Lightning Labs releases tools letting AI transact and hold Bitcoin

AI Interaction with Bitcoin Network

Lightning Labs, a Bitcoin (BTC) Lightning Network development firm, has unveiled a new set of tools for Artificial Intelligence (AI) to enable the sending and receiving of BTC on the network’s layer-2 solution.

On July 6, the toolkit was announced to help AI applications such as OpenAI’s ChatGPT to interact with the Bitcoin network and manage the cryptocurrency. This move is meant to make payments quicker, cheaper, and simpler for AI developers, allowing them to distance themselves from traditional payment rails and to enable pay-per-use AI models on Lightning.

Large Language Models (LLMs) are software applications based on large data sets, allowing them to generate human-like responses to user prompts and to execute other tasks.

The Latest Wave of LLM Models and AI Applications

Lightning Labs has expressed its enthusiasm for the new wave of innovation that the latest LLM models have brought about. The tools are based on the “L402 protocol”, a Lightning-native authentication system, and “Langchain”, a library used to simplify AI operations.

However, the Lightning Labs team is aware of the current shortcomings of LLMs, which lack native web-based payment mechanisms. This results in developers needing to rely on outdated payment methods such as credit cards, with the additional costs passed on to the users.

In addition, the team has noted that a new and rapidly growing class of “organisms”, such as intelligent LLM or AI Agents, are unable to easily access fiat payment systems as they are not recognized as entities by any nation.

Kody Low, developer at the community payments platform Fedi, discussed the interoperability between AI and BTC for payments in the “Stack Sats” podcast on July 6. Data from LN analytics platform 1ML suggests that the current Lightning Network (LN) capacity is 5,432 BTC, which is roughly $163.5 million. However, according to Bitcoin Visuals, the number of LN channels has decreased over the past year from 80,000 in July 2022 to around 70,000 today.

Categorized in:

Tagged in: