ChatGPT hit a 100 million users in just 5 days. The hype around it has led to so much usage that it is impossible to use ChatGPT in the evenings. Just as Google revolutionized Internet search way back in 1999-2000, ChatGPI is being touted as something truly transformative. Every day we are bombarded with tips on how to make maximum use of it and are told how it is going to make every job redundant. What is not discussed is how it can help normal people in complex new industries such as crypto where technologies are evolving everyday. This article looks at how AI can help the crypto industry.
AI could potentially be used to create advanced crypto trading bots. With the ability to analyze large amounts of data instantaneously, AI could be used to generate infinite Monte Carlo simulations, which apply random changes to historical trades and then calculate a new equity curve. This new equity curve is then used to verify if the trading strategy is robust. Currently, such technology is available to the biggest fund managers such as Blackstone. AI could potentially level the playing field where individual day traders can use tech that was earlier available only to institutions. This could make it easier for traders to make informed decisions and generate returns on their investments.
AI can be a boon for fraud detection where large amounts of data are analysed and suspicious patterns are identified in real-time. Through real-time monitoring and pattern recognition, AI could detect suspicious patterns. Using Machine learning, AI can learn from past data and cross-reference data from multiple sources, such as transactions, account details, and IP addresses, to create a more comprehensive picture of activity and detect potential fraud.
AI applications such as ChatGPT have the ability to write and review computer code, which has the potential to revolutionize the crypto industry in a number of ways. Steve Jobs once said that the personal computer would be the bicycle for the human brain; AI promises to be the 3500cc Superbike for the brain.
ChatGPT's ability to write and review code also has the potential to lower the cost of software development. By making it easier for anyone to build websites and apps, this could bring the cost of software development to zero, leading to an explosion in crypto projects. This will be especially true for Metaverse, GameFi, and NFT projects, as ChatGPT can help to create engaging environments in Metaverse worlds, come up with compelling storylines for Gamefi games, and brainstorm attractive use cases for NFTs.
AI can help to increase trust in crypto projects and protocols by allowing anyone to understand and audit the code. Because cryptocurrency code is open source, anyone can check to see if a project or protocol is legitimate. However, most cryptocurrency owners have no coding experience and must rely on third-party experts to ensure everything is in order. Anyone, regardless of coding experience, can use ChatGPT to inspect the code of a crypto project or protocol. All you have to do is just copy and paste code from a crypto projects GitHub to ChatGPT which will examine the code.
Another area where AI can benefit the crypto industry is customer service. Currently, customer service for crypto projects and protocols is virtually non-existent, but AI can change that. AI-powered chatbots can provide quick and efficient customer support. This will increase trust in crypto projects and protocols and make it easier for people to use crypto in their daily lives.
AI cryptos have been some of the biggest gainers in recent months, and this is partly because there's currently no way to invest in AI companies directly. Ocean Protocol, for example, aims to create a decentralized platform for data exchange, allowing secure and privacy-preserving sharing of data while ensuring data providers are fairly compensated. Prometheus Network is building a decentralized platform to streamline supply chain management, reducing costs and improving transparency through the use of smart contracts. Fetch.ai is creating a decentralized AI-powered marketplace, where various entities can buy and sell services, such as data, computing power, and storage. Numerai uses blockchain technology and AI to create a decentralized hedge fund, where top data scientists can contribute predictions to be used for investment decisions and earn rewards in Numerai's token.
While AI has the potential to create limitless abundance in the crypto industry, it's not without its issues. One of the biggest concerns is that ChatGPT has built-in biases that prevent it from doing or saying anything that would be deemed unsafe by OpenAI. This means that ChatGPT cannot provide uncomfortable truths, which could limit its ability to help us understand and solve complex problems. Lack of contextual understanding and common sense is another major problem for ChatGPT. Lastly, dependence on data as the model is only as good as the data it is trained on, which means that if the data is biased, incomplete, or not relevant, the model will not perform as well. Additionally, the model's performance can degrade over time, as the underlying data becomes stale.
In conclusion, the potential of AI and crypto to revolutionize lives is immense. With AI's ability to analyze data, create advanced trading bots, detect fraud, lower software development costs and provide customer support AI is brimming with potential. However, there will always be challenges and obstacles to overcome. AI still has limitations such as biases and lack of contextual understanding that must be addressed. As Humphrey Bogart said in Casablanca, this is the beginning of a beautiful friendship.