ChatGPT believes Bitcoin will hit $100K the next year

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Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

The U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler said the regulatory body was reviewing multiple spot Bitcoin [BTC] exchange-traded fund (ETF) applications. Gensler made the confirmation, while speaking to Bloomberg’s Kailey Leinz.

SEC Chair, however, remained tight-lipped on the Grayscale Investments court case.

In August, the court ruled that the regulator’s decision to reject Grayscale’s spot Bitcoin ETF application was “arbitrary and capricious”. This month, it emerged the regulator had decided not to contest the judgment.

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Read Bitcoin’s [BTC] Price Prediction 2023-24

Bitcoin ETF applications have been generating a lot of buzz for the past few months.

On 16 October, we witnessed BTC rallying towards the $30K-price mark. The trigger for this rally was an erroneous tweet by a leading crypto publication about the SEC approving BlackRock’s spot BTC ETF application.

Even though the clarification led to the king coin faltering on the charts later, it hasn’t plunged below the $28K-mark since then. It was exchanging hands at $29,600 at press time.

Bitcoin earlier soared as high as $31.7K within a day of Ripple [XRP] securing a partial victory in its legal battle with the SEC on 13 July. But it failed to sustain the price rally.

The U.S. District Court of the Southern District of New York ruled in its judgement that the sale of Ripple’s XRP tokens on crypto exchanges and though programmatic sales did not constitute investment contracts; hence, it is not a security in this case.

But the court also ruled that the institutional sale of XRP tokens violated federal securities laws.

The crypto industry lapped up the judgement instantly, generating a price rally across tokens. But no coin could sustain the price rally for long.

We should also note that in June, the SEC approved the first leveraged futures Bitcoin ETF, namely the Volatility Shares 2x Bitcoin Strategy ETF (BITX). In August, London-based Jacobi Asset Management announced the launch of its BTC ETF in Europe.

Observers look at these developments as institutional approval of cryptocurrency.

For a long time, the crypto’s price hovered between $200 and $1,000 on the price charts. However, in late 2017, BTC’s value exploded, hitting an all-time high (ATH) of nearly $20,000 in December.

Though market participation grew, the price rally was short-lived. By early 2018, BTC’s price had fallen back down to around $3K. The cryptocurrency market as a whole recorded a period of decline, with many traders losing significant amounts of money.

Nonetheless, Bitcoin made a remarkable recovery, surpassing its previous ATH in late 2020 and reaching an ATH of over $68K in November 2021. However, the 2022 trading year ushered in a new era of bearishness, one exacerbated by the collapse of Terra/LUNA and FTX.

In fact, in November 2022, Bitcoin was trading at a two-year low of $15K.

While the crypto market may be unpredictable and volatile, traders and investors can still make informed decisions by staying up-to-date on market news, following expert analysis, and using intelligent trading strategies, such as those offered by ChatGPT.

In November 2022, the AI model ChatGPT was launched to the public. In fact, it quickly gained significant attention, too. With its broad range of capabilities and versatility, the question arises whether there are other ways that ChatGPT can lend its expertise, such as assisting BTC traders in formulating and applying improved trading strategies.

When asked if it could do this, ChatGPT had this to say –

Source: ChatGPT

Due to its nature as an AI tool, there are limitations to what ChatGPT can do regarding price predictions and price future movements. However, there are ways to leverage the tool’s capabilities to formulate better trading strategies as a BTC trader.

One way to utilize the AI tool to make better trading strategies is by deploying it toward fundamental analysis. ChatGPT is capable of extracting insights from financial news articles, social media posts, and other unstructured data sources.

We can use this information in conjunction with other datasets to make informed trading strategies.

Another way to use ChatGPT as a Bitcoin trader is to use it for sentiment analysis. ChatGPT can be fine-tuned to perform sentiment analysis on information from news articles, on-chain data providers, social media discussions, and other sources.

This can be used to identify whether the BTC market lingers under positive sentiment or is plagued by negative sentiment.

Furthermore, BTC traders can use ChatGPT for technical analysis. Traders can ask ChatGPT to code any technical indicator or trading bot for any trading platform.

For instance, I asked ChatGPT to give me an example of a trading bot that I can use to track BTC’s price volatility in pine script–TradingView’s programming language is useful for back testing trading strategies. The AI responded,

Source: ChatGPT

To use ChatGPT for technical analysis, traders need to be familiar with the language to know when to make the necessary modifications for the code to work properly. The prompt text is crucial in how ChatGPT understands the problem and provides the anticipated solution.

For a well-rounded piece, I spoke to Brian Quinlivan, the Director of Marketing at Santiment, who also happens to have been involved in Bitcoin trading for a few years.

Brian Quinlivan has an MBA degree in finance from Chapman University, Brian has over 10 years of marketing, financial, and data analytics experience. He enjoys creating financial models to improve modern-day investing strategies and study the intricacies of market variations.

Q: In what ways do you think ChatGPT can revolutionize cryptocurrency trading?

Yeah, I think that there’s going to be a lot of use for it, certainly for trading strategies. One thing to be concerned about is the uniform opinions that may result from an AI tech giving a kind of overarching strategy, whether it be hodling or fundamental strategy.

Individuals can easily manipulate ChatGPT to (mis)inform the audience. We are already seeing slight effects of it.

I think it can be both helpful and dangerous at the same time and cause a lot of people to be educated much more quickly, but also be pulled in directions that can influence the way crypto goes and create a lot of self-fulfilling prophecies.

Q: How do you think a BTC trader/investor can leverage the AI tool to make better investment decisions?

I think, in short, I think scripts would be used in AI a lot more because of the fact that all of the data could be digested at the same time and given a very simple answer whether to buy or sell. This, I believe, can influence the markets tremendously moving forward.

As mentioned above, ChatGPT cannot make future predictions.

To get it to answer my question, I decided to jailbreak it by using the Do Anything Now (DAN) method. It said BTC might cross the $30K-mark within the coming days or weeks.

Source: ChatGPT

I further quizzed the AI technology on Bitcoin’s price in 2024. ChatGPT predicted BTC will rise to $100K or more in 2024—a completely speculative assertion.

Source: ChatGPT

In early June, the SEC began its crackdown on Binance [BNB] and Coinbase [COIN], leading to a bearish market. In such a situation, BTC has shown its resilience so far.

Source: BTC/USD, TradingView

At press time, BTC was trading at $29,600. Investors are hoping the token will at least reach the $30K-mark again.

However, both BTC’s Relative Strength Index (RSI) and Money Flow Index (MFI) rested below the neutral 50-level. In conclusion, BTC’s on-chart metrics don’t give us a positive sign.

Is your portfolio green? Check out the BTC Profit Calculator

ChatGPT predicts that BTC can rise to $100K the next year. We will have to see if the coin can break all-time highs during 2023-24 due to its increased adoption (by companies and institutions) and as BTC’s appeal as a hedge against inflation grows.

Its on-chart metrics don’t encourage us— at least in the short term. However, it is trite to note that increased regulation and government scrutiny could spread FUD, causing its price to dip.

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