The convergence of AI and DeFi could be a tipping point, with trading and portfolio management becoming the main use cases.
Over the past few years, the crypto industry has faced serious problems, such as broken exchanges, regulation, the collapse of projects and the rejection of stable coins.
These problems have led to an atmosphere of uncertainty and skepticism in the industry.
However, the obstacles that had to be faced opened the way for new participants, and with them innovative solutions that continue to stimulate the development of decentralized finance (DeFi).
At the forefront of these efforts is the growing drive to integrate artificial intelligence (AI) into financial ecosystems, which represents the next step for cryptocurrencies.
This central focus is on and is aimed at increasing sustainability, reducing risks and creating a sustainable and reliable foundation for the future of the industry.
One of the options for using artificial intelligence in DeFi is related to trading and portfolio management.
The tools allow us to improve forecasting capabilities by introducing more advanced and accurate models for predicting the movement of prices for cryptocurrencies.
AI-based trading tools can analyze huge amounts of price data, identify graphical patterns, and take bullish or bearish positions using technical analysis indicators.
Such tools are not only more accurate and more powerful than human ones, but also completely unaffected by the psychological aspect, allowing you to enter and exit positions in accordance with the strategy.
And it can make transactions based on pre-set conditions and learned patterns, which allows trading around the clock and with high efficiency. This could open up more opportunities for traders in volatile cryptocurrency markets.
Improving DeFi with AI
One example of a DeFi trading platform with artificial intelligence support is Athena GPT, a product of NFA Labs (NFAi).
Athena is part of a broader DeFi ecosystem known as Not Financial Advice (NFA), which will also include the Canis lending protocol and the Hecate insurance protocol.
The trading platform has an intuitive dashboard and powerful artificial intelligence tools, including the Athena portfolio management service, which can work with more than 35 cryptocurrency pairs.
It can analyze and predict their prices in real time and automatically open long and short positions.
Athena also uses AI training capabilities to take futures trading positions and return profits to the ecosystem, increasing its speculative value.
In addition, the ability to assess market sentiment on the basis of major social media platforms such as Twitter and Reddit, working around the clock, gives investors a constant opportunity to make profitable trades in both bullish and bearish markets.
A distinctive feature of NFA Labs in this area is its focus on identifying the main problems of cryptocurrencies and creating their solutions, expanding the boundaries of what is possible with the help of artificial intelligence and creating a thoughtful economic structure that will resonate with investors who have simply accepted some realities that the project seeks to refute.
NEO Labs demonstrates the capabilities of artificial intelligence and how this technology can make DeFi more attractive to investors of all types by reducing dependence on centralized structures exposed to a variety of other risks.
The combination of DeFi and artificial intelligence can change the financial world, democratizing access to financial instruments and opportunities previously available only to a limited number of traders.