In recent years, Ethereum (ETH) users and holders of various cryptocurrencies have suffered losses exceeding $2 billion due to cyber incursions and security breaches. Concurrently, the public perception of cryptocurrency has evolved, attracting an influx of users. Traditional code audits have been a mainstay for enhancing security, but Ethereum’s co-founder, Vitalik Buterin, has recently suggested that incorporating artificial intelligence (AI) could further elevate these safeguards. This article delves into the potential and application of AI in code audits.

Current Crypto Landscape

The crypto sector’s most monumental development since its inception is the introduction of Exchange-Traded Funds (ETFs). These financial instruments allow average investors to engage with cryptocurrencies via the stock market, bypassing the need to purchase the digital assets directly. Bitcoin has been a frontrunner in this innovation, prompting questions about Ethereum’s market viability.

However, Ethereum’s potential remains robust. The recent significant upgrade, which drastically reduced gas fees, has reinvigorated the token. Ethereum’s utilization for smart contracts is expanding, with various industries recognizing its value. Consequently, AI-assisted code audits are poised to become a crucial security measure.

The Evolution of AI

AI has been a focal point in the tech investment community, with advancements attracting increased investor interest. This trend is evident in the exceptional market performance of Nvidia (NVDA), a leading chipmaker. Cryptocurrencies leveraging AI are also gaining traction.

The integration of AI in coding and software development is a hotly debated topic, with many anticipating that AI will supplant manual coding tasks. “AI can be trained to recognize and adapt to new information and context, making it more effective at identifying vulnerabilities that may not be covered by static analysis rules,” noted a developer from TokenFi.

Cryptocurrency Losses

In 2023, cryptocurrency users experienced losses nearing $2 billion due to scams, a decrease from the $4.2 billion lost in 2022, thanks to enhanced security measures. Ethereum, the largest blockchain by active users, accounted for $1.35 billion of these losses across 170 security incidents.

Centralized platforms, such as exchanges and trading venues, reported losses totaling approximately $256 million from seven incidents. The most significant of these was an attack that resulted in the theft of $122 million worth of cryptocurrencies, notably impacting the Poloniex exchange.

Challenges in Code Auditing

Several inherent challenges in code auditing are exacerbated by the manual nature of the process, which many believe AI can address.

Manual Auditing Process

Manual code audits involve developers meticulously reviewing code line by line to ensure functionality and security, a process that is labor-intensive, costly, and requires extensive training. Completing a single smart contract code audit can take weeks or even months, a pace that is unsustainable given the rapid onboarding of new users.

Time Constraints

Time constraints are a significant issue for manual code audits. The necessity for a slow, careful approach to scrutinize each line of code hinders project development and the implementation of new features. This is particularly problematic as smart contracts become ubiquitous and cryptocurrencies like ETH integrate into fast-paced work environments.

Human Error

Human error is a prevalent issue in manual code audits. Auditors must repeatedly review code to identify and rectify errors, a process inherently susceptible to mistakes.

The Promise of AI in Code Auditing

AI offers a promising solution to these challenges. By automating the code auditing process, AI can significantly reduce the time and cost associated with manual reviews. AI systems can continuously learn and adapt, identifying vulnerabilities that may elude static analysis rules and human auditors. This adaptability makes AI an invaluable tool for enhancing the security of smart contracts and the broader cryptocurrency ecosystem.