Biconomy Uses AI for Autonomous Transactions

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Leading the charge in Web3 infrastructure, Biconomy has introduced AI agents to autonomously manage on-chain transactions for users. This innovative move uses the Delegated Authorization Network (DAN), which serves as an authorization layer enabling these automated transactions. Biconomy co-founder Aniket Jindal explains that DAN is a relatively recent development, allowing users to hand over trading activities to AI agents.

What Will DAN Do?

DAN centers around the delegation of authority, enabling AI agents to oversee trading accounts and execute transactions based on user-defined instructions. After setting permissions with a decentralized application (DApp), users can provide specific inputs on fund allocation and trading strategies to these AI agents.

These AI agents are capable of performing tasks autonomously or semi-autonomously. Their functions range from automating routine actions to making intricate decisions in dynamic environments, guided by predefined criteria or learned behavior.

This capability surpasses traditional AI-powered trading bots, which mainly automate asset buying and selling. AI agents offer advanced management in asset allocation and portfolio optimization.

Secure and Private Transactions

Biconomy’s DAN ensures secure and private transactions through a sharding mechanism for key management. When an authorization key is created, it is split into multiple parts and distributed across a decentralized node network, ensuring no single node has complete access. This enhances key security and prevents compromises.

Biconomy employs EigenLayer, based on Ethereum’s economic security, to maintain the integrity and performance of each node in the DAN network. Validators in EigenLayer must reclaim Ethereum assets, which can be slashed if they engage in malicious activities. This mechanism allows AI to securely engage in on-chain transactions without violating self-custody principles.

Concrete Inferences

• AI agents can autonomously manage trading accounts.
• DAN provides a secure authorization layer for transactions.
• AI agents offer sophisticated asset allocation and portfolio optimization.
• Security is enhanced through a sharding mechanism for key management.

Growth Expected

The financial sector is anticipated to see substantial growth in the use of AI agents. A report by Grand View Research projects the global market for autonomous AI and agents to reach around $70.53 billion by 2030, growing at an annual rate of 42.8% from 2023 to 2030. Financial institutions are increasingly adopting AI agents for automating trading, risk management, and fraud detection, among other uses.

Biconomy’s incorporation of AI agents into on-chain transactions marks a major leap in automating financial activities within the Web3 ecosystem. DAN not only elevates transaction management with a secure, autonomous, and user-friendly authorization layer but also illustrates the broader potential of AI in financial operations.

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