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- The European Union (EU) has been warned by the European Blockchain Observatory and Forum (EUBOF) to get ready for the impending era of decentralized AI networks. The EUBOF stated in a report to the EU that the blending of AI with blockchain is emerging as a trend in the tech industry that is being investigated quickly, particularly in the financial and healthcare sectors. Supply chains and property management were identified in the report as industries that stand to gain from blockchain-related applications in the near future.
- The European Commission introduced the EUBOF initiative in 2020 to promote blockchain-related research and development. The EUBOF submitted its report to the EU in an attempt to persuade the body to begin debating how to best utilize blockchain’s use cases in the areas of automative technology, metaverse, energy, decentralized social media, smart contracts, and decentralized finance (DeFi). This came about after the EU released its MiCA regulations to regulate the volatile crypto sector last year.
- According to the EUBOF, blockchain networks will continue to gain traction in the upcoming years due to its capacity to provide interoperability, sustainability, and energy-efficient tech solutions. Blockchain and AI integration will enhance smart contract performance, which could support the expanding decentralized ecosystem.
- “MiCA has played a key role in establishing a unified regulatory framework with an emphasis on consumer protection, transparency, and market integrity for crypto-assets, issuers, and service providers. According to the research, “CBDCs, the fusion of blockchain technology and artificial intelligence, and other emerging trends will spur greater innovation and open up new opportunities across a range of industries.”
- Regarding CBDCs, the paper projects that in the near future, several kinds of CBDCs will coexist with conventional currency. The virtual equivalent of fiat currencies like the dollar, pound, and rupee is known as a CBDC, or central bank digital currency. CBDCs are enabled by blockchains, which permanently record past expenditures, increasing transparency. CBDCs, which are issued by central banks, function similarly to online payment methods but with quicker international fund transfers, more concrete histories, and faster transaction speeds.
- According to the paper, “it [CBDC] addresses end-user experience, technological, and regulatory considerations, along with potential implications for financial stability and the banking industry.”
- The EUBOF determined that, due to positive externalities, both the regulatory and ecosystem maturity connected to blockchain are developing. Initially, smaller, more nimble countries led the way, with larger nations following suit by capitalizing on matured legislation.
- The EU has not yet provided a response to the report’s findings. The Artificial Intelligence (AI) Act was passed by the EU on March 13, 2024, following the adoption of the MiCA laws for the cryptocurrency industry in 2023. This is intended to protect EU people from the hazards that artificial intelligence (AI) poses while also providing a secure environment in which AI can flourish in Europe. In twenty-four months, the Act is expected to be fully operational.
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