Home Technology Machine Learning Artificial Intelligence and Price Discovery of Bitcoin Ethereum and Others

Machine Learning Artificial Intelligence and Price Discovery of Bitcoin Ethereum and Others

Price Analysis of cryptocurrencies with Artificial Intelligence is expected to dramatically decrease the investment risk associated with crypto investment. Studies are ongoing with advanced artificial intelligence frameworks of fully connected Artificial Neural Network (ANN) and Long Short-Term Memory (LSTM) with Recurrent Neural Network to analyse the price dynamics of Bitcoin, Ethereum, and Ripple.

Deep learning as a subset of machine learning, is a neural network with three or more layers. These neural networks try to simulate the behavior of the human brain and “learns” the behavior from large amounts of data of how cryptocurrency investors react in different market situations and on how the price is decided.

Deep learning networks discover intricate structures in the data they experience. Further, they build computational models with multiple processing layers and eventually, the networks will be able to create multiple levels of abstraction to represent the data.  Interpreting large amounts of data with Deep Learning and deriving a meaningful information is important for price discovery of cryptocurrencies.

There are several price prediction models already proposed based on the deep learning technology. The entire purpose is geared towards helping cryptocurrency holders make profits in making right entry and exists making profits when trading with cryptocurrencies.

The computation model is trained with large amounts of data where the dataset is normalized, data is reshaped, and the algorithm based on the loaded data provides cryptocurrency price signals and indicators to buy and sell. Several organizations are using algorithms to predict the price of crypto. Hybrid deep learning models are being studied to predict the future price of Bitcoin, Ethereum and a range of cryptocurrencies.

Though machine learning has been widely used in predicting cryptocurrency prices with different computational models there has not been much success in arriving at accurate price prediction.

The technical analysis basically depends on the idea that crypto prices will follow trends and the trends will repeats themselves. Thus, analysts mainly focus on examining the price movements and trading volumes to forecast the future directions of crypto price, whether it will go up or fall in the future. However, now with artificial intelligence a similar result will show up by it should be synched with other sentimental attitudes of investors and influencer statements and the impact of news and several other peer statement based decisions which are made by cryptocurrency investors.

Trending: Cryptocurrency algorithm or hashing algorithm, which encrypts cryptocurrency and some algorithms can be used in multiple cryptocurrencies as the numbers of cryptocurrency these days exceeds the number of existing algorithms.

 

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James

James T, a passionate crypto journalist from South Africa, explores Litecoin, Dash, & Bitcoin intricacies. Loves sharing insights. Enjoy his work? Donate to support! Dash: XrD3ZdZAebm988BfHr1vqZZu6amSGuKR5F

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