AlphaBlock

29 Pages Posted: 16 Nov 2017 Last revised: 16 Mar 2018

Date Written: November 14, 2017

Abstract

As intelligence moves from arbitrary and erratic patterns of human discretionary knowledge-building toward a more systematic and organic AI, there is a need for a new market mechanism to validate, distribute, and reward intelligent processes. Such an intelligent market is built on a systematic, scientific, replicable (SSR) process that is objective, accountable and can be validated and used by the community. This general intelligence or “alpha” should be content-agnostic and context-focused - an alpha process reconfiguring the block of the blockchain into ‘AlphaBlock’, an intelligent market mechanism. Alpha prediction has conventionally been associated with domain-specific content and is known to be predictive systems that are non-replicable and are mostly non-scientific. The author defines a General AI predictive process that can be fused into the blockchain block, transforming the blockchain into a multi-purpose predictive tool which self-builds, self-protects, and self-validates. AlphaBlock becomes the essence of everything linked with data predictability, evolving into an intelligence layer on the blockchain and the web. It is a predictive ecosystem which blurs the distinction between financial and non-financial data - ultimately removing barriers between financial and services markets. The blockchain can achieve this evolved state and become an intelligent market state if it crosses three key hurdles: First, it securitizes blockchain assets and creates new alternative assets and asset classes. Second, it resolves the incapability of conventional finance to understand risk effectively and enhances return per unit of risk (outperform the market) using a General AI process. Third, it must offer a better mechanism to address currency risk than what is offered by the existing fiat currencies and cryptocurrencies.

Keywords: Blockchain, Alternative Assets, Smart Contracts, Asset Pricing

JEL Classification: A00, A10

Suggested Citation

Pal, Mukul, AlphaBlock (November 14, 2017). Available at SSRN: https://ssrn.com/abstract=3070978 or http://dx.doi.org/10.2139/ssrn.3070978

Mukul Pal (Contact Author)

AlphaBlock ( email )

Toronto, Ontario M8Z 2H6
Canada

HOME PAGE: http://www.alphablock.org

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