Bitcoin has undergone several transformations in the past, from halvings every four years to updates that boosted its value. Now, after the fourth halving and the Taproot upgrade, Bitcoin is supposed to show bullish signs over a more extended period, keeping investors engaged.
However, many other factors contribute to Bitcoin’s path. First, since the halving cut the mining reward to half again, miners will be affected, and the network is at risk of being compromised due to fewer miners maintaining its safety. At the same time, the high competition can readjust current Bitcoin price predictions since cryptocurrencies like Ethereum, Tether, and BNB are getting more popular.
Nevertheless, Bitcoin can adapt to new trends that shape the world, such as artificial intelligence, one of the most rapid-emerging market currents.
Miners might generate more income through AI
As previously mentioned, miners will be heavily affected by the halving in 2024. The reward diminished from 6.25 BTC to 3.125 BTC, meaning users need to update their hardware, electricity power and strategies to leverage the same income as before the fourth halving.
Still, Bitcoin mining was already pretty difficult to maintain, as the difficulty rose substantially, making it more difficult for miners to find the correct hash for the block. The incredible ASIC costs and operational challenges might push miners toward AI usage in order to boost their income. It seems like mining companies are already leveraging AI to optimize energy costs and establish mining efficiency, so individual miners might also approach these strategies, at least to buy better-priced hardware.
Therefore, AI might boost the Bitcoin price since it will be easier to mine, the network will maintain its safety, and the cryptocurrency will gain more value. Considering that AI developments will boom in the future, so will the Bitcoin price.
The approval of BTC ETFs is already driving prices upwards
BTC exchange-traded funds have been trending in 2023, and they’re continuing to make waves even this year, especially since the SEC is starting to approve these projects. Since then, ETFs have been increasingly in demand as they’re a regulation option for trading and investing that institutions and individual buyers can safely turn to. Since ETFs are tied to Bitcoin’s value, the cryptocurrency’s price has gone through the roof.
The reason why so many people are appalled by ETFs is because they provide significant diversification potential, which is one of the most important factors in an investment. At the same time, ETFs are considered less sensitive to market changes, which helps investors better mitigate bearish trends in the market. Hence, the Bitcoin price is expected to surge as more ETF projects become popular, especially since many are backed by artificial intelligence.
The Lighting Network might use AI to establish better network services
Artificial Intelligence has the potential to contribute to the Bitcoin network by being leveraged in the Lighting Network, a Layer-2 solution on the blockchain. The technology was introduced to streamline transactions with lower fees and link various payment channels together to facilitate fund transfers. Therefore, the Lighting Network can ensure scalability, speed and low energy requirements for the network.
Still, the Lighting Network is currently facing challenges of costs and counterparty risks, which can change with AI integration. At the same time, AI models can benefit from the unparalleled speed of the Lighting Network, which can create a fair pay-per-use model. Ideally, this synergy can help users earn more income by providing their hardware in exchange for AI computations.
AI can forever change Bitcoin trading
AI trading models are capable of offering valuable insight into trends, from Bitcoin’s price history to current events that influence the investor behavior index. Therefore, AI models can make the impossible possible and help investors predict the Bitcoin price with incredible accuracy. At the same time, using machine learning systems can contribute to better decision-making as they help improve investors’ strategies for the short and long term.
Indeed, AI in trading models still needs time to adapt to technology and the market, but its most significant issues stand in ethical questions. Experts fear AI will be used to manipulate the market or trigger privacy breaches, which will affect the networks’ integrity. Although exploiting market conditions should be used positively, it can also turn the market to the dark side.
AI chatbots for customer support
There isn’t enough customer support in the crypto area, mainly because decentralized ecosystems are not maintained by a single authority point, which allows users worldwide to secure blockchains. However, crypto businesses, such as exchanges or trading websites, have increased in popularity and are in demand, so introducing customer support would be helpful for beginner investors or any kind of crypto user.
Regardless of decentralization and censorship-free ecosystems, people still need guidance. However, help must be unbiased and based only on facts, which is what AI chatbots could help within the crypto market. Although employing AI-powered chatbots can be difficult at first, it’s what comes next in crypto.
However, AI implementation isn’t that easy
AI adoption is indeed on the rise, but introducing it in the crypto market might not be straightforward, especially when considering regulation. Cryptocurrencies are barely recognized globally as reliable exchange methods, even though Bitcoin is already legal tender in El Salvador. At the same time, artificial intelligence must cross legal barriers before being approved by governments for use by regular customers.
At the same time, AI is known for its security vulnerabilities and moral challenges that have made people and companies doubt its efficiency. Hence, AI developers must be wary of their contribution to safe and compliant ecosystems because falling into the wrong hands can only trigger adverse effects on the crypto market.
What do you think about AI and Bitcoin?
Bitcoin, the first and most popular cryptocurrency on the market, has been lately experimenting with artificial intelligence, one of the most emerging technologies of the past years. AI mining, market analysis and customer support might become the future of the cryptocurrency, driving its prices to the moon.