TL;DR
Lightning Labs has launched a new set of developer tools to support AI apps to pay for online services using Bitcoin’s Lightning network. It is a step towards autonomous AI’s. The tool uses a status code that was included in the http protocol decades ago, but never used: ‘payment required’. There are a lot of reasons why this AI-crypto marriage might gather steam in the coming months and years. And indeed, this might pump our bags. Let’s have a look at why.
Did you know that AI bots have already been paying humans to access certain applications? The role that we humans were reduced to was ticking the box ‘I am human’ in web forms that the AI needed to pass. How ironic.
Now, I don’t know if this story is true – it’s one I chose not to fact-check. But in any case, the story won’t be true much longer. Humans will be pushed to the edges in AI task flow and payment flow. For the latter, we have of course crypto. Who needs an Earthling with a JP Morgan account now that we have permissionless payment rails? Blockchain technology makes cumbersome ask-the-human workarounds unnecessary. Permissionless, digital-native money such as Bitcoin allows for transactions between machines, humans, and machines and humans. It’s the intuitive choice of money for AI agents to use.
But forget about the machines for a second. Also, we as humans would in many cases prefer paying ChatGPT-4 not a fixed monthly fee, but small sums for specific tasks. Not to mention that a credit card is not even accessible to billions of people, whereas nearly all of the popular LLM platforms require credit card information in order for users to access their premium models. So, it’s not just AI’s that face a hurdle to access certain services on the web.
Currently, accessing AI feels like a weird blend of being stuck in the past (1950s-style plastic credit cards) and the future. Like ordering a quantum computer with gold coins.
Reasons Why AI and Crypto Are a Good Match
Payment in crypto (we’ll get into which coin would be preferred by AI’s in a second) would make sense for a few reasons. We already mentioned the permissionless aspect of crypto: an AI doesn’t need a human’s permission or intermediation to do its payments.
Second, the commodity that AI deals with lives on the internet. Data are the new gold to be mined. LLM models are extremely data-hungry and scrape websites. In response to these scouring bots, Twitter has already capped the number of tweets that can be accessed per account per day. It doesn’t want to serve as a well of free ‘training fuel’ for LLM models.
Data have value and so it only makes sense that Large Language Models like ChatGPT will at some point be requested to pay for the data they consume. Arguably, in a digital-native currency that trades outside business hours!
Another reason why especially Bitcoin/Lightning is uniquely well-suited to working with AI: you can’t pay 5 cents with a Paypal account but you can do microtransactions with Lightning. We touched on this above: why charge monthly payments if you can pay in a fine-grained manner?
Also, Lyn Alden in one of her investor letters gives a…
Erik started as a freelance writer around the time Satoshi was brewing on the whitepaper.
As a crypto investor, he is class of 2020. More of a holder than a trader, but never shy to experiment with new protocols.
