A16z’s recent $70 million throw at EigenLayer, in particular for EigenCloud. They’re betting everything on verifiable computation. This idea lets you verify off-chain happenings right on-chain. EigenDA, EigenVerify, EigenCompute – it all seems so cutting edge. I’m getting a strong smell of déjà vu. Is this going to be the game-changer for AI, healthcare, and media that everyone is hoping for? Or are we simply girding ourselves for yet another crypto doomsday prediction bust?
Trust on Chain, Really Though?
EigenCloud's promise is simple: verifiable computation. You can audit the calculations, data wrangling, everything, and have cryptographic proof of its integrity stored immutably on-chain. Eigen Labs’ cofounder and CEO Sreeram Kannan imagines a world where mass-market crypto apps go mainstream. Let’s not get ahead of ourselves. We've heard grand pronouncements before.
The fundamental problem isn’t even the tech itself (though even that is still to be fully proven at scale). It’s the application of that tech that gets concerning, especially as we move into more sensitive spaces such as AI and healthcare. Theranos kicked off a hype parade with its ability to perform numerous blood tests on an alleged pinprick of blood. The idea over time proved to be deeply fraudulent. Just as with Theranos, EigenCloud is making big claims to deliver a huge breakthrough, this time – on the blockchain. The blockchain does not magically provide solutions to everything. It doesn’t actively manage them — it just bears witness, usually with a large carbon footprint.
Data Privacy: The Elephant In The Room
Let's talk GDPR and HIPAA. Can EigenCloud truly guarantee compliance when handling sensitive patient information, though? The blockchain is immutable. Now mistakes, biases, and even malicious inputs become permanent records. How do you square that with giving people the right to be forgotten? A basic smart contract won’t be able to outsmart a court mandate or a government request. So what’s going to happen when an AI algorithm, “verified” by EigenCloud, returns a biased diagnosis? Who's liable? The developer? Eigen Labs? The hospital? The patient?
This isn't just a hypothetical concern. AI already comes with huge biases built in. With these biases engraved on the blockchain, we have not gotten rid of them, rather we have highlighted and cemented them. We're talking about potentially verifying discriminatory outcomes. The road to hell, it’s been said, is paved with good (and verifiable) intentions.
Unsurprisingly, facial recognition technology is wildly inaccurate, especially among communities of color. On top of that, algorithms often misidentify people of color 10 to 20 percent of the time. Yet if a biased algorithm were to be deployed in a healthcare setting, the consequences would be calamitous. Imagine if EigenCloud actually certified those erroneous results. The repercussions could be far worse.
Scalability, Cost, and the Healthcare Hesitation
Will EigenCloud truly scale to address the complexities of the modern AI and healthcare deluge? Verifiable computation doesn't come cheap. It’s a huge burden on computational resources, and those resources come with real-world costs. Most importantly, is it actually more cost-effective than the status quo auditing and verification methods? My guess is that for a lot of use cases, the answer is going to be an emphatic “no”.
Next, will the largest companies in other similarly regulated industries such as healthcare even be willing to embrace EigenCloud? They're already drowning in compliance requirements. It’s worth considering whether adding another layer of complexity—even one that offers the potential for greater transparency—is worth the effort. Now, picture having to explain to any of those regulators why you would be using a blockchain-based system to verify medical diagnoses. The deafening silence would be enough to make most compliance officers flee for the emergency exit.
EigenCloud's alpha release this week with major upgrades to EigenDA and a preview of EigenVerify, is a significant step, but it's only the first of many. For now, we’d like to hear more about how EigenCloud intends to fill these critical gaps.
Let's be clear: I'm not saying EigenCloud is doomed to fail. The underlying technology has potential. A16z’s $70 million bet doesn’t have the appearance of being a carefully calculated investment – it looks more like a leap of faith. It’s time to moderate the excitement with a bit of reality. We need to insist on specific, clear responses to the tough questions. Otherwise, EigenCloud may end up as yet another crypto fairy tale—a splendid idea that collapses with the first gust of real world. We also need to protect innovation from the excesses of innovation. More critically, we need to protect people from the unintended consequences of unbridled technological ambition.
