The crypto market is known for its eye-watering volatility. While this extreme fluctuation raises the dangers of crypto trading, it also makes it more profitable than any other type of investment.
As the underlying technology of crypto - blockchain can work in tandem with artificial intelligence (AI) technologies and machine learning systems, AI may generate passive income in a variety of ways when it comes to crypto investing.
Investing in cryptocurrency can pay out handsomely if done right, but there are still risks involved. To reduce that danger, keep in mind that if you don't devote the necessary time to learning about the crypto sector, you risk losing your money. But for those who don’t have enough time to get full scope of information, AI can help them.
Since crypto trading is considered stressful -especially to new joiners-, it can make traders more vulnerable to emotional trading. AI sources data from multiple data aggregators, it can process and decipher all these market factors to come up with purely data-driven trading decisions.
It’s worth noting that by 2028, the worldwide artificial intelligence industry is estimated to have grown to $360.36 billion.
Without any further ado, here are 4 ways that AI can help you make money in crypto relieving you of the burden of having to personally keep up with the markets!
- Market Analysis
AI can conduct market-focused analysis that will lead to accurate predictions which help you come up with trade choices based on data rather than emotions and guesses. This of course still involves work upfront, as you should know how to set the market's parameters to be able to reap the reward over the long haul.
- Market Sentiment Analysis
Sentiment analysis is the application of artificial intelligence (AI) as well as Natural Language Processing (NLP) to examine people's feelings or thoughts on a given issue. When it comes to cryptocurrency investing, a good overall attitude on a digital currency can indicate price increases, while a negative overall sentiment can anticipate price decreases.
AI gathers news, blogs, articles, forums, crypto exchanges message boards, social media posts, and even comments on them. Then processes, and analyzes data to figure if it's negative, neutral, or positive, thus interpreting the markets’ next trend.
- Project Analysis
As we established that the herd impulse, which occurs when a large number of people think and behave in the same way, is responsible for over 90% of all crypto activity. Some AI robots have developed online calculators to assist cryptocurrency investors in evaluating and projecting profits, as well as graphs that clearly represent the trader's gains.
- Execute Trading
Some AI bots allow users to automate the trading process and execute high-frequency trades. Market orders are executed on your linked exchange by these AI-powered bots, and limit orders are relayed accordingly. The bot then performs the stop loss and take profit commands once the order has been filled. This can help novice crypto traders earn money or double their investments without even diving into the market analysis too much.
