Crypto trading platform NewsCrypto has announced that it is rolling out an AI-powered market prediction tool.
The software, which enables users to track and analyze chatter around top digital assets using social media sentiment, has been in development for a number of months.
NewsCrypto will add the tool to its existing product lineup, which includes a trading suite, mobile wallet, and cross-chain swap mechanism.
Earlier this year, the platform launched its native NWC token on two new blockchains – namely Binance Smart Chain and Ethereum – to give the asset greater utility in the booming decentralized finance space.
Scanning Socials to Slam Dunk Trades
NewsCrypto’s latest product relies on machine learning to extract data aggregated from social media and news sources, and is designed to help lighten the research load for traders.
While many traders manually collate insights from a combination of free and paid-for pro tools to gauge market sentiment and make trades at opportune times, the price prediction tool extracts useful data from the noise based on how past posts affected the market itself.
It then applies the model to forecast the future price of each of the top 20 digital assets, from Bitcoin (BTC) and Ethereum (ETH) to Polkadot (DOT) and Ripple (XRP).
The maiden version of the AI tool will harvest insights from textual sources such as tweets and news articles, though plans are in the works to release an upgraded version capable of analyzing video sources (YouTube clips) and audio (podcasts).
The software is said to be sophisticated enough to measure tone of voice to give traders more actionable insights.
The potential for assets to move in an upward direction will be categorized based on perceived market tone, with levels encompassing Enthusiastic, Very Good, Good, Neutral, Bad, Very Bad, and Fearful.
To harmonize and quantify chatter, NewsCrypto’s tool will take into account factors such as who commented, their follower count, and other metrics related to performance. It will also corroborate information with real-time market activity to assign value to each tweet or article.
The Expanding Role of AI and Crypto
NewsCrypto is not the first company applying artificial intelligence to the Wild West world of crypto trading. Last year, Nomics, a provider of crypto market capitalization and pricing data, unveiled an AI system that makes seven-day crypto price predictions.
The software utilizes a machine learning model known as long short-term memory (LSTM), with weekly price predictions for each crypto-asset freely available on the website.
The Crypto Forecast app also uses AI to generate hourly and daily price predictions, based on sentiment analysis and market data.
Making a consistent profit in the notoriously volatile cryptocurrency space is a challenge.
NewsCrypto and others are looking to develop AI-driven strategies that help users gain a competitive advantage, whether the market is bearish or bullish.
The same idea lies behind copy trading, also known as mirror trading, a feature that lets novice traders mimic the movements of more experienced traders.
Needless to say, the proof will be in the pudding for NewsCrypto’s latest offering. The days of traders channeling their instinct may be coming to an end.