When AIs Buy Tokens with Tokens
On the Rollup Base, Artificial Intelligences Now Interact. Operator Coinbase Has Developed a Special Wallet for AIs. But Is It Really More Than Just Hype?
Coinbase CEO Brian Armstrong recently announced with pride that on Base, a rollup developed by Coinbase for Ethereum, AIs are now paying AIs. He describes this as an „important step towards AIs performing useful work.“
The AIs on Base use tokens to buy tokens: They use blockchain tokens, which represent values like Bitcoin or stablecoins, to purchase tokens for LLMs (Large Language Models), essentially words that the LLMs process.
AIs Can’t Open a Bank Account, But They Can Use a Wallet
Nowadays, Armstrong explains, if you assign a task to an AI and then leave for hours or days, it often won’t complete the task. „Part of the reason is the limitation of the technology itself. But another reason is that AIs can’t perform transactions to acquire the resources they need.“
AIs don’t have a credit card. They can’t buy AWS computing cycles, order a website, book a flight, reserve a hotel room, etc. They can’t unlock paywalls to purchase scientific articles, place ads on Twitter or Facebook, and so on.
An AI can’t, as a long popular saying goes, open a bank account, but it can use a crypto wallet. With the “MPC Wallet,“ Coinbase has developed a wallet specifically for AIs.
The MPC Wallet enables “financial autonomy” for AIs: AI agents can autonomously make financial decisions and independently send transactions. The idea isn’t new – but does it now ignite hype?
As Autonomous as a Dog Taking a Walk
As often with the topic of AI, a bit of exaggeration is involved here.
For an AI certainly doesn’t have autonomous control over crypto wallets – that’s simply not possible. A crypto wallet stores private keys for addresses on a blockchain, usually on a hard drive, in a hardware wallet, or on a piece of paper, typically secured by a password or PIN, which is only in the mind of its owner.
None of these options are feasible for an AI. An AI possesses nothing and has no privacy. It doesn’t have hard drive storage, access to its own computing system or hardware wallet, and no mind separated from the external world.
When it’s said that AIs autonomously manage wallets, it merely means they’re allowed access to a wallet owned by a human. The human can revoke the key at any time. An AI manages a wallet as autonomously as a dog taking a walk. It can’t open a bank account – and can’t own a wallet.
Exaggerated, But Not Trivial
You can allow an AI to use a wallet via an API. But that’s nothing special. APIs already exist today through which programs can use wallets, such as the Bitcoin client or exchange wallets, but also bank accounts or PayPal.
When it’s said that an AI uses a wallet, it just means doing what has long been common: allowing an algorithm to handle money, except that in this case, the algorithm happens to be an AI. There’s nothing to stop someone from doing this without Coinbase’s wallet.
The news is thus exaggerated – but that doesn’t mean it’s trivial. Crypto wallets could be much better suited to being controlled by intelligent autonomous agents.
For example, crypto transactions are “push” rather than “pull” transactions. The account isn’t charged retroactively, as with PayPal, but immediately. You can easily and securely transfer a certain amount to a wallet that the AI can use without worrying that an „error“ by the AI will clean out the bank account.
Moreover, an AI can fully utilize the functionalities of a blockchain. It could generate multisig transactions on Bitcoin as it pleases, or smart contracts on Ethereum or Base as needed. All these functions are not possible with PayPal or bank accounts, and if they are, a central authority would have to enable them.
Effortlessly Managing Millions of Transactions
Such a more honest perspective is also found in the documentation. Besides the nonsense of „financial autonomy“ for AIs, it lists more realistic promises.
The MPC Wallet, for instance, allows “automating complex financial transactions that would be time-consuming for humans, and scaling them.“ You can command an AI with a prompt, as with ChatGPT, to form a hundred transactions, for instance.
Coinbase also advertises that the MPC Wallet seamlessly connects to the decentralized finance ecosystem. You could command the AI with a verbal command to exchange a specific sum into five different currency pairs and invest them in the DeFi system, to give just one example.
With the MPC Wallet, you can “ensure that AI operations remain controllable and secure,” while “effortlessly managing millions of transactions.”
Just as ChatGPT isn’t an autonomous person, AIs don’t have autonomous access to a wallet. Rather, it’s about replacing the algorithm that already controls wallet APIs with an AI, making it better, more intuitive, and smarter.
In other words, crypto wallets can indeed become somewhat intelligent. And that’s genuinely an exciting step, not just for cryptocurrencies but potentially easier, simpler, more powerful, and safer than banks and other centralized providers.