A friend shared the above video with me, about how to use AI to trade crypto and make a profit. The video outlines how to use a trading platform in conjunction with ChatGPT.

Here's a few problems I see with the get rich quick with AI fad I see sweeping the internet.

Trading Platforms

First off, using any of these algo trading platforms, whether they use ChatGPT or not. (see video timestamp), it is easy for the platform operators to game the game. They know all of the trades people have placed and so can trade with or against them. Which is illegal, since that's insider trading. But as we saw with GameStop, we know these platforms find crafty ways to do this until they're caught.

Having leader boards of the most successful algos, will over time, make those algos less profitable as more and more people use the same strategy.

Open AI + Your Idea = Everybody's Idea

ChatGPT cannot innovate on it's own. It requires a dataset, and then a reinforced training model, meaning, if you ask ChartGPT to write you an algo, there's a likelihood some one else is asking for the same thing, meaning again, the more people using it the less profitable it is.

You might argue that you have a very unique idea and whether you write it yourself or give it over to ChatGPT to write it for you makes little difference, other than the time saved by outsourcing the task to AI automation.

However, every idea you submit to these AI platforms, you are basically giving it away, open sourcing it, adding to the pool of the reinforced training model, meaning, AI could end up offering your once unique solution to others. Ergo, you lose your competitive advantage again.

So perhaps the solution is to:

• Not hand the task over to AI at all if you want to retain a competitive advantage
• Break the idea up into separate discrete chunks that you then manually stitch together, and hope that the AI doesn't join the dots
• Set up your own independent AI, but then you are limited by your own computing resources, dataset and training model
• Perhaps you could have your private AI scrape other AIs to build your own training model

The last point is the major flaw with open public AIs; the escalating arms race of AIs cannibalising each other, with innovation coming to a standstill. But open public AIs are also a powerful resource because you have millions of people willingly submitting data to them and training it.

Those with the money and the power will realise this, establish their private proprietary closed AIs that will plunder the public data and keep their advantages with their own unique data and training model because they have not shared it publicly.

Prompt Monkey See Prompt Monkey Do

The majority of people using these AI platforms are incapable to figuring out the ideas or tasks that they request of them. AI "art" is a case point example. Now EVERYBODY is a "master" artist.

Given this video was uploaded to a YouTube channel with 1.39 million subscribers and at time of writing, 43,000 people have already seen the video, you can be guaranteed that the majority are just going to copy and not innovate.

Following the crowd / trend / dumb money in trading would appear to rarely end up profitable.

So perhaps in the short term, yes, you will make some money, but in the long term, I surmise that using trading platforms and open AI will work against you.

If you have have concrete data to prove me wrong, please share it in the comments below, then we can all profit. ;-)