It is no secret that the use of AI in managing investments, especially within the crypto realm, has surged exponentially over the last couple of years.
This is because these automated AI trading agents – which are essentially smart algorithms – are capable of monitoring markets round the clock while simultaneously learning from real-time market data, executing trades and even adjusting portfolios on their own.
However, entrusting money to a robotic trading entity raises an important question: i.e. can one really trust these tools?
This is where the blockchain comes in. By running these AI trading agents in conjunction with decentralized ledgers, it is possible to make their operations transparent as well as remove any single points of failure. Simply put, the blockchain turns these “black box” trading algorithms into open/verifiable participants within the broader financial ecosystem.
AI Trading Agents x Blockchain — An overview
When an AI trading agent operates via smart contracts on the blockchain, every action it takes (be it a trade, transfer, or general decision) is recorded on an immutable public ledger, making its decisions transparent and auditable in real-time.
For the end user, it’s like having a detailed, unchangeable log of the bot’s every move. The agent can’t hide a risky trade or quietly reroute funds without everyone noticing.
Similarly, the security side of things is dramatically improved as well. Because the blockchain is tamper-resistant and decentralized, hacking or manipulating an AI agent’s activities becomes far more difficult than if it were running on a private server.
The agent’s code executes on the network exactly as written, and transactions must follow the consensus rules – there’s no secret backdoor. Immutability means once an action happens, it’s locked in history, preventing any party from retroactively changing records to cover mistakes or fraud.
Last but equally important is the decentralization aspect. Traditional trading systems or bot platforms are often centralized – i.e. if the central service fails or is compromised, users are out of luck.
In contrast, an AI agent’s “brain” isn’t sitting on one company’s server; it’s effectively supported by the same global network that upholds the cryptocurrency itself. This makes the entire system more resilient to outages and attacks. No central authority can unilaterally shut down the agent or impose restrictions on its operations.
Trustworthy trading in action
One company at the forefront of this fusion of AI and blockchain tech is Giza, a Web3 startup building what it calls a “Web3 Agents Stack”. In simple terms, Giza’s platform uses intelligent AI agents to streamline complex decentralized finance operations, all built atop future-ready blockchain rails.
To elaborate, Giza’s agents can move funds, trade, lend, and invest across different crypto protocols on behalf of its users – but they do so in a way that preserves user control and trust at every step. This is made possible thanks to the use of a self-custodial smart account architecture, meaning each user’s agent operates out of a smart contract wallet that the user, and only the user, ultimately controls.
Furthermore, Giza never holds its users’ private keys or funds, a setup that is powered by account abstraction technology, which lets smart contracts act like user accounts. The benefit is that even as the AI automates complex yield strategies, a user does not have to hand over their assets to a third party.
Giza also utilizes session keys and permission frameworks to enhance its security. In essence, a session key is like a valet key for one’s car, i.e. it lets someone drive the car but maybe not open the trunk or drive beyond a certain distance. In Giza’s case, users give the AI agent a session key that allows it to perform specific trading actions on their behalf (like reallocating a stablecoin from one lending pool to another), but nothing more.
This holistic approach has already yielded impressive real-world results with Giza’s flagship agent — called ARMA — having already accrued over $1 million in stablecoin assets on-chain, spread across various lending pools, and optimizing returns better than any static strategy could.
Perhaps more astonishingly, it did so while executing around 15,000 transactions on its own, with zero human intervention in just one month.
Every one of those transactions – deposits, withdrawals, swaps – was recorded on the blockchain for anyone to verify. The outcome has been over $6.6 million in total trade volume generated by the agent’s activity, significantly boosting the liquidity and usage of its associated DeFi platforms.
Therefore, from the outside looking in, the global financial arena seems to be witnessing the birth of autonomous capital markets, one where it’s not just about automating trades, but fundamentally redefining how markets operate. Interesting times ahead!
Also Read: How can AI help Traders to Improve Crypto Trading in 2025?
