We're used to interacting with popular digital assistants, such as voice assistants from Apple, Google and Amazon. But how applicable is this in financial settlements with chatbots on social networks? Are users ready to share their bank card details with an unfamiliar robot?
Three ways chatbots can revolutionise the cryptocurrency market
Have you ever used chat forms on websites or voice assistants in applications? Then you are pretty familiar with the chatbot’s nature. You may think that it is a novel feature, especially in cryptocurrency, but chatbots have been popular among traders since 2017.
Trading cryptocurrency is a complex process that often includes rapid market changes. As a trader, you won’t succeed without having accurate, up-to-date market information you can act on quickly. This is where chatbots can come in handy and make cryptocurrency trading much easier and efficient. Here’s how.
How chatbots are changing the cryptocurrency field
The cryptocurrency market is expected to grow by 30% by 2026. If you haven’t already, this is the perfect time to dive into the world of crypto trading, and chatbots can help you to ease into this chaotic industry.
Here’s how chatbots can enhance your cryptocurrency trading experience.
Save time and money with a virtual assistant bot
Chatbots can act as your personal virtual assistant for making cryptocurrency transactions easier.
Simpler and more convenient transactions
When purchasing cryptocurrencies such as bitcoin, you’ll first have to transfer the funds from your bank to a digital currency exchange, like Coinbase or Binance, which will exchange your national currency for crypto and add it to your digital wallet.
It can be a time-consuming process, as your bank might need to verify your transfer, and the exchange will need to verify your identity. A virtual assistant bot can help reduce the number of steps for each transaction. A chatbot can also limit contact time with support staff who are required to handle the verification process.
Virtual assistant bots often use a three-tier verification process, where your bank account, national ID and unique identification (fingerprint, facial recognition, or PIN) are verified on the first transaction and stored in your crypto wallet app. Every time you make a new transaction request, the bot can access that data and verify your ID in real time.
As a result, you don’t need to enter codes and account information for each transaction and wait for transactions to get verified.
Managing your money wisely
For most people, cryptocurrency is all about bitcoin. But once you enter the world of crypto trading, you’ll realise that bitcoin is only the peak of the massive cryptocurrency mountain. Successful crypto traders need to invest and manage several different cryptocurrencies, such as bitcoin, ether, cardano, XRP and many more.
Managing such a wide range of digital currencies in a volatile market can be complex, and it might make your head spin during those peak trading weeks. This is where chatbots can help you seamlessly manage your digital currencies and offer you a smoother trading experience.
Chatbots are powerful AI solutions that can monitor market patterns and trading habits to give you accurate advice on when to buy, hold, or sell your crypto.
You don’t need to base your trading decision on assumptions or spend long hours analysing each crypto market manually. The statistically driven advice from chatbots can help you make better trading decisions to manage your money wisely in such an unstable cryptocurrency market.
Advantages and disadvantages of using chatbots
Using chatbots as your virtual assistant for crypto trading is an excellent idea for saving you time and money, but there are some downsides to it. Before you make that decision, have a look at the pros and cons of having chatbots as your virtual trading assistant.
Makes faster and more accurate trading decisions
Sudden variations in the market will not be properly acted on due to the stereotyped actions of the bot
24/7 monitoring of the crypto market
Need for constant fact-checking of the information and actions of the chatbot
Instantly notifies you of any important trading info
Some chatbots are expensive
Removing unnecessary steps in trading
The ability to help traders avoid unnecessary actions also adds to the popularity of chatbots. Here are some examples of how bots can help in day-to-day crypto trading.
Save the cost
Chatbots can act as your virtual broker. You don’t need to pay an intermediary to help you with your crypto transactions. Chatbots are driven by innovative AI algorithms that can help you make the best decisions in the market. They can also be trained to perform your transactions the way you want.
Reduce transaction time
Chatbots can help you reduce transaction time during peak trading hours, allowing you to use the opportunities of the volatile crypto market.
Let’s say that you’re waiting for a bitcoin price drop below a certain level to buy the currency. As the crypto market is very unstable, whenever a price drops or hikes, it doesn’t stay there for a long time.
So, instead of constantly monitoring the Bitcoin market, you can set certain parameters for your chatbots to conduct the transaction in real-time on your behalf. This means that when the price of bitcoin drops below a certain level, the chatbot will instantly perform the transaction for you.
All you have to do is set parameters such as what price you’re looking to pay, and how many bitcoins you’re willing to buy at that price.
As a trader, you must always stay on top of occurrences in the industry. Chatbots can effectively assist you in this matter.
Getting news on time
Cryptocurrency trading is not just about being aware of coin prices, but also about staying informed about the latest news in the industry. Chatbots can give you regular updates on important events and announcements. You can get daily newsletters with the biggest price changes, crypto deals, and much more.
Getting only important information
Cryptocurrency is one of the hottest trends in the market right now. That is why there's a lot of daily news related to crypto. However, not all information is relevant to you as a trader. You’ll need to stay updated on the important news that can affect your specific position in the crypto market.
For example, the recent news about China banning crypto mining caused massive price drops for bitcoin and ethereum. As a trader, if you knew this instantly, you could’ve sold your bitcoins for a higher price as the market started to decline. However, if your portfolio does not include these coins, this information is not vital to you.
Chatbots can keep you updated on the latest, most important news that can potentially affect your trading decisions. Instead of scrolling through endless news portals, chatbots will deliver the most important news that is relevant to you as a cryptocurrency trader.
The future of chatbots
Cryptocurrency has become a lucrative industry for new traders. As more and more novice traders dive into the crypto world, chatbots will continue to become more popular thanks to their efficiency and accuracy in helping traders make the best financial decisions in such a volatile market.
Developers are constantly working on new chatbots, trying to make them more powerful and functional for crypto trading.