Blockchain, cryptocurrency, and artificial intelligence in finance

YJ An, PMS Choi, SH Huang - Fintech with artificial intelligence, big data …, 2021 - Springer
YJ An, PMS Choi, SH Huang
Fintech with artificial intelligence, big data, and blockchain, 2021Springer
This chapter describes the principles of blockchain, cryptocurrency, and artificial intelligence
(AI) and their applications to the financial sector. We first discuss blockchain, and discuss
cryptocurrency, the best-known application of blockchain. We present the question of
whether a cryptocurrency is a currency or an asset and whether it can be a new safe haven
asset. We summarize the controversy regarding the issuance of a central bank digital
currency (CBDC). We argue that digital currencies only show the potential to inject liquidity …
Abstract
This chapter describes the principles of blockchain, cryptocurrency, and artificial intelligence (AI) and their applications to the financial sector. We first discuss blockchain, and discuss cryptocurrency, the best-known application of blockchain. We present the question of whether a cryptocurrency is a currency or an asset and whether it can be a new safe haven asset. We summarize the controversy regarding the issuance of a central bank digital currency (CBDC). We argue that digital currencies only show the potential to inject liquidity into an economy during market stress. Additionally, most of the recognized advantages of blockchain applications relate to two concepts: decentralization and consensus. Blockchain’s decentralization can be used to democratize banking services, corporate governance, and the real estate industry. Finally, we present the strengths of and concerns in using AI technologies in banking, lending platforms, and asset management, bearing in mind the most recently developed applications in these areas. This chapter provides a contribution to the literature that incorporates both theory and practice in blockchain, presenting a detailed review of performances and limitations of AI techniques in finance, including recent publications relating to the COVID-19 pandemic, CBDC, and alternative data.
Springer
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