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#433748 Could Tech Make Government As We Know It ...

Governments are one of the last strongholds of an undigitized, linear sector of humanity, and they are falling behind fast. Apart from their struggle to keep up with private sector digitization, federal governments are in a crisis of trust.

At almost a 60-year low, only 18 percent of Americans reported that they could trust their government “always” or “most of the time” in a recent Pew survey. And the US is not alone. The Edelman Trust Barometer revealed last year that 41 percent of the world population distrust their nations’ governments.

In many cases, the private sector—particularly tech—is driving greater progress in regulation-targeted issues like climate change than state leaders. And as decentralized systems, digital disruption, and private sector leadership take the world by storm, traditional forms of government are beginning to fear irrelevance. However, the fight for exponential governance is not a lost battle.

Early visionaries like Estonia and the UAE are leading the way in digital governance, empowered by a host of converging technologies.

In this article, we will cover three key trends:

Digital governance divorced from land
AI-driven service delivery and regulation
Blockchain-enforced transparency

Let’s dive in.

Governments Going Digital
States and their governments have forever been tied to physical territories, and public services are often delivered through brick-and-mortar institutions. Yet public sector infrastructure and services will soon be hosted on servers, detached from land and physical form.

Enter e-Estonia. Perhaps the least expected on a list of innovative nations, this former Soviet Republic-turned digital society is ushering in an age of technological statecraft.

Hosting every digitizable government function on the cloud, Estonia could run its government almost entirely on a server. Starting in the 1990s, Estonia’s government has covered the nation with ultra-high-speed data connectivity, laying down tremendous amounts of fiber optic cable. By 2007, citizens could vote from their living rooms.

With digitized law, Estonia signs policies into effect using cryptographically secure digital signatures, and every stage of the legislative process is available to citizens online.

Citizens’ healthcare registry is run on the blockchain, allowing patients to own and access their own health data from anywhere in the world—X-rays, digital prescriptions, medical case notes—all the while tracking who has access.

Today, most banks have closed their offices, as 99 percent of banking transactions occur online (with 67 percent of citizens regularly using cryptographically secured e-IDs). And by 2020, e-tax will be entirely automated with Estonia’s new e-Tax and Customs Board portal, allowing companies and tax authority to exchange data automatically. And i-Voting, civil courts, land registries, banking, taxes, and countless e-facilities allow citizens to access almost any government service with an electronic ID and personal PIN online.

But perhaps Estonia’s most revolutionary breakthrough is its recently introduced e-residency. With over 30,000 e-residents, Estonia issues electronic IDs to global residents anywhere in the world. While e-residency doesn’t grant territorial rights, over 5,000 e-residents have already established companies within Estonia’s jurisdiction.

After registering companies online, entrepreneurs pay automated taxes—calculated in minutes and transmitted to the Estonian government with unprecedented ease.

The implications of e-residency and digital governance are huge. As with any software, open-source code for digital governance could be copied perfectly at almost zero cost, lowering the barrier to entry for any group or movement seeking statehood.

We may soon see the rise of competitive governing ecosystems, each testing new infrastructure and public e-services to compete with mainstream governments for taxpaying citizens.

And what better to accelerate digital governance than AI?

Legal Compliance Through AI
Just last year, the UAE became the first nation to appoint a State Minister for AI (actually a friend of mine, H.E. Omar Al Olama), aiming to digitize government services and halve annual costs. Among multiple sector initiatives, the UAE hopes to deploy robotic cops by 2030.

Meanwhile, the U.K. now has a Select Committee on Artificial Intelligence, and just last month, world leaders convened at the World Government Summit to discuss guidelines for AI’s global regulation.

As AI infuses government services, emerging applications have caught my eye:

Smart Borders and Checkpoints

With biometrics and facial recognition, traditional checkpoints will soon be a thing of the past. Cubic Transportation Systems—the company behind London’s ticketless public transit—is currently developing facial recognition for automated transport barriers. Digital security company Gemalto predicts that biometric systems will soon cross-reference individual faces with passport databases at security checkpoints, and China has already begun to test this at scale. While the Alibaba Ant Financial affiliate’s “Smile to Pay” feature allows users to authenticate digital payments with their faces, nationally overseen facial recognition technologies allow passengers to board planes, employees to enter office spaces, and students to access university halls. With biometric-geared surveillance at national borders, supply chains and international travelers could be tracked automatically, and granted or denied access according to biometrics and cross-referenced databases.

Policing and Security

Leveraging predictive analytics, China is also working to integrate security footage into a national surveillance and data-sharing system. By merging citizen data in its “Police Cloud”—including everything from criminal and medical records, transaction data, travel records and social media—it may soon be able to spot suspects and predict crime in advance. But China is not alone. During London’s Notting Hill Carnival this year, the Metropolitan Police used facial recognition cross-referenced with crime data to pre-identify and track likely offenders.

Smart Courts

AI may soon be reaching legal trials as well. UCL computer scientists have developed software capable of predicting courtroom outcomes based on data patterns with unprecedented accuracy. Assessing risk of flight, the National Bureau of Economic Research now uses an algorithm leveraging data from hundreds of thousands of NYC cases to recommend whether defendants should be granted bail. But while AI allows for streamlined governance, the public sector’s power to misuse our data is a valid concern and issues with bias as a result of historical data still remain. As tons of new information is generated about our every move, how do we keep governments accountable?

Enter the blockchain.

Transparent Governance and Accountability
Without doubt, alongside AI, government’s greatest disruptor is the newly-minted blockchain. Relying on a decentralized web of nodes, blockchain can securely verify transactions, signatures, and other information. This makes it essentially impossible for hackers, companies, officials, or even governments to falsify information on the blockchain.

As you’d expect, many government elites are therefore slow to adopt the technology, fearing enforced accountability. But blockchain’s benefits to government may be too great to ignore.

First, blockchain will be a boon for regulatory compliance.

As transactions on a blockchain are irreversible and transparent, uploaded sensor data can’t be corrupted. This means middlemen have no way of falsifying information to shirk regulation, and governments eliminate the need to enforce charges after the fact.

Apply this to carbon pricing, for instance, and emission sensors could fluidly log carbon credits onto a carbon credit blockchain, such as that developed by Ecosphere+. As carbon values are added to the price of everyday products or to corporations’ automated taxes, compliance and transparency would soon be digitally embedded.

Blockchain could also bolster government efforts in cybersecurity. As supercities and nation-states build IoT-connected traffic systems, surveillance networks, and sensor-tracked supply chain management, blockchain is critical in protecting connected devices from cyberattack.

But blockchain will inevitably hold governments accountable as well. By automating and tracking high-risk transactions, blockchain may soon eliminate fraud in cash transfers, public contracts and aid funds. Already, the UN World Food Program has piloted blockchain to manage cash-based transfers and aid flows to Syrian refugees in Jordan.

Blockchain-enabled “smart contracts” could automate exchange of real assets according to publicly visible, pre-programmed conditions, disrupting the $9.5 trillion market of public-sector contracts and public investment projects.

Eliminating leakages and increasing transparency, a distributed ledger has the potential to save trillions.

Future Implications
It is truly difficult to experiment with new forms of government. It’s not like there are new countries waiting to be discovered where we can begin fresh. And with entrenched bureaucracies and dominant industrial players, changing an existing nation’s form of government is extremely difficult and usually only happens during times of crisis or outright revolution.

Perhaps we will develop and explore new forms of government in the virtual world (to be explored during a future blog), or perhaps Sea Steading will allow us to physically build new island nations. And ultimately, as we move off the earth to Mars and space colonies, we will have yet another chance to start fresh.

But, without question, 90 percent or more of today’s political processes herald back to a day before technology, and it shows in terms of speed and efficiency.

Ultimately, there will be a shift to digital governments enabled with blockchain’s transparency, and we will redefine the relationship between citizens and the public sector.

One day I hope i-voting will allow anyone anywhere to participate in policy, and cloud-based governments will start to compete in e-services. As four billion new minds come online over the next several years, people may soon have the opportunity to choose their preferred government and citizenship digitally, independent of birthplace.

In 50 years, what will our governments look like? Will we have an interplanetary order, or a multitude of publicly-run ecosystems? Will cyber-ocracies rule our physical worlds with machine intelligence, or will blockchains allow for hive mind-like democracy?

The possibilities are endless, and only we can shape them.

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#433696 3 Big Ways Tech Is Disrupting Global ...

Disruptive business models are often powered by alternative financing. In Part 1 of this series, I discussed how mobile is redefining money and banking and shared some of the dramatic transformations in the global remittance infrastructure.

In this article, we’ll discuss:

Peer-to-peer lending
AI financial advisors and robo traders
Seamless Transactions

Let’s dive right back in…

Decentralized Lending = Democratized Access to Finances
Peer-to-peer (P2P) lending is an age-old practice, traditionally with high risk and extreme locality. Now, the P2P funding model is being digitized and delocalized, bringing lending online and across borders.

Zopa, the first official crowdlending platform, arrived in the United Kingdom in 2004. Since then, the consumer crowdlending platform has facilitated lending of over 3 billion euros ($3.5 billion USD) of loans.

Person-to-business crowdlending took off, again in the U.K., in 2005 with Funding Circle, now with over 5 billion euros (~5.8 billion USD) of capital loaned to small businesses around the world.

Crowdlending next took off in the US in 2006, with platforms like Prosper and Lending Club. The US crowdlending industry has boomed to $21 billion in loans, across 515,000 loans.

Let’s take a step back… to a time before banks, when lending took place between trusted neighbors in small villages across the globe. Lending started as peer-to-peer transactions.

As villages turned into towns, towns turned into cities, and cities turned into sprawling metropolises, neighborly trust and the ability to communicate across urban landscapes broke down. That’s where banks and other financial institutions came into play—to add trust back into the lending equation.

With crowdlending, we are evidently returning to this pre-centralized-banking model of loans, and moving away from cumbersome intermediaries (e.g. high fees, regulations, and extra complexity).

Fueled by the permeation of the internet, P2P lending took on a new form as ‘crowdlending’ in the early 2000s. Now, as blockchain and artificial intelligence arrive on the digital scene, P2P lending platforms are being overhauled with transparency, accountability, reliability, and immutability.

Artificial Intelligence Micro Lending & Credit Scores
We are beginning to augment our quantitative decision-making with neural networks processing borrowers’ financial data to determine their financial ‘fate’ (or, as some call it, your credit score). Companies like Smart Finance Group (backed by Kai Fu Lee and Sinovation Ventures) are using artificial intelligence to minimize default rates for tens of millions of microloans.

Smart Finance is fueled by users’ personal data, particularly smartphone data and usage behavior. Users are required to give Smart Finance access to their smartphone data, so that Smart Finance’s artificial intelligence engine can generate a credit score from the personal information.

The benefits of this AI-powered lending platform do not stop at increased loan payback rates; there’s a massive speed increase as well. Smart Finance loans are frequently approved in under eight seconds. As we’ve seen with other artificial intelligence disruptions, data is the new gold.

Digitizing access to P2P loans paves the way for billions of people currently without access to banking to leapfrog the centralized banking system, just as Africa bypassed landline phones and went straight to mobile. Leapfrogging centralized banking and the credit system is exactly what Smart Finance has done for hundreds of millions of people in China.

Blockchain-Backed Crowdlending
As artificial intelligence accesses even the most mundane mobile browsing data to assign credit scores, blockchain technologies, particularly immutable ledgers and smart contracts, are massive disruptors to the archaic banking system, building additional trust and transparency on top of current P2P lending models.

Immutable ledgers provide the necessary transparency for accurate credit and loan defaulting history. Smart contracts executed on these immutable ledgers bring the critical ability to digitally replace cumbersome, expensive third parties (like banks), allowing individual borrowers or businesses to directly connect with willing lenders.

Two of the leading blockchain platforms for P2P lending are ETHLend and SALT Lending.

ETHLend is an Ethereum-based decentralized application aiming to bring transparency and trust to P2P lending through Ethereum network smart contracts.

Secure Automated Lending Technology (SALT) allows cryptocurrency asset holders to use their digital assets as collateral for cash loans, without the need to liquidate their holdings, giving rise to a digital-asset-backed lending market.

While blockchain poses a threat to many of the large, centralized banking institutions, some are taking advantage of the new technology to optimize their internal lending, credit scoring, and collateral operations.

In March 2018, ING and Credit Suisse successfully exchanged 25 million euros using HQLA-X, a blockchain-based collateral lending platform.

HQLA-X runs on the R3 Corda blockchain, a platform designed specifically to help heritage financial and commerce institutions migrate away from their inefficient legacy financial infrastructure.

Blockchain and tokenization are going through their own fintech and regulation shakeup right now. In a future blog, I’ll discuss the various efforts to more readily assure smart contracts, and the disruptive business model of security tokens and the US Securities and Exchange Commission.

Parallels to the Global Abundance of Capital
The abundance of capital being created by the advent of P2P loans closely relates to the unprecedented global abundance of capital.

Initial coin offerings (ICOs) and crowdfunding are taking a strong stand in disrupting the $164 billion venture capital market. The total amount invested in ICOs has risen from $6.6 billion in 2017 to $7.15 billion USD in the first half of 2018. Crowdfunding helped projects raise more than $34 billion in 2017, with experts projecting that global crowdfunding investments will reach $300 billion by 2025.

In the last year alone, using ICOs, over a dozen projects have raised hundreds of millions of dollars in mere hours. Take Filecoin, for example, which raised $257 million  in only 30 days; its first $135 million was raised in the first hour. Similarly, the Dragon Coin project (which itself is revolutionizing remittance in high-stakes casinos around the world) raised $320 million in its 30-day public ICO.

Some Important Takeaways…

Technology-backed fundraising and financial services are disrupting the world’s largest financial institutions. Anyone, anywhere, at anytime will be able to access the capital they need to pursue their idea.

The speed at which we can go from “I’ve got an idea” to “I run a billion-dollar company” is moving faster than ever.

Following Ray Kurzweil’s Law of Accelerating Returns, the rapid decrease in time to access capital is intimately linked (and greatly dependent on) a financial infrastructure (technology, institutions, platforms, and policies) that can adapt and evolve just as rapidly.

This new abundance of capital requires financial decision-making with ever-higher market prediction precision. That’s exactly where artificial intelligence is already playing a massive role.

Artificial Intelligence, Robo Traders, and Financial Advisors
On May 6, 2010, the Dow Jones Industrial Average suddenly collapsed by 998.5 points (equal to 8 percent, or $1 trillion). The crash lasted over 35 minutes and is now known as the ‘Flash Crash’. While no one knows the specific reason for this 2010 stock market anomaly, experts widely agree that the Flash Crash had to do with algorithmic trading.

With the ability to have instant, trillion-dollar market impacts, algorithmic trading and artificial intelligence are undoubtedly ingrained in how financial markets operate.

In 2017, CNBC.com estimated that 90 percent of daily trading volume in stock trading is done by machine algorithms, and only 10 percent is carried out directly by humans.

Artificial intelligence and financial management algorithms are not only available to top Wall Street players.

Robo-advisor financial management apps, like Wealthfront and Betterment, are rapidly permeating the global market. Wealthfront currently has $9.5 billion in assets under management, and Betterment has $10 billion.

Artificial intelligent financial agents are already helping financial institutions protect your money and fight fraud. A prime application for machine learning is in detecting anomalies in your spending and transaction habits, and flagging potentially fraudulent transactions.

As artificial intelligence continues to exponentially increase in power and capabilities, increasingly powerful trading and financial management bots will come online, finding massive new and previously lost streams of wealth.

How else are artificial intelligence and automation transforming finance?

Disruptive Remittance and Seamless Transactions
When was the last time you paid in cash at a toll booth? How about for a taxi ride?

EZ-Pass, the electronic tolling company implemented extensively on the East Coast, has done wonders to reduce traffic congestion and increase traffic flow.

Driving down I-95 on the East Coast of the United States, drivers rarely notice their financial transaction with the state’s tolling agencies. The transactions are seamless.

The Uber app enables me to travel without my wallet. I can forget about payment on my trip, free up my mental bandwidth and time for higher-priority tasks. The entire process is digitized and, by extension, automated and integrated into Uber’s platform (Note: This incredible convenience many times causes me to accidentally walk out of taxi cabs without paying!).

In January 2018, we saw the success of the first cutting-edge, AI-powered Amazon Go store open in Seattle, Washington. The store marked a new era in remittance and transactions. Gone are the days of carrying credit cards and cash, and gone are the cash registers. And now, on the heals of these early ‘beta-tests’, Amazon is considering opening as many as 3,000 of these cashierless stores by 2023.

Amazon Go stores use AI algorithms that watch various video feeds (from advanced cameras) throughout the store to identify who picks up groceries, exactly what products they select, and how much to charge that person when they walk out of the store. It’s a grab and go experience.

Let’s extrapolate the notion of seamless, integrated payment systems from Amazon Go and Uber’s removal of post-ride payment to the rest of our day-to-day experience.

Imagine this near future:

As you near the front door of your home, your AI assistant summons a self-driving Uber that takes you to the Hyperloop station (after all, you work in L.A. but live in San Francisco).

At the station, you board your pod, without noticing that your ticket purchase was settled via a wireless payment checkpoint.

After work, you stop at the Amazon Go and pick up dinner. Your virtual AI assistant passes your Amazon account information to the store’s payment checkpoint, as the store’s cameras and sensors track you, your cart and charge you auto-magically.

At home, unbeknownst to you, your AI has already restocked your fridge and pantry with whatever items you failed to pick up at the Amazon Go.

Once we remove the actively transacting aspect of finance, what else becomes possible?

Top Conclusions
Extraordinary transformations are happening in the finance world. We’ve only scratched the surface of the fintech revolution. All of these transformative financial technologies require high-fidelity assurance, robust insurance, and a mechanism for storing value.

I’ll dive into each of these other facets of financial services in future articles.

For now, thanks to coming global communication networks being deployed on 5G, Alphabet’s LUNE, SpaceX’s Starlink and OneWeb, by 2024, nearly all 8 billion people on Earth will be online.

Once connected, these new minds, entrepreneurs, and customers need access to money and financial services to meaningfully participate in the world economy.

By connecting lenders and borrowers around the globe, decentralized lending drives down global interest rates, increases global financial market participation, and enables economic opportunity to the billions of people who are about to come online.

We’re living in the most abundant time in human history, and fintech is just getting started.

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#433282 The 4 Waves of AI: Who Will Own the ...

Recently, I picked up Kai-Fu Lee’s newest book, AI Superpowers.

Kai-Fu Lee is one of the most plugged-in AI investors on the planet, managing over $2 billion between six funds and over 300 portfolio companies in the US and China.

Drawing from his pioneering work in AI, executive leadership at Microsoft, Apple, and Google (where he served as founding president of Google China), and his founding of VC fund Sinovation Ventures, Lee shares invaluable insights about:

The four factors driving today’s AI ecosystems;
China’s extraordinary inroads in AI implementation;
Where autonomous systems are headed;
How we’ll need to adapt.

With a foothold in both Beijing and Silicon Valley, Lee looks at the power balance between Chinese and US tech behemoths—each turbocharging new applications of deep learning and sweeping up global markets in the process.

In this post, I’ll be discussing Lee’s “Four Waves of AI,” an excellent framework for discussing where AI is today and where it’s going. I’ll also be featuring some of the hottest Chinese tech companies leading the charge, worth watching right now.

I’m super excited that this Tuesday, I’ve scored the opportunity to sit down with Kai-Fu Lee to discuss his book in detail via a webinar.

With Sino-US competition heating up, who will own the future of technology?

Let’s dive in.

The First Wave: Internet AI
In this first stage of AI deployment, we’re dealing primarily with recommendation engines—algorithmic systems that learn from masses of user data to curate online content personalized to each one of us.

Think Amazon’s spot-on product recommendations, or that “Up Next” YouTube video you just have to watch before getting back to work, or Facebook ads that seem to know what you’ll buy before you do.

Powered by the data flowing through our networks, internet AI leverages the fact that users automatically label data as we browse. Clicking versus not clicking; lingering on a web page longer than we did on another; hovering over a Facebook video to see what happens at the end.

These cascades of labeled data build a detailed picture of our personalities, habits, demands, and desires: the perfect recipe for more tailored content to keep us on a given platform.

Currently, Lee estimates that Chinese and American companies stand head-to-head when it comes to deployment of internet AI. But given China’s data advantage, he predicts that Chinese tech giants will have a slight lead (60-40) over their US counterparts in the next five years.

While you’ve most definitely heard of Alibaba and Baidu, you’ve probably never stumbled upon Toutiao.

Starting out as a copycat of America’s wildly popular Buzzfeed, Toutiao reached a valuation of $20 billion by 2017, dwarfing Buzzfeed’s valuation by more than a factor of 10. But with almost 120 million daily active users, Toutiao doesn’t just stop at creating viral content.

Equipped with natural-language processing and computer vision, Toutiao’s AI engines survey a vast network of different sites and contributors, rewriting headlines to optimize for user engagement, and processing each user’s online behavior—clicks, comments, engagement time—to curate individualized news feeds for millions of consumers.

And as users grow more engaged with Toutiao’s content, the company’s algorithms get better and better at recommending content, optimizing headlines, and delivering a truly personalized feed.

It’s this kind of positive feedback loop that fuels today’s AI giants surfing the wave of internet AI.

The Second Wave: Business AI
While internet AI takes advantage of the fact that netizens are constantly labeling data via clicks and other engagement metrics, business AI jumps on the data that traditional companies have already labeled in the past.

Think banks issuing loans and recording repayment rates; hospitals archiving diagnoses, imaging data, and subsequent health outcomes; or courts noting conviction history, recidivism, and flight.

While we humans make predictions based on obvious root causes (strong features), AI algorithms can process thousands of weakly correlated variables (weak features) that may have much more to do with a given outcome than the usual suspects.

By scouting out hidden correlations that escape our linear cause-and-effect logic, business AI leverages labeled data to train algorithms that outperform even the most veteran of experts.

Apply these data-trained AI engines to banking, insurance, and legal sentencing, and you get minimized default rates, optimized premiums, and plummeting recidivism rates.

While Lee confidently places America in the lead (90-10) for business AI, China’s substantial lag in structured industry data could actually work in its favor going forward.

In industries where Chinese startups can leapfrog over legacy systems, China has a major advantage.

Take Chinese app Smart Finance, for instance.

While Americans embraced credit and debit cards in the 1970s, China was still in the throes of its Cultural Revolution, largely missing the bus on this technology.

Fast forward to 2017, and China’s mobile payment spending outnumbered that of Americans’ by a ratio of 50 to 1. Without the competition of deeply entrenched credit cards, mobile payments were an obvious upgrade to China’s cash-heavy economy, embraced by 70 percent of China’s 753 million smartphone users by the end of 2017.

But by leapfrogging over credit cards and into mobile payments, China largely left behind the notion of credit.

And here’s where Smart Finance comes in.

An AI-powered app for microfinance, Smart Finance depends almost exclusively on its algorithms to make millions of microloans. For each potential borrower, the app simply requests access to a portion of the user’s phone data.

On the basis of variables as subtle as your typing speed and battery percentage, Smart Finance can predict with astounding accuracy your likelihood of repaying a $300 loan.

Such deployments of business AI and internet AI are already revolutionizing our industries and individual lifestyles. But still on the horizon lie two even more monumental waves— perception AI and autonomous AI.

The Third Wave: Perception AI
In this wave, AI gets an upgrade with eyes, ears, and myriad other senses, merging the digital world with our physical environments.

As sensors and smart devices proliferate through our homes and cities, we are on the verge of entering a trillion-sensor economy.

Companies like China’s Xiaomi are putting out millions of IoT-connected devices, and teams of researchers have already begun prototyping smart dust—solar cell- and sensor-geared particulates that can store and communicate troves of data anywhere, anytime.

As Kai-Fu explains, perception AI “will bring the convenience and abundance of the online world into our offline reality.” Sensor-enabled hardware devices will turn everything from hospitals to cars to schools into online-merge-offline (OMO) environments.

Imagine walking into a grocery store, scanning your face to pull up your most common purchases, and then picking up a virtual assistant (VA) shopping cart. Having pre-loaded your data, the cart adjusts your usual grocery list with voice input, reminds you to get your spouse’s favorite wine for an upcoming anniversary, and guides you through a personalized store route.

While we haven’t yet leveraged the full potential of perception AI, China and the US are already making incredible strides. Given China’s hardware advantage, Lee predicts China currently has a 60-40 edge over its American tech counterparts.

Now the go-to city for startups building robots, drones, wearable technology, and IoT infrastructure, Shenzhen has turned into a powerhouse for intelligent hardware, as I discussed last week. Turbocharging output of sensors and electronic parts via thousands of factories, Shenzhen’s skilled engineers can prototype and iterate new products at unprecedented scale and speed.

With the added fuel of Chinese government support and a relaxed Chinese attitude toward data privacy, China’s lead may even reach 80-20 in the next five years.

Jumping on this wave are companies like Xiaomi, which aims to turn bathrooms, kitchens, and living rooms into smart OMO environments. Having invested in 220 companies and incubated 29 startups that produce its products, Xiaomi surpassed 85 million intelligent home devices by the end of 2017, making it the world’s largest network of these connected products.

One KFC restaurant in China has even teamed up with Alipay (Alibaba’s mobile payments platform) to pioneer a ‘pay-with-your-face’ feature. Forget cash, cards, and cell phones, and let OMO do the work.

The Fourth Wave: Autonomous AI
But the most monumental—and unpredictable—wave is the fourth and final: autonomous AI.

Integrating all previous waves, autonomous AI gives machines the ability to sense and respond to the world around them, enabling AI to move and act productively.

While today’s machines can outperform us on repetitive tasks in structured and even unstructured environments (think Boston Dynamics’ humanoid Atlas or oncoming autonomous vehicles), machines with the power to see, hear, touch and optimize data will be a whole new ballgame.

Think: swarms of drones that can selectively spray and harvest entire farms with computer vision and remarkable dexterity, heat-resistant drones that can put out forest fires 100X more efficiently, or Level 5 autonomous vehicles that navigate smart roads and traffic systems all on their own.

While autonomous AI will first involve robots that create direct economic value—automating tasks on a one-to-one replacement basis—these intelligent machines will ultimately revamp entire industries from the ground up.

Kai-Fu Lee currently puts America in a commanding lead of 90-10 in autonomous AI, especially when it comes to self-driving vehicles. But Chinese government efforts are quickly ramping up the competition.

Already in China’s Zhejiang province, highway regulators and government officials have plans to build China’s first intelligent superhighway, outfitted with sensors, road-embedded solar panels and wireless communication between cars, roads and drivers.

Aimed at increasing transit efficiency by up to 30 percent while minimizing fatalities, the project may one day allow autonomous electric vehicles to continuously charge as they drive.

A similar government-fueled project involves Beijing’s new neighbor Xiong’an. Projected to take in over $580 billion in infrastructure spending over the next 20 years, Xiong’an New Area could one day become the world’s first city built around autonomous vehicles.

Baidu is already working with Xiong’an’s local government to build out this AI city with an environmental focus. Possibilities include sensor-geared cement, computer vision-enabled traffic lights, intersections with facial recognition, and parking lots-turned parks.

Lastly, Lee predicts China will almost certainly lead the charge in autonomous drones. Already, Shenzhen is home to premier drone maker DJI—a company I’ll be visiting with 24 top executives later this month as part of my annual China Platinum Trip.

Named “the best company I have ever encountered” by Chris Anderson, DJI owns an estimated 50 percent of the North American drone market, supercharged by Shenzhen’s extraordinary maker movement.

While the long-term Sino-US competitive balance in fourth wave AI remains to be seen, one thing is certain: in a matter of decades, we will witness the rise of AI-embedded cityscapes and autonomous machines that can interact with the real world and help solve today’s most pressing grand challenges.

Join Me
Webinar with Dr. Kai-Fu Lee: Dr. Kai-Fu Lee — one of the world’s most respected experts on AI — and I will discuss his latest book AI Superpowers: China, Silicon Valley, and the New World Order. Artificial Intelligence is reshaping the world as we know it. With U.S.-Sino competition heating up, who will own the future of technology? Register here for the free webinar on September 4th, 2018 from 11:00am–12:30pm PST.

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Posted in Human Robots

#432882 Why the Discovery of Room-Temperature ...

Superconductors are among the most bizarre and exciting materials yet discovered. Counterintuitive quantum-mechanical effects mean that, below a critical temperature, they have zero electrical resistance. This property alone is more than enough to spark the imagination.

A current that could flow forever without losing any energy means transmission of power with virtually no losses in the cables. When renewable energy sources start to dominate the grid and high-voltage transmission across continents becomes important to overcome intermittency, lossless cables will result in substantial savings.

What’s more, a superconducting wire carrying a current that never, ever diminishes would act as a perfect store of electrical energy. Unlike batteries, which degrade over time, if the resistance is truly zero, you could return to the superconductor in a billion years and find that same old current flowing through it. Energy could be captured and stored indefinitely!

With no resistance, a huge current could be passed through the superconducting wire and, in turn, produce magnetic fields of incredible power.

You could use them to levitate trains and produce astonishing accelerations, thereby revolutionizing the transport system. You could use them in power plants—replacing conventional methods which spin turbines in magnetic fields to generate electricity—and in quantum computers as the two-level system required for a “qubit,” in which the zeros and ones are replaced by current flowing clockwise or counterclockwise in a superconductor.

Arthur C. Clarke famously said that any sufficiently advanced technology is indistinguishable from magic; superconductors can certainly seem like magical devices. So, why aren’t they busy remaking the world? There’s a problem—that critical temperature.

For all known materials, it’s hundreds of degrees below freezing. Superconductors also have a critical magnetic field; beyond a certain magnetic field strength, they cease to work. There’s a tradeoff: materials with an intrinsically high critical temperature can also often provide the largest magnetic fields when cooled well below that temperature.

This has meant that superconductor applications so far have been limited to situations where you can afford to cool the components of your system to close to absolute zero: in particle accelerators and experimental nuclear fusion reactors, for example.

But even as some aspects of superconductor technology become mature in limited applications, the search for higher temperature superconductors moves on. Many physicists still believe a room-temperature superconductor could exist. Such a discovery would unleash amazing new technologies.

The Quest for Room-Temperature Superconductors
After Heike Kamerlingh Onnes discovered superconductivity by accident while attempting to prove Lord Kelvin’s theory that resistance would increase with decreasing temperature, theorists scrambled to explain the new property in the hope that understanding it might allow for room-temperature superconductors to be synthesized.

They came up with the BCS theory, which explained some of the properties of superconductors. It also predicted that the dream of technologists, a room-temperature superconductor, could not exist; the maximum temperature for superconductivity according to BCS theory was just 30 K.

Then, in the 1980s, the field changed again with the discovery of unconventional, or high-temperature, superconductivity. “High temperature” is still very cold: the highest temperature for superconductivity achieved was -70°C for hydrogen sulphide at extremely high pressures. For normal pressures, -140°C is near the upper limit. Unfortunately, high-temperature superconductors—which require relatively cheap liquid nitrogen, rather than liquid helium, to cool—are mostly brittle ceramics, which are expensive to form into wires and have limited application.

Given the limitations of high-temperature superconductors, researchers continue to believe there’s a better option awaiting discovery—an incredible new material that checks boxes like superconductivity approaching room temperature, affordability, and practicality.

Tantalizing Clues
Without a detailed theoretical understanding of how this phenomenon occurs—although incremental progress happens all the time—scientists can occasionally feel like they’re taking educated guesses at materials that might be likely candidates. It’s a little like trying to guess a phone number, but with the periodic table of elements instead of digits.

Yet the prospect remains, in the words of one researcher, tantalizing. A Nobel Prize and potentially changing the world of energy and electricity is not bad for a day’s work.

Some research focuses on cuprates, complex crystals that contain layers of copper and oxygen atoms. Doping cuprates with various different elements, such exotic compounds as mercury barium calcium copper oxide, are amongst the best superconductors known today.

Research also continues into some anomalous but unexplained reports that graphite soaked in water can act as a room-temperature superconductor, but there’s no indication that this could be used for technological applications yet.

In early 2017, as part of the ongoing effort to explore the most extreme and exotic forms of matter we can create on Earth, researchers managed to compress hydrogen into a metal.

The pressure required to do this was more than that at the core of the Earth and thousands of times higher than that at the bottom of the ocean. Some researchers in the field, called condensed-matter physics, doubt that metallic hydrogen was produced at all.

It’s considered possible that metallic hydrogen could be a room-temperature superconductor. But getting the samples to stick around long enough for detailed testing has proved tricky, with the diamonds containing the metallic hydrogen suffering a “catastrophic failure” under the pressure.

Superconductivity—or behavior that strongly resembles it—was also observed in yttrium barium copper oxide (YBCO) at room temperature in 2014. The only catch was that this electron transport lasted for a tiny fraction of a second and required the material to be bombarded with pulsed lasers.

Not very practical, you might say, but tantalizing nonetheless.

Other new materials display enticing properties too. The 2016 Nobel Prize in Physics was awarded for the theoretical work that characterizes topological insulators—materials that exhibit similarly strange quantum behaviors. They can be considered perfect insulators for the bulk of the material but extraordinarily good conductors in a thin layer on the surface.

Microsoft is betting on topological insulators as the key component in their attempt at a quantum computer. They’ve also been considered potentially important components in miniaturized circuitry.

A number of remarkable electronic transport properties have also been observed in new, “2D” structures—like graphene, these are materials synthesized to be as thick as a single atom or molecule. And research continues into how we can utilize the superconductors we’ve already discovered; for example, some teams are trying to develop insulating material that prevents superconducting HVDC cable from overheating.

Room-temperature superconductivity remains as elusive and exciting as it has been for over a century. It is unclear whether a room-temperature superconductor can exist, but the discovery of high-temperature superconductors is a promising indicator that unconventional and highly useful quantum effects may be discovered in completely unexpected materials.

Perhaps in the future—through artificial intelligence simulations or the serendipitous discoveries of a 21st century Kamerlingh Onnes—this little piece of magic could move into the realm of reality.

Image Credit: ktsdesign / Shutterstock.com Continue reading

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#431653 9 Robot Animals Built From Nature’s ...

Millions of years of evolution have allowed animals to develop some elegant and highly efficient solutions to problems like locomotion, flight, and dexterity. As Boston Dynamics unveils its latest mechanical animals, here’s a rundown of nine recent robots that borrow from nature and why.
SpotMini – Boston Dynamics

Starting with BigDog in 2005, the US company has built a whole stable of four-legged robots in recent years. Their first product was designed to be a robotic packhorse for soldiers that borrowed the quadrupedal locomotion of animals to travel over terrain too rough for conventional vehicles.
The US Army ultimately rejected the robot for being too noisy, according to the Guardian, but since then the company has scaled down its design, first to the Spot, then a first edition of the SpotMini that came out last year.
The latter came with a robotic arm where its head should be and was touted as a domestic helper, but a sleeker second edition without the arm was released earlier this month. There’s little detail on what the new robot is designed for, but the more polished design suggests a more consumer-focused purpose.
OctopusGripper – Festo

Festo has released a long line of animal-inspired machines over the years, from a mechanical kangaroo to robotic butterflies. Its latest creation isn’t a full animal—instead it’s a gripper based on an octopus tentacle that can be attached to the end of a robotic arm.
The pneumatically-powered device is made of soft silicone and features two rows of suction cups on its inner edge. By applying compressed air the tentacle can wrap around a wide variety of differently shaped objects, just like its natural counterpart, and a vacuum can be applied to the larger suction cups to grip the object securely. Because it’s soft, it holds promise for robots required to operate safely in collaboration with humans.
CRAM – University of California, Berkeley

Cockroaches are renowned for their hardiness and ability to disappear down cracks that seem far too small for them. Researchers at UC Berkeley decided these capabilities could be useful for search and rescue missions and so set about experimenting on the insects to find out their secrets.
They found the bugs can squeeze into gaps a fifth of their normal standing height by splaying their legs out to the side without significantly slowing themselves down. So they built a palm-sized robot with a jointed plastic shell that could do the same to squeeze into crevices half its normal height.
Snake Robot – Carnegie Mellon University

Search and rescue missions are a common theme for animal-inspired robots, but the snake robot built by CMU researchers is one of the first to be tested in a real disaster.
A team of roboticists from the university helped Mexican Red Cross workers search collapsed buildings for survivors after the 7.1-magnitude earthquake that struck Mexico City in September. The snake design provides a small diameter and the ability to move in almost any direction, which makes the robot ideal for accessing tight spaces, though the team was unable to locate any survivors.
The snake currently features a camera on the front, but researchers told IEEE Spectrum that the experience helped them realize they should also add a microphone to listen for people trapped under the rubble.
Bio-Hybrid Stingray – Harvard University

Taking more than just inspiration from the animal kingdom, a group from Harvard built a robotic stingray out of silicone and rat heart muscle cells.
The robot uses the same synchronized undulations along the edge of its fins to propel itself as a ray does. But while a ray has two sets of muscles to pull the fins up and down, the new device has only one that pulls them down, with a springy gold skeleton that pulls them back up again. The cells are also genetically modified to be activated by flashes of light.
The project’s leader eventually hopes to engineer a human heart, and both his stingray and an earlier jellyfish bio-robot are primarily aimed at better understanding how that organ works.
Bat Bot – Caltech

Most recent advances in drone technology have come from quadcopters, but Caltech engineers think rigid devices with rapidly spinning propellers are probably not ideal for use in close quarters with humans.
That’s why they turned to soft-winged bats for inspiration. That’s no easy feat, though, considering bats use more than 40 joints with each flap of their wings, so the team had to optimize down to nine joints to avoid it becoming too bulky. The simplified bat can’t ascend yet, but its onboard computer and sensors let it autonomously carry out glides, turns, and dives.
Salto – UC Berkeley

While even the most advanced robots tend to plod around, tree-dwelling animals have the ability to spring from branch to branch to clear obstacles and climb quickly. This could prove invaluable for search and rescue robots by allowing them to quickly traverse disordered rubble.
UC Berkeley engineers turned to the Senegal bush baby for inspiration after determining it scored highest in “vertical jumping agility”—a combination of how high and how frequently an animal can jump. They recreated its ability to get into a super-low crouch that stores energy in its tendons to create a robot that could carry out parkour-style double jumps off walls to quickly gain height.
Pleurobot – École Polytechnique Fédérale de Lausanne

Normally robots are masters of air, land, or sea, but the robotic salamander built by researchers at EPFL can both walk and swim.
Its designers used X-ray videos to carefully study how the amphibians move before using this to build a true-to-life robotic version using 3D printed bones, motorized joints, and a synthetic nervous system made up of electronic circuitry.
The robot’s low center of mass and segmented legs make it great at navigating rough terrain without losing balance, and the ability to swim gives added versatility. They also hope it will help paleontologists gain a better understanding of the movements of the first tetrapods to transition from water to land, which salamanders are the best living analog of.
Eelume – Eelume

A snakelike body isn’t only useful on land—eels are living proof it’s an efficient way to travel underwater, too. Norwegian robotics company Eelume has borrowed these principles to build a robot capable of sub-sea inspection, maintenance, and repair.
The modular design allows operators to put together their own favored configuration of joints and payloads such as sensors and tools. And while an early version of the robot used the same method of locomotion as an eel, the latest version undergoing sea trials has added a variety of thrusters for greater speeds and more maneuverability.
Image Credit: Boston Dynamics / YouTube Continue reading

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