Will AI spark the next financial bubble?

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Will ChatGPT spark the next financial bubble?

What we can learn from the dot-com era and how to prepare for the next technology gold rush

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Revolutionary technology will always be synonymous with a new way to get rich. With the current growth of Artificial Intelligence (AI), it is fair to say we are looking at another technology gold rush on par with the dot-com boom. And if history and human nature have taught us anything, it is that with every boom comes a crash.

It should be no surprise that entrepreneurs and businesses are utilizing AI technology to achieve profits by solving market needs and cutting overhead costs. Chatbots, Business Intelligence (BI) tools, and even art rendering software such as DALLE-E are becoming standard technology for major companies such as Google, Amazon, and Meta.

The New AI Kid on the Block

While the market has been utilizing AI resources for some time now, one of the most recent AI technologies, ChatGPT, seems to be causing a stir.

ChatGPT is a natural language processing and machine learning system that enables users to chat with a text-based virtual assistant. The system is based on the OpenAI GPT-3 language model and uses advanced algorithms to generate contextual and conversational responses to user queries.

This AI system can provide personalized customer service in settings such as classrooms, hospitals, and even marketing departments. Additionally, it can quickly and accurately process large amounts of data for research and analysis, making it an invaluable tool for businesses and organizations.

Numerous examples are popping up online depicting the capabilities of ChatGPT, from building apps and websites to creating tokens for design systems.

It is clear that ChatGPT has a wide range of potential applications, sparking strong reactions from many people. Some are scared it will replace their job, while others see it as an opportunity to start a business or assist in everyday tasks.

The Next Technology Gold Rush

We must consider how the previous technology revolution unfolded to predict how the future of AI may unravel. The last time we saw this much potential and opportunity from technology was during the internet-related dot-com boom.

The dot-com boom was an era of explosive growth in internet-related businesses, primarily during the late 1990s. It was driven by investments in startups offering products and services over the internet, including web-based businesses, e-commerce, and online services. This period also saw the rapid emergence of many internet-based companies, such as Amazon, eBay, and Google. The boom ended with the bursting of the dot-com bubble in 2000.

The dot-com bubble occurred because of over-investment in technology companies, leading to high stock prices and a rush of venture capital into the sector. The bubble eventually burst when investors realized the companies were not meeting their expectations, causing stock values to plummet.

Similarly, AI will likely spark new business opportunities and economic growth equal to or greater than the dot-com era. Companies and startups will gain a competitive advantage in the marketplace by using AI in their operations, automating processes, analyzing data, and creating new products and services. Additionally, AI-powered companies will have the potential to disrupt existing markets and create new ones, leading to an investor frenzy.

For those apprehensive about a future with AI, particularly designers, it is worth noting that the dot-com era gave birth to the field of web design, which has evolved into what we now call user experience (UX) and digital product design. Just as designers had to learn code and do user research, so will we have to learn how to integrate AI tools into our workflows.

Look Before You Leap

While the rise of AI resources and business is enticing, it could also lead to an outcome similar to the dot-com bubble. Suppose there is an influx of venture capital into over-hyped and overvalued AI companies or new products and services that are not ready for consumer use. In that case, markets may crash when investors and consumers realize the products and companies are not worth what they thought they were.

Businesses and investors should consider the short-term nature of financial markets and remember that AI is a long-term play. Companies must build a sustainable business model rather than relying on stock market volatility. They should also understand the importance of having a solid team and product and ensure that their business is adequately capitalized and has access to the necessary resources to succeed.

The dot-com bubble serves as a cautionary tale for businesses and startups, especially those in the AI space. The bubble demonstrated how quickly and severely the market can collapse when there is a lack of regulation and financial discipline, as well as how quickly investor enthusiasm can wane.


The emergence of AI is an exciting trend that will likely lead to economic growth and business opportunities, much like the dot-com era of the late 1990s. As this great startup boom emerges, ChatGPT is poised to be a significant player in the investment market, providing innovative and powerful solutions to many needs.

Like any gold rush, early adopters and the risk-averse will benefit most, the same way those in the 1990s who had started internet-based businesses did. However, too much investment in AI-based companies and products that are not ready for the market will also lead to a bubble bursting, causing the value of these investments to plummet. Therefore, it is essential to be wary of the potential pitfalls of AI and carefully consider the risks when investing and pursuing opportunities in the sector.

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