The Brave New World of Cortex – Initiating Smart Contracts in the Era of AI

The Birb Nest Gem Series strives to identify undervalued blockchain projects that have truly disruptive potential in their fields of influence. From logistics solutions to internet freedom and novel social media platforms, there are any number of exciting use cases for cryptography beyond digital currency, but arguably none provide a more salient and adaptive use of the technology than smart contracts. In simple terms, smart contracts translate traditional contract terminology into actionable computer program code. Smart contracts on the blockchain are automatically triggered once certain preset criteria is met, transacting a set amount and denomination of digital currency upon satisfaction of the agreement, or similarly, enforcing penalties if agreements are broken or unsatisfied. The potential for such a line of products to disrupt long mistrusted segments of the global economy such as financial and legal intermediaries is only limited by the imagination in the form of intellectual resources. The promise of smart contracts, however, has not even begun to be met. A project called CORTEX is building a platform to equip smart contracts with an upgrade undreamed of in the current marketplace. As will be put forth in this report, Cortex is seeking to revolutionize the smart contract ecosystem by multiple degrees of magnitude, and in the process, may perform the dramatic civic duty of re-democratizing the power of artificial intelligence for the masses.

What’s Next?

The Emergence of a Smarter Contract

Though smart contracts were initially put forth in 1994 by the cryptographer and legal scholar, Nick Szabo, it wasn’t until the perfect marriage of the technology with blockchain’s immutable ledger that smart contracts began to truly take flight. In 2014 Vitalik Buterin launched the Ethereum network, and the ERC20 tokens quickly became ubiquitous with ‘smart contracts on the blockchain’. Though Ethereum enjoys the vast majority of current smart contract traffic on blockchain enabled networks, the product is still rather unrefined. The smart contract community is awaiting the ‘killer app’ that will usher the promise of blockchain into the mainstream. While it could be that some wily developer or team will indeed construct such an app under the limited capacity of ERC20, NEP5, or some other smart contract platform, it is far more likely that we haven’t seen the killer app because these so called ‘smart’ contracts are simply not smart enough.

The term smart contracts is a misnomer as they are not inherently smart, or rather, they do not exercise any thought process / data interpretation on their own, and are incapable of supporting real world AI. They are limited to recognizing predetermined language factors as true or false, same as a paper contract, only represented in code. While the utility of even this limited form of technology has already proved immensely valuable, Cortex provides a dramatic upgrade to smart contracts by empowering the previously lifeless code with true inference capacity and environment-sensitive intelligence. By bringing AI to smart contracts, Cortex makes apps possible that could never has been conceived of on the Ethereum network. To better understand what AI enabled smart contract dapps can achieve, the Cortex team describes some use cases in their whitepaper:

Information Service • Personalized recommendation system: based on user profile and show / click log in the transactions, to recommend news that matches interest. • Image search engine: based on the image data, retrieve similar images. • News writing: based on the text corpus, to generate a similar style of text. • Automatically summarize: based on the text corpus, to generate a summary.

Financial Services • Credit score: Calculate the credit rating based on the user’s online data. • Intelligent investment advisory: Automatic trading decisions based on financial data.

AI Assistant • Automatic Q&A: chat robot, based on the user dialogue to generate answers. • Industry knowledge graph: expert system, can be used in medical, consulting and other industries • Speech Synthesis: Generate another voice of similar style based on the user’s speech data • Face attribute prediction: based on user-uploaded face data on age, gender, emotion and other attributes to make a judgment

Simulation Environment • The application of reinforcement learning can predict the output of the model through the environment to realize intelligent decision-making and verification for automatic driving, the game Go, games and etc.

Try getting a standard ERC20 if/then ‘smart’ contract todo all that..

AI Released

The Ecosystem in Action

In a nutshell, Cortex aims to create a decentralized open source AI ecosystem. The self-described mission of Cortex is to “provide the best in class machine learning models on the blockchain, enabling users to infer using smart contracts on the Cortex blockchain”. The whitepaper details that this goal is achieved by implementing a machine learning platform that allows users to post tasks on the platform, submit AI models, make inferences by calling intelligent contracts, and create their own AI DApps (Artificial Intelligence Decentralized Applications). Though the layperson reading this may find the techno-jargon a little intimidating, in practice, the ecosystem can be described more simply.

The Cortex ecosystem is comprised of smart contract developers, AI developers, and miners. The smart contract developers come to Cortex to access the AI models’ hash values on a storage layer of the Cortex blockchain in order to enable their smart contracts to benefit from AI functionality. It is akin to taking an underpowered Mazda Miata and performing an engine swap with a Corvette. The resultant product is nearly unrecognizable compared to what rolled into the mechanic bay. The AI developers are compensated in the form of the Cortex token CTXC which they receive from the smart contract developers when their models are used. Finally, the miners both validate and record transactions on the blockchain, and verify the inferred AI results applied to the smart contract.

A couple of key points are worth mentioning in the cycle described above. One of the most promising aspects of Cortex’s proposition is that AI inferences, (or the products of the commissioned AI models), are stored and validated on-chain by way of hash value, (while the key-value storage of the AI models is off-chain). This resolves the trust issue where third-party oracles are involved, and verifies that the inferences produced are indeed valid. Also, the AI developer does not receive payment directly from smart contract developers, but rather receives the royalty in an instantaneous smart-contract settlement split from the transaction fee paid to the miner. This creates an incentive mechanism that encourages AI developers to continually list their most competitive models as the Cortex Virtual Machine identifies the most efficient AI model for a given function, and rewards that developer accordingly. “In Cortex, due to open source and natural competition mechanisms, the best model will survive to enhance the intelligence level of the network. From a machine learning researcher’s point of view, the Cortex platform brings together open models of a variety of basic smart applications with the state of the art quality, which will greatly accelerate their research and drive AI adoptions much faster…”


As was mentioned earlier, Ethereum is far and away the leader in the smart contract space, and have attracted a centralized majority of developer talent to their network. Fortunately, the influence and reach of the Ethereum network was not lost on the Cortex team as the project was being designed. Instead of taking a competitive stance, Cortex designed their Cortex Virtual Machine, (CVM), to be fully compatible with that of Ethereum, (EVM). As a result, ETH smart contract developers can seamlessly migrate their code to the Cortex blockchain to implement AI functionalities. In short, where other smart contract platforms struggle against developer talent flight, Cortex can leverage what is the highest concentration of brain power in Ethereum’s Solidity. “As a stand-alone public chain compatible with EVM smart contracts, Cortex runs both existing contracts and inferred contracts with AI and will survive as a smarter web presence…”

ETH smart contract was not the only nod from the Cortex team to trends in the blockchain marketplace as they announced the integration of Chainlink middleware to connect AI smart contracts to real-world data. The use of Chainlink’s decentralized oracle network guarantees the integrity of input data used in the execution of smart contracts as well as output data. From Tian Jia, the CTO of Cortex Labs, “Cortex aims to create an open-sourced AI ecosystem that needs a broad source of data and a large crowd of audience. Chainlink can greatly help Cortex on both fronts. Further into the future, Cortex may help in optimizing Chainlink’s consensus and routing via on-chain inference”.

A New Age

Looking into the Beyond

As Cortex strives to become the leader in machine learning on the blockchain, a very talented young team looks to meet the challenges ahead. These obstacles include data privacy concerns for which they are considering differential privacy, Zero Knowledge Proofs, and Homomorphic Encryption among other emerging options. Additionally, block size, throughput, and scalability are concerns for which they are considering PoS, DAG, and cross-chain communications among others. In short, a project with ambitions of this scale is bound to meet roadblocks, and in some ways should be measured by the stature of the hardships they face. To date, Cortex presents the most compelling public platform for consumers to access a robust cache of AI models. Though such products may appear to only have agency in the musings of futurists, consumers would be woefully incorrect to assume so. Day by day, the applications we don’t even register as AI sink more deeply into the invisible processes of ‘civilized life’, and access to such technology becomes more fiercely shielded by privately controlled for-profit enterprises. The vast majority of AI patent applications and products are deployed by immense technology firms like Google, Amazon, Facebook, Microsoft, etc., that already shatter corporate influence precedents. Although consumers can appreciate the convenience of Amazon auto-populating prospective items that they may be interested in based on previous browsing history, we are equally chilled when Facebook prompts an eerily timely political add, or when Google pings a product too similar to a browser page that was closed just moments ago. This technology is getting smarter, and as it does, it becomes even more adversarial when solely available to corporate interests who have a fiduciary responsibility to maximize shareholder returns…

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