In a recent call with UBS analysts, Emad Mostaque, the CEO of open-source AI company Stability AI, made a bold claim, stating that artificial intelligence (AI) would become the “biggest bubble of all time.”
Mostaque expressed his belief that the AI industry is still in its early stages and not yet ready for widespread adoption in sectors like banking.
Referring to it as the “dot AI” bubble, Mostaque highlighted that the phenomenon had not even begun to reach its full potential.
Stability AI is known for its popular generative AI tool called Stable Diffusion, which allows users to generate photo-realistic images based on text inputs.
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With over a million users and significant investment from Coatue and Lightspeed Venture Partners, Stable Diffusion has gained significant traction in the market.
However, Mostaque has faced allegations of making misleading claims regarding his background, achievements, and partnerships.
In response to these accusations, he provided a detailed rebuttal on his personal blog, refuting each claim one by one.
Generative AI, a more recent development, has garnered attention for its ability to create human-like language and visual content from scratch, driven by extensive data inputs.
While AI technology has already become prevalent in online browsing, social media platforms, and home assistants, generative Artificial Intelligence tools such as ChatGPT, Google Bard, Microsoft Bing Chat, Dall-E, Stable Diffusion, and Midjourney have opened up new possibilities for various industries, including medicine, transportation, science, finance, and defense.
Mostaque emphasized that the total investment required in AI would likely surpass $1 trillion, highlighting its importance as infrastructure for knowledge.
He suggested that major financial institutions, including UBS, would have to adopt AI technology to remain competitive in the “massive market” it represents.
However, Mostaque also acknowledged that AI is currently in the early stages of development.
While the potential value is evident, he stated that large-scale deployment within industries like financial services is not yet viable.
He warned that companies failing to utilize AI appropriately would face consequences in the stock market, citing the example of Google+, which incurred a $100 billion loss in a single day due to inaccurate information provided by its Bard AI chatbot in a promotional video.
Noting the intense competition between Google and Microsoft in the race to build superior AI tools, Mostaque emphasized the significance of AI as an investment theme in the coming years.
“This will be one of the biggest investment themes over the next few years,” Mostaque concluded, underlining the transformative potential and market impact of AI technology.