What is holding back the expansion of AI is no longer related to intelligence, according to a16z

Source: Yellow Original Title: What’s Holding Back AI Expansion Is No Longer About Intelligence, According to a16z

Original Link: Artificial intelligence is entering a phase where the main limitation is no longer the capacity of the models, but the lack of economic infrastructure and governance, according to a16z crypto.

In a series of forward-looking analyses, members of the firm’s research and investment teams argued that AI systems are already capable of performing substantive work, from academic research to financial tasks, but lack the identity, attribution, and compensation mechanisms necessary to operate at scale.

As a result, a16z positions blockchain-based systems as infrastructure rather than speculative technology.

AI Moves from Assistance to Discovery

Scott Kominers, a member of the a16z crypto research team and a professor at Harvard Business School, stated that AI models have advanced rapidly over the past year.

He described a shift from systems that struggled with abstract instructions to models capable of reasoning about complex problems in a manner comparable to advanced graduate students.

Kominers said that AI is increasingly used for discovery in fields with high reasoning loads, including mathematics, where models have demonstrated the ability to solve problems at the level of elite universities.

This has enabled a new style of research focused on conjecture, synthesis, and exploration, even when intermediate results are imperfect.

However, he noted that these workflows often depend on layered systems in which multiple models evaluate and refine each other’s outputs, raising unresolved questions about interoperability and how contributions should be recognized and rewarded.

From KYC to “Know Your Agent”

Another challenge highlighted by a16z is identity.

Sean Neville, co-founder of Circle and CEO of Catena Labs, stated that the agent economy today is less limited by intelligence and more by trust.

Neville said that non-human identities already outnumber human employees in financial systems, but most remain, in practice, “unbanked.”

He argued that, just as financial institutions rely on Know Your Customer (KYC) standards for humans, AI agents will need cryptographically verifiable credentials, a framework he called “Know Your Agent.”

Without these systems, Neville indicated, merchants and platforms will continue to block autonomous agents from conducting transactions at scale.

The Pressure of AI on the Open Web

Liz Harkavy, an investor on the a16z crypto team, warned that AI agents are imposing an “invisible tax” on the open web by extracting value from content while bypassing revenue models based on advertising and subscriptions.

She pointed out that existing licensing agreements have proven insufficient and argued that the web needs real-time usage-based compensation systems.

Blockchain-enabled micropayments and attribution standards, she said, could allow value to flow automatically to contributors.