luxembourg proposes updates to blockchain laws | Insights and resources
On July 24, 2024, the Ministry of Finance proposed Blockchain Bill IVwhich will provide greater flexibility and legal certainty for issuers using Distributed Ledger Technology (DLT). The bill will update three of Luxembourg’s financial laws, the Law of 6 April 2013 on dematerialised securitiesTHE Law of 5 April 1993 on the financial sector and the Law of 23 December 1998 establishing a financial sector supervisory commissionThis bill includes the additional option of a supervisory agent role and the inclusion of equity securities in dematerialized form.
DLT and Luxembourg
DLT is increasingly used in the financial and fund management sector in Luxembourg, offering numerous benefits and transforming various aspects of the industry.
Here are some examples:
- Digital Bonds: Luxembourg has seen multiple digital bond issuances via DLT. For example, the European Investment Bank has issued bonds that are registered, transferred and stored via DLT processes. These bonds are governed by Luxembourg law and registered on proprietary DLT platforms.
- Fund Administration: DLT can streamline fund administration processes, offering new opportunities and efficiencies for intermediaries, and can do the following:
- Automate capital calls and distributions using smart contracts,
- Simplify audits and ensure reporting accuracy through transparent and immutable transaction records.
- Warranty Management: Luxembourg-based DLT platforms allow clients to swap ownership of baskets of securities between different collateral pools at precise times.
- Tokenization: DLT is used to tokenize various assets, including real estate and luxury goods, by representing them in a tokenized and fractionalized format on the blockchain. This process can improve the liquidity and accessibility of traditionally illiquid assets.
- Tokenization of investment funds: DLT is being explored for the tokenization of investment funds, which can streamline the supply chain, reduce costs, and enable faster transactions. DLT can automate various elements of the supply chain, reducing the need for reconciliations between entities such as custodians, administrators, and investment managers.
- Issuance, settlement and payment platforms:Market participants are developing trusted networks using DLT technology to serve as a single source of shared truth among participants in financial instrument investment ecosystems.
- Legal framework: Luxembourg has adapted its legal framework to accommodate DLT, recognising the validity and enforceability of DLT-based financial instruments. This includes the following:
- Allow the use of DLT for the issuance of dematerialized securities,
- Recognize DLT for the circulation of securities,
- Enabling financial collateral arrangements on DLT financial instruments.
- Regulatory compliance: DLT can improve transparency in fund share ownership and regulatory compliance, providing fund managers with new opportunities for liquidity management and operational efficiency.
- Financial inclusion: By leveraging DLT, Luxembourg aims to promote greater financial inclusion and participation, potentially creating a more diverse and resilient financial system.
- Governance and ethics:The implementation of DLT can promote higher standards of governance and ethics, contributing to a more sustainable and responsible financial sector.
Luxembourg’s approach to DLT in finance and fund management is characterised by a principle of technology neutrality, recognising that innovative processes and technologies can contribute to improving financial services. This is exemplified by its commitment to creating a compatible legal and regulatory framework.
Short story
Luxembourg has already enacted three major blockchain-related laws, often referred to as Blockchain I, II and III.
Blockchain Law I (2019): This law, passed on March 1, 2019, was one of the first in the EU to recognize blockchain as equivalent to traditional transactions. It allowed the use of DLT for account registration, transfer, and materialization of securities.
Blockchain Law II (2021): Enacted on 22 January 2021, this law strengthened the Luxembourg legal framework on dematerialised securities. It recognised the possibility of using secure electronic registration mechanisms to issue such securities and expanded access for all credit institutions and investment firms.
Blockchain Act III (2023): Also known as Bill 8055, this is the most recent law in the blockchain field and was passed on March 14, 2023. This law has integrated the Luxembourg DLT framework in the following way:
- Update of the Act of 5 August 2005 on provisions relating to financial collateral to enable the use of electronic DLT as collateral on financial instruments registered in securities accounts,
- Implementation of EU Regulation 2022/858 on a pilot scheme for DLT-based market infrastructures (DLT Pilot Regulation),
- Redefining the notion of financial instruments in Law of 5 April 1993 on the financial sector and the Law of 30 May 2018 on financial instruments markets to align with the corresponding European regulations, including MiFID.
The Blockchain III Act strengthened the collateral rules for digital assets and aimed to increase legal certainty by allowing securities accounts on DLT to be pledged, while maintaining the efficient system of the 2005 Act on Financial Collateral Arrangements.
With the Blockchain IV bill, Luxembourg will build on the foundations laid by previous Blockchain laws and aims to consolidate Luxembourg’s position as a leading hub for financial innovation in Europe.
Blockchain Bill IV
The key provisions of the Blockchain IV bill include the following:
- Expanded scope: The bill expands the Luxembourg DLT legal framework to include equity securities in addition to debt securities. This expansion will allow the fund industry and transfer agents to use DLT to manage registers of shares and units, as well as to process fund shares.
- New role of the control agent: The bill introduces the role of a control agent as an alternative to the central account custodian for the issuance of dematerialised securities via DLT. This control agent can be an EU investment firm or a credit institution chosen by the issuer. This new role does not replace the current central account custodian, but, like all other roles, it must be notified to the Commission de Surveillance du Secteur Financier (CSSF), which is designated as the competent supervisory authority. The notification must be submitted two months after the control agent starts its activities.
- Responsibilities of the control agent: The control agent will manage the securities issuance account, verify the consistency between the securities issued and those registered on the DLT network, and supervise the chain of custody of the securities at the account holder and investor level.
- Simplified payment processesThe bill allows issuers to meet payment obligations under securities (such as interest, dividends or repayments) as soon as they have paid the relevant amounts to the paying agent, settlement agent or central account custodian.
- Simplified issuance and reconciliationThe bill simplifies the process of issuing, holding and reconciling dematerialized securities through DLT, eliminating the need for a central custodian to have a second level of custody and allowing securities to be credited directly to the accounts of investors or their delegates.
- Smart Contract Integration:The new processes can be executed using smart contracts with the assistance of the control agent, potentially increasing efficiency and reducing intermediation.
These changes are expected to bring several benefits to the Luxembourg financial sector, including:
- Fund Operations: Greater efficiency and reduced costs by leveraging DLT for the issuance and transfer of fund shares.
- Financial transactions: Greater transparency and security.
- Transparency of the regulatory environment: Increased attractiveness and competitiveness of the Luxembourg financial centre through greater legal clarity and flexibility for issuers and investors using DLT.
- Smart Contracts: Potential for automation of contractual terms, reduction of intermediaries and improvement of transaction traceability through smart contracts.
Blockchain Bill IV is part of Luxembourg’s ongoing strategy to develop a strong digital ecosystem as part of its economy and maintain its status as a leading hub for financial innovation. Luxembourg is positioning itself at the forefront of Europe’s growing digital financial landscape by constantly updating its regulatory framework.
Local regulations, such as Luxembourg law, complement European regulations by providing a more specific legal framework, adapted to local specificities. These local laws, together with European initiatives, aim to improve both the use and the security of projects involving new technologies. They help establish clear standards and promote consumer trust, while promoting innovation and ensuring better protection against potential risks associated with these emerging technologies. Check out our latest posts on these topics and, for more information on this law, blockchain technology and the tokenization mechanism, do not hesitate to contact us.
We are available to discuss any project related to digital finance, cryptocurrencies and disruptive technologies.
This informational piece, which may be considered advertising under the ethics rules of some jurisdictions, is provided with the understanding that it does not constitute the rendering of legal or other professional advice by Goodwin or its attorneys. Past results do not guarantee a similar outcome.
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