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Has AI’s Role In The Crypto Space Lived Up To The Hype?

 Human nature is programmed to fixate on trends and when it comes to technological, there is none as phenomenal as the emergence of AI as an ideal solution to our shortcomings. As such, it is not surprising that the world we live in today is embroiled in integrating this technology into existing industries in what is fondling referred to as the fourth industrial revolution.

Similar to the disruptive capacity of AI, Cryptocurrency has shown that it has as much innovative leverage as AI to kick start a new order of solutions that could establish the concept of decentralization as the de facto structure of the future economy. Although each possesses unique innovative capacity, it is possible to combine them to create even more formidable and groundbreaking solutions.  

As expected, this possibility has fueled so much buzz that is becoming difficult to separate speculations from viable projects. More alarming is the fact that startups have the knack of capitalizing on the demand of both technologies without necessarily having the resources and foresight to deliver on their promises.

Without any doubt, cryptocurrency and AI stand as two of the most demanded technologies in the world and at a point, implementing any of the two into a project automatically improves a startup’s chances of raising funds. In light of this, we shall highlight the realistic benefits of AI integrated solutions in the crypto space and whether or not they have lived up to the hype.

The Potential Of AI And Crypto Is Limitless

The aforementioned fourth industrial revolution basically highlights the various ways today’s technologies are processing and utilizing the vast amount of data we generate. This endless cycle of data needs efficient tools that are less-restricted than the human brain, in order to generate error-free analytics and instantaneous and yet accurate response.

Being that AI is the ultimate analytic tool and crypto’s underlying technology (blockchain) can facilitate immutable databases, it is obvious that both technologies have found themselves complementing the strength of the other. Already, developers are increasingly adopting AI as a viable solution to various crypto trading processes and the progress made so far suggests that we are up for more influx of AI solutions in the crypto space.

How Is AI Improving Crypto Trading?

Arbitrage

It is common for cryptocurrencies to experience spikes and sometimes the volatility could lead to disparate prices on crypto exchanges. While this is a given, these spikes are short-lived and so traders that are interested in utilizing this strategy must identify and enter trades in a matter of seconds.  

In order to capitalize on the price difference of an asset on one or two exchanges, traders are now utilizing AI-enabled tools that would instantaneously identify these disparities and facilitate trades that would look to make profits from it.

Forecast And Predictions

With AI, it is becoming easier to predict price movements as it effortlessly uses mathematical models and historical price data for less error-prone decisions. This functionality is similar to the role AI is playing in traditional markets where it has access to an astounding array of historical data.

Scalping And High-Volume Trading Activities

Scalping and other trading intensive strategies entail the monitoring and execution of trades round the clock and this is only possible with the help of automated trading tools. Traders can set up algorithms that would govern the activities of these bots. Also, these algorithms would ensure that they don’t miss out opportunities of profiting from short price movements while eliminating the human factor.

What About AI-Powered Crypto?

Apart from the emergence of AI-enabled crypto trading solutions, the compatibility of AI and crypto has led to the emergence of AI-powered cryptocurrency networks. These networks combine the transparency and security feature of the blockchain technology and the automation function of AI to create highly sophisticated crypto solutions.

As a result of this innovative approach, we are beginning to see new crypto platforms that could rival the effectiveness of conventional systems while ensuring that decentralization and privacy remain the bedrock of their operations. For example, DeepSee is integrating AI and Blockchain so as to create a social media network that would eliminate fake news while encouraging users to create quality contents.

In solutions like the aforementioned DeepSee, machine learning mechanisms are introduced as an analytic tool for the array of data on the blockchain. As such, it is possible to automate the sharing and verification of data and also ensuring that the encryption function of blockchain secure such data from unauthorized access.

Bottom Line

A closer look at the growth in automated crypto trading and the explosion of AI-powered cryptocurrencies are clear indications that the hype surrounding this trend is not a fluke. Nonetheless, since we are yet to fully capitalize on the innovative capacity of both technologies, it is certain that we are still a long way from realizing the true potentials of combining the remarkable functionalities of both technologies.

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