June 26, 2024

Crypto Trading with AI – A Comprehensive Guide

Since the launch of Chat GPT at the end of 2022, artificial intelligence (AI) has become a major hot topic worldwide among tech-savvy people and investment gurus alike.

As experts from different fields of specialties try to assess the full spectrum of effects caused by this disruptive technology on our future day-to-day lives, scenarios have arisen ranging from a utopian society with unprecedented efficiency to doomsday predictions portrayed in movies like The Matrix and The Terminator. Its most immediate influence can already be seen in some respects.

In the world of investments, AI technologies and related companies are literally keeping traditional markets afloat. An ever-growing number of individuals, corporations, and even governments are looking to integrate advanced machine learning technologies to improve their workflow and productivity.

But what does it all mean for the world of cryptos as a whole and crypto traders in particular? Is it just another fading buzzword like NFTs, or is this hype here to stay? These are all great questions.

In this blog post, we’ll delve deep into the waters of AI crypto trading.

We’ll start by defining AI in relation to automated crypto trading. Then, we’ll explore these technologies’ capabilities, including their main advantages and limitations. Later, we’ll discuss how crypto traders can access advanced AI tools and some of the best practices for doing so responsibly.

By the end of this blog post, you’ll be equipped with comprehensive knowledge about automated AI crypto trading – what it is, how to evaluate it, where to find it, and how to use it.

So stay tuned! This one is going to be interesting.

Fundamentals of AI Trading

Let’s cover the basics. What does the term AI mean?

The truth is that there is no single definition of AI, as different people tend to interpret it differently, depending on the practice it relates to. This explains the overuse of this concept since AI is synonymous with almost any kind of new technology these days.

In the context of crypto trading, it relates to a variety of wholesome automated trading solutions capable of performing complex tasks that historically could only be done by humans. This is not only limited to the traditional process of gathering and analyzing vast amounts of data, identifying patterns, and managing positions accordingly but also to a more advanced set of capabilities.

Instead of just following a static set of criteria, as complex as it might be, advanced AI trading systems are designed to take full control of the entire process, making them much more autonomous than most automated crypto bots.

This means that, unlike common automation solutions heavily dependent on the quality of inputs and other instructions chosen by the trader, the potential of an AI trading tool is mostly restrained by its own processing power.

In other words, a genuine AI trading solution is designed to operate almost completely independently. From choosing the right data to focus on to find the most reliable technical indicators to follow and the optimal way to act upon them, an elementary feature of AI trading systems is the ability to self-optimize themselves to near perfection without human interference.

If the above sounds too theoretical, let’s proceed to more specific examples to demonstrate these advantages further.  

AI Trading Bots – Advantages and Limitations

While it’s a pretty unanimous viewpoint that artificial intelligence and machine learning technologies have the potential to revolutionize the crypto trading landscape, there is some disagreement about how this process manifests itself in practice.

In this section, we’ll discuss some of the main ways in which AI-based trading models can enhance your trading experience and overall returns, as well as the major inherited drawbacks of these technologies.

Let’s start with the obvious. If you ever had the chance to use an AI-driven tool for recreational use, the first thing you probably noticed was the amazing speed at which these tools can operate. Like the Midjourney platform, where an elaborate input prompt is transformed into a high-quality picture in seconds, AI trading bots can operate at groundbreaking speed.

This is evident not only in the fast pace at which market orders are being executed but also in the unparalleled efficiency with which AI algorithms can process vast amounts of data. By analyzing years of historical price movements in different time frames simultaneously, advanced AI tools can identify repetitive chart patterns and indicators that cannot be detected by less advanced trading tools. This gives traders a cutting edge, enabling them to react faster to changing conditions, both entering and closing positions in arguably the most accurate way possible.

Another big advantage AI-based trading methods possess over traditional trading schemes is their enhanced level of autonomy. Even if they mostly rely on automation, traditional trading methods require constant monitoring and occasional adjustments. From choosing the right technical indicators to fine-tuning their underlying parameters, the ability of AI crypto bots to successfully adapt to rapidly changing market conditions without human interference sets them apart as one of the least time-consuming trading solutions.

This brings us to our next point, which many experts consider a drawback of AI trading systems (or at least something that traders should be aware of). Like most AI products today, even those unrelated to crypto trading, tracking the exact calculations and other computing processes done by advanced AI algorithms is nearly impossible. In other words, except for the output delivered by these programs, the reasoning behind their activities in the market is not available for traders to review. While this is a non-issue when things work smoothly, it makes it more difficult for traders to learn from successes and failures. As a result, it limits their ability to manually interfere with the bot’s workflow. 

Where to Find Your AI Trading Assistant

If you’ve made it this far, you’re probably curious to know how to get a hold of an advanced AI trading solution similar to those we’ve described.

Unfortunately, the answer to this question might be less straightforward than expected.

Currently, no pure AI platforms are open for the general public, like large language models (LLMs) such as Chat GPT or Google’s Gemini. Similar to crypto trading bots and other automated tools, it takes some time from the inception of this technology to reach its democratization for retail traders.

That said, it doesn’t mean crypto traders can’t enjoy the benefits of AI and other machine learning technologies. For those who are truly eager, there are some attractive options available. Out of all of them, arguably the leader in terms of simplicity and overall results is registering as a third-party provider of these trading solutions.   

When we say suppliers of AI trading tools for cryptos, we don’t mean an open AI platform where you can program it as you wish, but rather a subscription-based service that’s well-known across the crypto-verse by the name of signal channels.

In simple terms, signal channels are platforms where expert traders share immediate trading ideas with their audience. These recommendations, often called signals, are derived from the output of sophisticated proprietary algorithms. As part of the AI boom that surrounds us, there’s a surge in the number of signal providers harnessing the advantages of this technology. This enables them to deliver more accurate signals, presenting traders with risk/reward ratios that were unheard of up until recently.

In turn, a signals bots (like the one we provide) automatically convert these trading signals into market orders. Through this swift transformation and execution, traders can rest assured that no opportunity is left untapped and, more importantly, that the earning potential behind each signal received is maximized to the fullest. 

As more AI trading models are being developed almost daily, the inception of this technology into the world of signal channels is consistently multiplying. According to many experts in the field, as these models continue to evolve, proving themselves to be reliable, efficient, and profitable, this trend is only expected to continue in its growth.

Choosing the Right AI Bot for You

The world of cryptos, specifically the signal channels sector, is filled with great products and services but comes with many void promises. With a growing number of trading service providers declaring themselves AI-driven, traders shouldn’t be blinded by fancy buzzwords. Instead, traders should evaluate the different options carefully and do extensive due diligence before choosing a signal channel to subscribe to.

At Cornix, we have years of experience delivering traders with the most reliable crypto bots for converting and executing trading signals. As experts in the field of automated trading, we grew together with the signals trading niche, slowly evolving into one of the leading suppliers of reliable crypto bots and other automated tools for the swift and accurate execution of almost all forms of copy-trading available today.

As we’ve accompanied this market niche from its inception and throughout its consistent development, we’ve slowly been building and maintaining one of the biggest marketplaces for signal channels in the world of cryptos.

All Cornix users get full access to our marketplace, which contains all the leading crypto signal channels available today. Through our platform, traders can contact suppliers directly, review their historical track record, and read other users’ reviews before making an informed decision.

Final words

It is a unanimous viewpoint that artificial intelligence and machine learning technologies have the potential to revolutionize the crypto trading landscape. While this may still seem like an understatement for some of you, it’s also important to remember that, just like any other trading tool, it’s not 100% bulletproof.

At the end of the day, and this may sound a bit counter-intuitive after everything we’ve covered here, you should evaluate the quality of your trading tools not by their level of reliance on AI and ML technologies but rather by their actual results under real market conditions. In other words, don’t fix it if it ain’t broken.  

Here at Cornix, we have a vast collection of automated crypto bots, accompanied by various educational resources and other trading tools, to help you take your trading strategies, AI-driven or not, to the next level.