AI Blockchain – Optimization of the Crypto Market

Artificial intelligence (AI) and machine learning are two of the hottest developments in the technology sector. On the one hand, developments that contribute to the automation of classical processing are exciting. On the other hand, the Alphabet Group’s predictive writing aid is causing some scepticism among users. Nevertheless, the development is making rapid progress and a combination with the block chain (What is block chain?) could well make sense.

Artificial intelligence is developing rapidly

Sometimes the presented possibilities of artificial intelligence (AI) are scary. In addition, every technology has optimization potential, whereby the possibilities of artificial intelligence and machine learning already offer advantages today. Especially scientists and some companies rely on the advantages of these technologies to solve existing problems in a more efficient way. Especially the combination with blockchain technology – also AI blockchain – offers advantages, but until recently it was associated with enormous costs.

For example, some TrainAI uses distributed ledger technology to increase the speed of machine learning without requiring additional computing capacity. DeppBrain Chain and SingularityNET also rely on the decentralization of the block chain to have a cost-effective and neutral solution for hosting the developed artificial intelligence. Another well-known provider is Santiment, which uses artificial intelligence to collect live data and sells it to traders of crypto currencies. All in all, these novel solutions show the potential of bundling these two key technologies.

KI Blockchain to reduce speculation of the crypto market

A look at the year 2017 illustrates the high volatility associated with the market for crypto currencies. Although the adaptation of distributed ledger technology and block chaining in general increased, crypto currencies are still considered a speculative product.

Within this field of application, artificial intelligence and machine learning are gaining in importance, as they can be used in the analysis and forecasting of market data. Projects such as NeuroBot, Senno and ThinkCoin are aimed precisely at this application and are based on the so-called AI block chain. In the long term, investors could benefit from current technological developments and use quantitative market analyses for decision-making. In this application in particular, both technologies offer excellent properties and a high degree of efficiency. However, it should be taken into account that both technologies are used in foreign exchange trading and that there is an urgent need for optimization.

Three approaches to market forecasting using AI Blockchain

Three different approaches have emerged from current projects, which envisage an optimised use of the technologies for forecasting the crypto market. The first approach is called “Persona Matching” and aims to analyse the user profile of a trader. By means of machine learning, the system recognizes the activities of the user and makes investment decisions based on the calculated risk analyses.

This solves the liquidity problem that currently exists in crypto trading. The second approach is called “Sentiment Analysis” and is used to analyze the broad sentiment in the market. Both technologies are used and large amounts of data are analysed for the basic market sentiment. Investments are made based on the results of these analyses. A well-known platform that follows this approach is Senno. According to the company, all analyses should be published so that users can make data-based decisions.

Finally, platforms are currently being developed that use both technologies to develop forecasts and assumptions. A well-known provider of this type of platform is Augur. The company has proven that predictions based on block chain technology and artificial intelligence (AI) are reliable. The use of the Distributed Ledger also allows a higher calculation speed and a higher accuracy of hits. Finally, each platform offers its own advantages and has a right to exist. For investors, the different approaches also offer a way to justify investments.