The CEO of cryptocurrency exchange Phemex, Federico Variola, stated that artificial intelligence (AI) has become a "generally negative" factor for the crypto industry. According to him, AI has diverted capital away from cryptocurrencies and also facilitates attacks on protocols. Variola noted that rising cybersecurity costs could push the sector towards greater centralization.
Speaking on Cointelegraph's "Chain Reaction" program, Variola said it is difficult to be optimistic about AI's impact on the crypto industry: "Liquidity has largely flowed into this sector. On the other hand, AI has armed many bad actors who exploit protocols." He said it is hard to imagine a world where AI would favor the crypto industry, as many "fixes" tend to encourage centralization rather than reduce it. Separately, Variola reminded that in February, his exchange announced an AI transformation – plans to integrate the technology into product development and internal operations.
He pointed to an incident in July when hackers stole about $116 million in bitcoins from more than 5,200 addresses due to a vulnerability in the Coldcard hardware wallet, which is widely believed to have been identified using AI. At that time, Coinkite CEO Rodolfo Novak warned developers that the "sobering reality" is that AI-assisted code review can now find vulnerabilities faster than the industry's most experienced experts. Variola added that small teams working on protocols can no longer do without a large cybersecurity budget.
He also warned that AI-related threats could make self-custody and DeFi less attractive. "As AI spreads – whether it's hacking devices, social engineering, or other strategies that empower attackers – DeFi becomes much less attractive to the retail user because there are many things to worry about that weren't a concern before," he said. Meanwhile, security experts note the defensive potential of AI: CertiK senior blockchain researcher Natalie Newson told Cointelegraph in April that "AI can also be one of the main defenses," although she warned that the technology makes attacks more complex. Despite his overall assessment of AI's impact, Variola sees practical benefits in AI agents – for example, to assist investors in building portfolios or making trading decisions. However, he does not expect agents to completely replace human decisions: "Ultimately, the decision will still be up to the user. I don't think agents will ever replace that action – making the deal."
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