Tag: Machine Learning

Coinbase Rolls Out AI-Driven ERC-20 Scam Token Detection System

by Blockchain News

Coinbase’s Chief Legal Officer, Paul Grewal, recently shed light on how their Engineering team is harnessing Artificial Intelligence (AI) to root out ERC-20 scam tokens.This innovation was disclosed on October 6, 2023, by Yifan Xu, Indra Rustandi, Yao Ma, and Vijay Dialani from the engineering team at Coinbase. The innovative ERC-20 Scam Token Detection System is a blend of smart contract auditing and machine learning prediction aimed at identifying both known and emergent scam types, marking a significant leap towards ensuring a safer crypto space.

The burgeoning realm of cryptocurrency is not without its share of scams, especially surrounding new and unverified tokens. Fraudsters employ a variety of devious tactics, ranging from Honeypot scams, which are deceptive traps to ensnare investors, to Internal Fees scams involving hidden or unusually high transaction fees. The evolving nature of these scams presents a continuous challenge, with new scam types emerging daily, posing a significant threat to both investors and the broader crypto ecosystem.

To combat these challenges, Coinbase has developed the Scam Token Detection System which employs a two-pronged strategy: 

Smart contract auditing is a proactive measure to identify and filter out known scam types. By meticulously examining the integrity of tokens, this step helps to mitigate the risk of fraud by excluding tokens associated with known malicious activities, capturing and cataloging them for future reference.

On the flip side, the system employs a machine learning framework to detect unknown scam types by identifying abnormal activity patterns. For instance, unusual patterns in time-series transactions among a concentrated group of accounts could be indicative of unknown scam types. This abnormality detection mechanism spots these irregularities, safeguarding against potential unidentified scams.

The Scam Token Detection System isn’t just a technological safeguard; it translates into tangible benefits for users. The establishment of a whitelist of trusted tokens is crucial for launching Coinbase’s asset recovery service for unsupported ERC-20 tokens. This feature, coupled with the ability to hide scam/spam tokens within the Coinbase Wallet, significantly enhances the platform’s capacity to filter out spam tokens, providing a cleaner, safer, and more user-friendly experience.

Image source: Shutterstock

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Binance Integrates AI Chatbot ChatGPT into Its Education Platform

by Blockchain News

In late November 2022, the artificial intelligence (AI) chatbot ChatGPT made headlines worldwide, sparking much opposition to the technology. However, despite the initial pushback, the technology has continued to gain traction and see growing implementations. The latest example of this is the integration of ChatGPT into Binance Academy, the education platform of cryptocurrency exchange and blockchain developer Binance.

On April 24, Binance announced the launch of its new AI-driven tool, the Binance Sensei, which uses machine learning to source answers from Binance Academy’s education platform to help users answer questions related to Web3. The tool is essentially an “AI-powered mentor” that users prompt with a specific question or keywords. In response, the Sensei provides a “concise, approximately 150-word summary” for each user.

Although the news has been received positively by many in the Binance community, some have questioned the idea of “allowing a robot to be our teacher.” The integration of AI in education has sparked concerns about the potential misuse of the technology.

Binance Sensei is not the first AI-based learning tool to be implemented in the cryptocurrency space. Industry giants such as Microsoft, Google, and Alibaba have all announced their own versions of ChatGPT. The technology is also finding a role in bringing more efficiency to the memecoin community.

However, the adoption of AI in various industries has also led to an increase in concern over the technology’s capabilities if left unchecked. Italy was one of the early adopters of a brief ban on the usage of the technology, while regulators across the European Union have decided to probe the AI-algorithms of BigTech companies.

Industry insiders speculate that there may be an upcoming regulatory crackdown on AI as it becomes more pervasive. In China, for instance, authorities are set to enforce mandatory security reviews for all AI services in the country.

In conclusion, the integration of AI chatbot ChatGPT into Binance Academy is another example of the increasing use of AI in various industries, including cryptocurrency. While the technology may provide many benefits, it is important to consider its potential consequences and regulate its use to prevent misuse.

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OKX Launches AI Integration for Crypto Market Volatility

by Blockchain News

Artificial intelligence (AI) is becoming increasingly prevalent in the crypto industry, with OKX leading the way in integrating the technology to enhance user experience. On March 31, the cryptocurrency exchange and Web3 technology company announced a new integration from EndoTech.io that utilizes AI algorithms to capture crypto market volatility.

The algorithms used in the integration incorporate machine learning and other advanced techniques to conduct real-time analyses of data and trading opportunities. According to Dmitry Gooshchin, chief operating officer of EndoTech.io, understanding market volatility is essential for successful trading in the crypto space.

OKX’s adoption of AI in the crypto industry is not new. The company recently posted an AI-generated poem from ChatGPT-4 about its wallet on March 30. The poem was an example of how the AI technology can be used to enhance user experience and engagement.

The integration with EndoTech.io is just one example of how AI is finding various use cases in the crypto industry. It is not only used to identify real-time market volatility but also for tracking blockchain transactions, deploying autonomous economic agents for trading, and more.

In everyday life, AI is now used for personal assistant-like tasks, social media, and customer service needs, among other use cases. However, not everyone is convinced of the benefits of AI technology. Recently, a letter signed by 2,600 researchers and leaders in fintech called for a pause in AI development. The letter highlighted the concern that “human-competitive intelligence can pose profound risks to society and humanity,” among other issues.

While opinions on the impact of AI in the crypto industry may be mixed, OKX continues to push forward with its AI integration strategy. This new platform update comes only a few days after the company announced its intention to expand its services to Australia while shutting down its former operations in Canada.

As AI technology continues to evolve, it will be interesting to see how it shapes the future of the crypto industry and society as a whole. While there may be concerns about its impact, the potential benefits of AI cannot be ignored.

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Defying the bear market, this automated strategy is up 15% so far in 2022

by Cointelegraph

Let’s be blunt: Being in a bear market sucks profoundly as a crypto trader. Most strategies that work when everything is green lead to losses. Growing the value of a portfolio takes twice as much work for half as much progress. The uncertainty over how long the market will remain down is exhausting. During these times, making use of every available tool that can enhance traders’ decision-making is key to success.

One such tool is the VORTECS™ Score, an algorithmic indicator available to the subscribers of Cointelegraph Markets Pro that is designed to use historical data on crypto assets’ performance to determine whether their current conditions are bullish, bearish or neutral.

The Score can be creatively used in an infinite number of ways, but one hypothetical strategy based on detecting the strongest historical analogies massively outperformed both Bitcoin (BTC), which has lost some 25% of its value during the first month of 2022, and the aggregate altcoin market, whose losses are comparable. This strategy, called “Buy 90/Sell 70,” yielded a 15% gain between Jan. 1 and Jan. 27.

What does Buy 90/Sell 70 mean?

The most important thing about VORTECS™ Score-based testing strategies is that they are not meant to be directly replicated by human traders. Rather, they serve as a tool to assess the overall efficiency of the model over a period of time.

Trades that inform this strategy occur on a server rather than an actual exchange. There can be dozens of them per day, and the testing portfolio gets rebalanced according to a formula after each trade. Still, the results that these tests generate can provide a compelling picture of the algorithm’s performance.

The way the indicator works is as follows: The higher the VORTECS™ Score, the more confident the model is that the observed conditions are bullish for a coin, based on historical precedent. Conventionally, a score of 80 is interpreted as high confidence in the outlook’s bullishness. Such scores are observed frequently, with around 50 instances in an average week.

Scores of 90 and above are much rarer; normally, there are just a few instances every week. What they indicate is that in the past, the observed setup of trading conditions reliably showed up before dramatic price spikes. The Buy 90/Sell 70 strategy means buying every asset whose VORTECS™ Score hits 90 and selling it once it drops below 70. If the testing algorithm already holds another asset at the time of the next 90 hit, the portfolio is rebalanced so that it holds all the qualifying assets in equal proportions.

How it has gone down in 2022

Throughout January 2022, a total of 18 crypto assets have achieved a VORTECS™ Score of 90. One of them was Voyager Token (VGX), pictured below, which hit the threshold on Jan. 25 against a price of $1.76 (red circle in the chart). Before the asset’s score went below 70, the price rose to $1.87. In the following hours, it went further up to $2.07, but that additional gain would not be accounted for in the 90/70 results.

VORTECS™ Score (green/gray) vs. VGX price, Jan. 20–27. Source: Cointelegraph Markets Pro.

The assets that hit the VORTECS™ Score of 90 tend to be more resilient than most other coins to the negative trends that exist in the wider market. Thanks to their extremely healthy individual conditions, these tokens delivered an average 5% gain within seven days of hitting the ultra-high score in 2021.

Of course, a strong VORTECS™ Score performance is never a guarantee of future price movement. All strategies based on buying at the score of 80, for example, yielded negative returns in the first weeks of 2022. However, the success of the 90/70 strategy shows that historical precedent can be extremely informative even amid a massive correction in the crypto market.

Cointelegraph is a publisher of financial information, not an investment adviser. We do not provide personalized or individualized investment advice. Cryptocurrencies are volatile investments and carry significant risk including the risk of permanent and total loss. Past performance is not indicative of future results. Figures and charts are correct at the time of writing or as otherwise specified. Live-tested strategies are not recommendations. Consult your financial adviser before making financial decisions.

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IoTeX ‘MachineFi’ rebrand backs 200%+ rally to a new all-time high

by Cointelegraph

In the past 30 years the growth of the internet and digital technology has transformed the way the world operates and today artificial intelligence and machine learning continue to shift the balance of power away from physical labor and more toward a future filled with automation and smart technology. 

IoTeX (IOTX), a blockchain-based project focused on Internet of Things (IoT) devices and the future of machine learning in the workforce, aims to design an open ecosystem that facilitates interaction between people and machines and over the past month the projects IOTX token has rallied more than 200%.

Data from Cointelegraph Markets Pro and TradingView shows that since hitting a low of $0.055 on Oct. 27, the price of IOTX has surged 377% to a new record high at $0.263 on Nov. 13 as its 24-hour trading volume spiked to a record $3.93 billion.

IOTX/USDT 4-hour chart. Source: TradingView

Three reasons for the breakout price action for IOTX include the rebranding of the project to focus on the rise of MachineFi, the addition of support from multiple protocols and exchanges and the launch of nonfungible tokens (NFT) and decentralized finance (DeFi) projects on the IoTeX mainnet.

The rise of MachineFi

The biggest boost for the IoTeX ecosystem came early in November when the project announced that it was rebranding to focus on “The rise of MachineFi” as a way to further integrate machines, the Metaverse and the traditional workforce.

MachineFi follows the emergence of DeFi and more recently GameFi, and is intended to deal with the confluence of smart devices, machines and finance through the integration of blockchain technology.

As the number of smart devices in use continues to rise, IoTeX aims to ensure security and trust between users and their devices, as well as create a simple interface where all devices can connect and be managed.

Ecosystem expansion and exchange listings

Another reason for the growing strength of IoTeX is the recent addition of new ecosystem partners, as well as listing on several cryptocurrency exchanges which helped to increase the token’s exposure to crypto traders.

This year IOTX listed on ABRA, Crypto.com, LBank and Coinbase, as well as being added to Pokket, a passive yield-generating platform.

The project has also been busy establishing partnerships with other projects in the cryptocurrency sector, including integrations with Chainlink, the mobility as a service protocol MobiFi, Health Blocks, the Ethereum Push Notification Service, Travala and the blockchain payments provider NOWPayments.

Related: To work for everyone, the Metaverse must be decentralized

DeFi and NFTs launch on the network

A third factor helping to drive the price of IOTX higher has been the expansion of the IoTeX ecosystem and the addition of multiple NFT and DeFi projects to the protocol.

DeFi is the largest sector of growth in the IoTeX ecosystem and some of the recent project launcehs include WOWSwap, the first leverage decentralized exchange (DEX) on IoTeX, Mimo DEX, and the cross-chain compatible Parrot Protocol, NAOS Finance and Firebird Finance.

On the NFT front, IOTX has benefited from the launch of Sota Finance, the first NFT marketplace on the IoTeX network, as well as the launch of multiple NFT projects including StarCrazy and PlaceWar.

VORTECS™ data from Cointelegraph Markets Pro began to detect a bullish outlook for IOTX on Oct. 20, prior to the recent price rise.

The VORTECS™ Score, exclusive to Cointelegraph, is an algorithmic comparison of historical and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.

VORTECS™ Score (green) vs. IOTX price. Source: Cointelegraph Markets Pro

As seen in the chart above, the VORTECS™ Score for IOTX spiked into the green on Oct. 20 and reached a high of 70, around seven days before the price began to increase by 377% over the next three weeks.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.