ChatGPT has been garnering attention for its impressive capabilities, which include generating natural language responses, completing tasks, and even writing programming codes. This has led to increased interest in the potential of its applications in various fields, including finance, healthcare, and content creation.
With its ability to process and analyze vast amounts of data, ChatGPT is being seen as a valuable tool in the field of cryptocurrency trading as well. As the demand for automated trading solutions grows, ChatGPT’s sophisticated technology is poised to play an increasingly important role in this fast-paced market.
In this article, we will explore what ChatGPT is and how its technology can help with crypto trading.
What is ChatGPT?
ChatGPT is a large language model developed by OpenAI based on the GPT-3.5 architecture. It is one of the most advanced AI models for natural language processing (NLP) and has the ability to understand and generate human-like text, making it a powerful tool for a wide range of applications, including crypto trading. It has seen huge interest from the general public since its November 2022 release. According to reports, it reached 100 million users after just two months.
There are several factors that make ChatGPT stand out among other AI models. One of the most significant factors is its state-of-the-art technology. It is based on the GPT (Generative Pre-trained Transformer) architecture, which uses deep neural networks to process and understand language. It has a massive number of parameters (175 billion as of 2021), which allows it to process and generate more complex responses than previous language models. It also uses unsupervised learning techniques, which means it can learn and adapt to new tasks and data without human intervention. All of these factors make ChatGPT one of the most advanced language models to date.
As one of the most advanced language models to date, ChatGPT has the ability to understand and generate human-like responses to various tasks. This has opened up new possibilities for businesses, researchers, educators, and individuals looking to automate certain tasks and streamline their workflows.
Additionally, its ability to perform a wide range of natural language processing tasks, such as language translation, summarization, and conversation generation, sets it apart from other models that may only be specialized in a few specific tasks. ChatGPT’s open-source nature and availability to developers also contribute to its popularity and flexibility in various applications.
Accessibility is another significant advantage of ChatGPT. Anyone with an internet connection can use it, which makes it highly accessible to businesses, researchers, educators, and individuals across the globe. This has opened up new possibilities for smaller businesses and individuals who may not have had access to advanced AI technology in the past.
Finally, ongoing development is another reason why ChatGPT remains a hot topic of discussion. As new updates and improvements are made, it will continue to evolve and remain relevant in the world of AI. This means that there will always be new possibilities and opportunities for anyone who is interested in AI technology.
The history of ChatGPT dates back to 2018, when OpenAI introduced the first version of the GPT model, which was designed to generate human-like text using a massive dataset of written language. Since then, the model has undergone several upgrades, with each version increasing in size and capability.
In June 2020, OpenAI introduced GPT-3, the latest and most advanced version of the GPT model, which has 175 billion parameters, making it the largest and most powerful language model to date. Current free version of ChatGPT is based on the GPT-3.5 architecture, which is a modified version of the GPT-3 model optimized for text-based conversations.
On March 13 2023, ChatGPT-4 was officially announced, however, it is only available in the ChatGPT Plus paid subscription, which costs $20. ChatGPT-4 has already been integrated into a number of projects, such as Duolingo, Stripe and Khan Academy, to name a few.
ChatGPT is capable of understanding and responding to natural language inputs, allowing users to have interactive conversations with the model. It has been trained on a vast corpus of text data, including news articles, books, and other sources of information, giving it a broad understanding of language and the ability to generate accurate and relevant responses to a wide range of queries.
Some of the languages that GPT has been trained in include English, Spanish, French, German, Italian, Portuguese, Dutch, Russian, Chinese, Japanese, and Korean. In fact, it supports 95 different languages; however, GPT may sometimes provide answers inaccurately depending on the language you use, so it is best to stick to widely-spoken languages since with them GPT can be more precise.
Why is everybody talking about ChatGPT and AI?
Artificial intelligence has become a buzzword in recent years, and ChatGPT is no exception. ChatGPT, in particular, has gained popularity as a powerful language model that can process vast amounts of data and provide insights into various topics, including finance, healthcare, and even creative writing.
Furthermore, the rise of big data and the availability of cloud computing have made it easier and more cost-effective to implement AI solutions. As a result, companies are investing heavily in AI research and development, hoping to gain a competitive edge in their respective markets.
One reason people are interested in ChatGPT and AI in general is the potential for these technologies to improve efficiency and accuracy in various industries. For example, in finance, AI can help traders analyze market trends and make better investment decisions, while in healthcare, AI can assist in diagnosing diseases and developing personalized treatment plans.
Another reason people are interested in AI is the possibility of creating more advanced and autonomous systems. Self-driving cars, for instance, are becoming more common as AI technology advances, and many experts believe that AI could revolutionize the way we live and work in the future.
However, with the potential benefits of AI come concerns about the ethical implications of developing intelligent machines. There are questions around accountability, transparency, and the potential impact on employment and society as a whole. Despite these concerns, interest in ChatGPT and AI continues to grow as people explore the possibilities and limitations of these technologies. That being said, what exactly is ChatGPT capable of?
What Can ChatGPT do?
ChatGPT wouldn’t have become so incredibly popular if it wasn’t so helpful in a variety of use cases. Still, to utilize ChatGPT for some of the use cases, especially those that rely on data and numbers, you would need to access its API through a third-party platform or build your own. Many platforms offer pre-built ChatGPT models that can be customized to fit specific use cases (e.g. PowerBrainAI app). Additionally, you would need to provide data to train the ChatGPT model for your specific use case and continually refine the model over time to improve its accuracy and effectiveness.
However, in such cases as content creation, writing letters, or answering general questions, all you need to do is make your request as precise as possible so ChatGPT can generate the textual content you need.
So how can people use ChatGPT in their activities?
- Language-based tasks: ChatGPT excels in a wide range of language-based tasks, such as summarizing long texts, answering questions, and performing language translations. For example, a news organization could use ChatGPT to summarize lengthy articles for their readers, while a customer service team could use it to answer frequently asked questions in multiple languages. ChatGPT can also be used to create chatbots for websites and messaging platforms.
- Content creation: ChatGPT can be used to generate content for various purposes, including blogs, articles, and social media posts. It can help writers and content creators come up with new ideas and even generate entire articles or blog posts. For example, a marketing team could use ChatGPT to generate social media posts or create a content calendar for their blog.
- Customer service: ChatGPT can be utilized to provide quick and accurate answers to customer inquiries, reducing the workload on customer service representatives and improving response times. For instance, an e-commerce company could use ChatGPT to handle common customer service queries like tracking orders and handling returns.
- Personal assistants: ChatGPT can act as a personal assistant to automate repetitive tasks like data entry, scheduling, and reminders. For example, a busy executive could use ChatGPT to schedule appointments and remind them of upcoming meetings.
- Data analysis: ChatGPT can analyze data and assist with research by identifying patterns and relationships in data sets. It can also help automate data entry and analysis tasks, freeing up time for researchers and analysts to focus on more complex tasks.
- Financial analysis: ChatGPT can help with financial analysis to analyze market trends, predict stock prices, and assist with investment decisions. For instance, a financial institution could use ChatGPT to analyze market data and provide insights into potential investment opportunities.
- Education: ChatGPT can be used in education to create personalized learning experiences for students by generating quiz questions, providing feedback, and grading papers. For example, a language learning platform could use ChatGPT to generate personalized quiz questions based on a student’s previous answers and provide real-time feedback on their progress.
- Writing codes and smart contracts: ChatGPT has the ability to write simple codes and smart contracts on Python, C++, Solidity, Vyper and other languages. However, the complexity and security of the code or smart contract will depend on the developer’s understanding of the programming languages, blockchain technology, and cryptography, and ChatGPT can only provide basic guidance and examples.
Since ChatGPT is capable of writing codes and can even create a smart contract, does that mean that it will replace Solidity and Vyper developers? And does that mean that literally anyone would be able to develop a dApp without knowing even the basics of programming?
According to Marius Grigoras, CEO of crypto launchpad BHero, there is nothing to be worried about. In his opinion, “While ChatGPT’s ability to write simple smart contracts is an impressive feat, it is unlikely to pose a significant threat to Solidity and Vyper developers in the foreseeable future.
The development of smart contracts requires not only the ability to write code but also a deep understanding of the underlying blockchain technology, as well as an appreciation of the legal and financial implications of the contract. ChatGPT, while adept at generating basic smart contracts, lacks the human intuition and expertise necessary to create complex, secure, and legally compliant contracts.”
Sandra Grabowiec, growth manager at Cogito Protocol, also thinks that way: “Programmers should be fine with ChatGPT as it won’t replace them soon. Instead, they should learn how to utilize it to their advantage because such LLMs are great assisting tools. The problem is that they shouldn’t input proprietary code in the chat; that way, they expose themselves to high risks. There is a way to use APIs, but it only mitigates some risks.”
What ChatGPT Cannot Do?
Even though it might look like ChatGPT’s abilities are limitless, it still has quite a few weak points. Let’s take a look at some of them down below:
- ChatGPT’s current free version of 3.5 cannot understand or interpret non-textual data such as images or videos. ChatGPT-4 version, however, can understand and interpret images.
- ChatGPT for now cannot fully understand the context and nuances of every conversation, at least with the current version. ChatGPT operates based on statistical patterns and correlations present in the training data. This means that it may struggle to understand the context or meaning of certain conversations that diverge from the patterns it has been trained on.
Additionally, the model’s ability to understand and respond to certain nuances, such as sarcasm or humor, is limited and may result in inaccurate or inappropriate responses. - In terms of financial analysis, ChatGPT is limited by its inability to make decisions on behalf of traders or provide specific financial advice. While it can provide insights and predictions based on historical data, it cannot take into account current events or market conditions that may impact the accuracy of its predictions.
- While ChatGPT is capable of processing large amounts of data and generating insights, it cannot replace the intuition and decision-making abilities of human experts. It lacks the ability to make judgments based on personal experience and expertise, which is often necessary for complex decision-making.
- ChatGPT cannot account for unpredictable or unexpected events that, for instance, may impact the markets. While it can analyze historical trends and patterns, it may not be able to predict or account for unforeseen events that may impact market performance.
- Even though ChatGPT can generate responses and text based on its training data, it is limited in its ability to generate entirely new ideas or thoughts. It may not be able to generate truly original content or ideas that have not already been present in its training data.
But what about ChatGPT in crypto trading? Is there any way it can help traders in their trading routine? Let’s see what experts and technologists think about this idea.
ChatGPT In Crypto Trading: A Near-Future Trend?
Artificial intelligence is set to revolutionize various industries, including trading. There’s great potential for its use in the field, but it’s essential to evaluate what’s currently possible.
At a first glance, it seems that AI in general and ChatGPT in particular will become a part and parcel of crypto trading in the near future. However, it’s not that simple. Let’s take a closer look at where we stand now.
Nina Wess, data scientist from BowTied_Raptor thinks that “We can expect AI technologies, including ChatGPT, to play a role in crypto trading in the near future. AI has already been making inroads in the financial sector, and its use in analyzing market trends, generating predictions, and offering trading recommendations is expected to grow.”
Daniel Chabert, CEO and Founder of PurpleFire also thinks that way. In his opinion, “It is possible that in the future, ChatGPT and AI could replace numerous data sources. ChatGPT and AI can be used to aggregate data from multiple sources such as news outlets, financial institutions, research firms, etc.”
In particular, we can expect that in the future ChatGPT will do all the chart reading by itself. According to Chabert, it is possible that in the future “AI can also be used for tech analysis, such as pattern recognition and trend forecasting, which could be of great help to traders. ChatGPT and AI could also be used to create automated trading systems that are capable of making trades without any human input.”
However, it would be too early to say that ChatGPT will become an ultimate tool for crypto trading, since it has quite a few issues regarding its reliability.
Teodor Brebeanu, developer from PowerBrainAI – an iOS and Android app that is powered by ChatGPT – believes that ChatGPT probably will never be a flawless assistant in crypto trading.
He thinks that “It’s important to remember that no technology is perfect. While we are constantly working to improve ChatGPT’s accuracy and adaptability by fine-tuning it specifically on crypto data, it is unrealistic to expect it to be completely flawless. Crypto traders should still exercise caution and double-check the information provided by AI before making any critical decisions.”
That leads us to several questions about ChatGPT’s nature and its potential: what is currently missing for it to be the ultimate crypto trading tool? What limitations specific to crypto trading does ChatGPT have? Will it be able to replace trading bot providers and the multiple crypto trading tools that traders use right now? Let’s find out!
Why ChatGPT is Not The Perfect Solution (Yet)
Perhaps one of the most notable limitations is that ChatGPT’s training data extends only up until September 2021, which means it may not have the most up-to-date information on market developments or recent technological advancements.
This drawback might be gone in the future in case the developers from OpenAI decide to lift this limit. However, there is more than just a knowledge cutoff.
Marius Grigoras believes that ChatGPT’s lack of human perception limits the AI’s potential to act as a financial assistant.
In his opinion, “One of the primary concerns is that ChatGPT, as an AI language model, lacks the ability to inherently understand the nuances of the crypto market or the psychology of human traders. It is also unable to anticipate market events or news that could affect trading behavior.
Additionally, trading-specific features, such as risk management, order execution, and real-time data processing, might not be as sophisticated as those offered by specialized trading platforms.”
Sandra Grabowiec thinks that even though ChatGPT can potentially create automated bots and trading strategies for crypto traders, they, in fact, are useless in case a trader lacks in-depth knowledge of the subject.
She believes that “ChatGPT can teach us a lot about programming and trading. With that, it lowers the entry barrier for future crypto traders and helps them to get started. But we need to be more knowledgeable about, e.g., PineScript or indicators to assess the code’s quality. ChatGPT is in its infancy, makes a lot of mistakes, and needs to be more accurate.
Another critical issue is that people who are complete novices may need help with writing what strategy they want to create in the prompt. With vague descriptions, the strategy will likely be inefficient. With too few specifications, the generated code may behave in an undesired way.”
Final thoughts
ChatGPT represents a significant milestone in the field of natural language processing and artificial intelligence. Its ability to understand and generate human-like responses has the potential to revolutionize a wide range of industries, from customer service to content creation to education. However, like any tool, ChatGPT has its limitations, such as its inability to fully understand context and nuances, make decisions on behalf of humans, and generate completely original ideas.
Nevertheless, with ongoing development and improvements, it will be exciting to see how ChatGPT and other AI models will evolve to better serve the needs of various industries and individuals. As with any technology, it is important to view ChatGPT as a complementary tool that can help enhance human capabilities, rather than a replacement for human intelligence and expertise.
As technology continues to advance, it will be exciting to see how ChatGPT and other AI models will evolve to better serve the needs of the crypto trading community.