ChatGPT: what it is and how it can help you

ChatGPT AI has taken much of the globe by storm. From the world of work to teaching and the arts, almost no area of human activity has escaped questions about what highly sophisticated AI could mean for the future. This includes cryptography, which recently also had fun imagining how it could leverage the creation of OpenAI, which uses natural language processing, reinforcement learning, and copious amounts of data to arrive at disturbing text-based responses.

On the one hand, numerous traders have asked ChatGPT to write code for trading bots for them, so that they can simply sit back and watch their portfolios automatically increase in value (at least in theory). At the same time, others asked the chatbot for its “opinion” on cryptocurrency trading, from what is the “best” token to buy to how to sell ETH to a Bitcoin maximalist.

Given how surprisingly powerful and creative ChatGPT is, its arrival begs a question: Can ChatGPT be used to get rich trading cryptocurrencies? Well, while it’s actually a useful source of cryptocurrency information (at least for inexperienced traders), it won’t give you the secrets of the cryptocurrency market and for a variety of reasons. That said, if you’re tech-savvy enough to build a trading bot with it, it could help you generate modest returns, provided the market itself doesn’t hold some surprises.

Ask ChatGPT how to get rich trading cryptocurrencies

Let’s get straight to the big million dollar question: can ChatGPT tell you which cryptocurrencies to invest in or which trading strategies to follow to have the best chance of making a profit trading cryptocurrencies?

The answer to this question is: yes and no. As the screenshot above reveals, ChatGPT constantly avoids choosing a “favorite” or “best” cryptocurrency to invest in, providing the explanation that “the value of digital currencies can be highly volatile and depend on a variety of factors.”

Similarly, if you ask which of the two cryptocurrencies is better as an investment (e.g. bitcoin vs ethereum), it won’t name a particular coin as “superior.” However, it is precisely here, when you start to be more specific with your questions, that it actually becomes more helpful and informative. In the case above, it provides a rather timely summary of the key differences between Bitcoin and Ethereum, something that can help the user decide which of the two to focus on.

Going further in this direction, you can also try to ask him for even more precise advice, such as “What characteristics of a cryptocurrency should I consider before investing in it?” This produced the following useful explanation:

Using your imagination, there are potentially many, many things you could ask ChatGPT to gain a sharper sense of how to navigate the cryptocurrency market. For example, asking “How can I get rich in cryptocurrencies?” produced this point-by-point rundown of things that any self-respecting trader should be aware of or do.

Unfortunately, if you continue to subject ChatGPT to this line of questions, you will soon encounter one of its main weaknesses, which is that it seems (at least for now) to have only a limited repertoire of potential answers on a given topic. This is illustrated in the screenshot below, which asks a different question but gets more or less the same answer, except for a few welcome additions.

To be honest, if you’re just starting to invest in cryptocurrencies, such information can come in handy to put you on the right track. Of course, the obvious rejoinder here is that 99% of the information provided by ChatGPT can easily be found on any decent crypto-related website (like this one), so it doesn’t seem useful – at least at this stage of human evolution – to go out of your way to seek the “advice” of an AI chatbot. In fact, the advice here is very general and doesn’t provide anything along the lines of “Buy XRP on January 23rd: It’s about to skyrocket.”

In other words, anyone hoping for a silver bullet will be sorely disappointed with ChatGPT, but it still raises the possibility of a future where even more sophisticated and intelligent AI can provide more personalized and actionable advice to investors. For now, we must continue to do all the important work on our own, for better or worse.

ChatGPT Crypto Trading Bots

Despite ChatGPT’s limitations, this hasn’t stopped the cryptocurrency community from attempting to get miles out of OpenAI’s small chatbot. Some investors did something similar to the above and asked him for general advice, while others went so far as to have him write code for the trading robots they could use.

In fact, some people claimed to have made big profits using the trading robots they put together using ChatGPT, with one trader on TikTok making the dubious claim that he earned over 2,000% profit. This, of course, should be taken with a huge pinch of salt: a more reliable – and detailed – AI-focused YouTuber built his own trading bot with ChatGPT and made a profit after 24 hours of a modest 1.62%.

Therefore, using ChatGPT in this way would probably not help you become rich in cryptocurrencies and may not be better than simply devising and executing a strategy yourself. There’s also the fact that you’ll need some coding experience to actually take ChatGPT’s responses and turn them into actually usable code, as AI often simply provides a high-level outline of the steps you should take, rather than a complete set of instructions.

Finally, even if
ChatGPT could write a trading bot for you, and even if it was trained on huge amounts of past data, this would still not guarantee profits. This is because of the simple and ancient rule that the past does not guarantee the future, and that models that have endured in previous years can be easily interrupted by any kind of Black Swan-style event that exists outside of previous models.

In other words, the exciting thing about the cryptocurrency market is that it can never be predicted with much accuracy, and this is something that even the most incredibly intelligent AI will never change.

Inline Feedbacks
View all comments
pexels karolina grabowska 6328941

3 lessons on the collapse of cryptocurrencies in 2022

bitcoin g158380430 1280

How long should I keep Bitcoins?