5 ways ChatGPT can help with crypto trading

Throughout late 2022 and early 2023, ChatGPT and its incredible AI capabilities became a common theme. Millions of people are interested in this chatbot and use it for a variety of reasons. But can crypto traders also make use of this new and innovative technology? How can ChatGPT help you in crypto trading, and what risks should you be aware of here?

1. Gives you market statistics

Crypto traders and investors rely on market statistics, such as prices, trading volume and supply, to make decisions about which assets to buy or sell. Cryptocurrency prices are incredibly volatile, so it can be difficult to keep track of how a given asset is doing.

Although there are several apps that you can use to track crypto stats, there is another better option available to you. You can always go to ChatGPT and ask it your own, personal question about the crypto market, instead of just checking up on general numbers. This allows you to access tailored questions about cryptocurrencies, DeFi trends and more. This can be anything from simply checking your favorite asset’s current price, to assessing the trading volume of a crypto exchange you wish to register for.

2. Explain complex crypto topics

The world of crypto and decentralized finance (DeFi) is by no means easy to understand. This industry is filled with different services, assets and technological concepts, which can be overwhelming for those just starting out. In fact, the sheer volume of knowledge you need to understand cryptocurrency can easily put people off, making it somewhat inaccessible to many.

This is where ChatGPT can come in handy. ChatGPT is a fantastic resource for all kinds of information, including crypto and DeFi. If a certain concept is confusing you, ChatGPT can help break it down into simpler terms, while allowing you to ask the questions that matter to you.

For example, you may understand how crypto mining works, but not why it is important to blockchain security. Or you may have a more niche question about a particular resource that you can’t find an answer to via your usual search engine. Asking ChatGPT can streamline the process, giving you instant information without having to scroll through endless search results.

3. Gives you an asset history

If there’s one thing you can be sure of with cryptocurrency, it’s that no asset price can remain constant over an extended period of time. Whether it is minimum or maximum, the price of any given crypto will change several times a day as the market changes. An asset’s moving price history can indicate whether it is set to do well.

Although this is not always the case, certain assets show recurring trends that ChatGPT can pick up and relay to you. So if you are interested in buying a type of cryptocurrency but first want to review the history, try asking ChatGPT for a quick overview.

This can help you decide if the crypto in question is a solid investment option for you. For example, a token may be doing very well, but ChatGPT informs you that it has only recently recovered from a price drop. Or an asset may struggle, but ChatGPT informs you that this is very unusual.

On top of this, you can use ChatGPT to learn the background of an asset or project to ensure there are no suspicious elements about it. Scams are rife in the crypto industry, so it’s always worth having some background knowledge about what you’re investing in.

4. Make market predictions

Crypto prices are anything but predictable. An asset’s value can skyrocket or plummet in a matter of days, so it is important to be as prepared as possible for such unexpected changes.

While there’s no way to know for sure what’s going to happen next in the crypto space, predictions can be helpful. Because ChatGPT has access to such a broad base of information, it can play a useful role in helping you understand how the market is expected to change in the coming weeks, months or years.

For example, you can ask ChatGPT what cryptos are coming, or ask how Bitcoin will perform in the next year. Alternatively, you may want to find out which cryptos are destined to fail, or which may soon see a healthy price increase. There is no end to the questions you can ask ChatGPT about the future of the crypto market.

However, it is important to note here that crypto predictions are not always accurate. Many crypto traders and enthusiasts have made price forecasts, which only resulted in a completely opposite result. It is unwise to take predictions as fact, as this can come back to bite you. So it might be better to use ChatGPT to understand market forecasts, not invest in them.

5. Keeping you updated on crypto news

The crypto market is large, diverse and constantly changing. Every day there are new developments, launches and scandals within the industry and it is important to stay abreast of these stories if you are an avid trader or if you frequently use crypto and DeFi platforms.

It goes without saying that there is a lot of crypto news out there today, but sifting through every website and article for important information can be time-consuming. So if you want news more specific to your crypto space, try asking ChatGPT. This chatbot can provide you with current stories and updates so that you can stay on top of how the crypto market is changing.

An important note about ChatGPT and accuracy

While ChatGPT can certainly provide you with vast amounts of information on the crypto space, there is also a stipulation here. There are many unreliable news sites out there today, where ChatGPT can pull information to formulate its responses.

Fake news and misinformation is a common problem across the internet, and it also affects AI-based resources like ChatGPT. In the crypto market, unreliable data can give way to unwise investments, poor judgment and more.

So it might be a good idea to fact-check the information provided to you by ChatGPT as there is a chance that the chatbot may be giving you data from less reputable sources.

ChatGPT can be useful in crypto trading

Obviously, ChatGPT can be a useful resource in your crypto trading, but it’s important to remember that there is a lot of misinformation circulating online. So if you want to use ChatGPT for crypto stats, news or predictions, be sure to fact-check the chatbot’s answers to make sure you’re not being misled.