Artificial Intelligence (AI) tools like ChatGPT, developed by OpenAI, offer invaluable assistance to investors seeking rapid collection and organization of complex information to aid in due diligence and decision-making. On September 27, Finbold consulted ChatGPT-4 to identify three cryptocurrencies suitable for long-term investment. OpenAI’s latest software version recommended Bitcoin (BTC), Ethereum (ETH), and Cardano (ADA).
These top three choices align with CoinMarketCap’s ranking, as they are among the seven largest cryptocurrencies by market capitalization. This suggests that data-driven analysis played a role in their selection.
ChatGPT emphasized the volatile and speculative nature of the cryptocurrency market, emphasizing that while some investors adopt a “buy and hold” strategy, there are no guarantees of success. Conducting thorough research and considering risk tolerance is crucial.
Bitcoin (BTC), the foremost cryptocurrency, was ChatGPT’s first pick. It highlighted Bitcoin’s “fixed supply” and the robust network of miners and nodes, which provide both security and stability. However, it’s worth noting that Bitcoin’s supply is not truly fixed but capped by a programmed emission expected to continue for approximately the next 137 years.
Ethereum (ETH), the second-largest cryptocurrency, was ChatGPT’s second choice. It underlined Ethereum’s role as a foundation for decentralized applications (DApps) and smart contracts, making it an appealing long-term investment. However, it mentioned the move to Proof of Stake (PoS) as an investment opportunity, although this network update occurred in September 2022.
Surprisingly, ChatGPT skipped over Tether USD (USDT), BNB Chain (BNB), XRP Ledger (XRP), and Circle USD (USDC), which are larger in terms of market cap, and instead selected Cardano (ADA) as its third choice. Cardano is known for its focus on scalability, sustainability, and interoperability. The AI praised its strong academic and research-driven approach, aiming to provide a secure and scalable platform for smart contracts and DApps. However, it noted that Cardano’s DApp and DeFi ecosystem is still in its early, experimental stages.
In conclusion, ChatGPT’s cryptocurrency recommendations, while well-reasoned, should be approached with caution, considering the rapidly evolving nature of the crypto market and the need for ongoing research and risk assessment.