Watermelon Block: A new blockchain based on NEM building an AI app and bot that trades cryptocurrency based on the idea of “sentiment” – i.e. what the market “feels” about a crypto.
When you are new to cryptocurrency, and you just want to get some of this hot new crypto into your digital wallets, it can be disconcerting and unsettling to find out just how much and how quickly cryptocurrency prices can go up and they can go down.
It’s not necessarily like buying a car, where you know the value will go down slowly over time, or into real estate, where you know the value will likely slowly appreciate. In crypto, prices can go up a thousand times in a month practically, or just go down to a fraction of it’s original ICO value after launch.
In Q2 2018, the average person who invested into cryptocurrencies during ICOs lost 50% of their investment, with most tokens going down on average 50% from ICO public sale price (source ICOrating.com). (If you got in during private sale, however, say as part of an accredited investment pool, where the prices are heavily discounted from public sale price a bit like buying wholesale, you probably didn’t do so badly, or at least broke even.)
Crypto prices go up, and they go down. And one of the things that can influence it are the things being said about a particular blockchain and cryptocurrency in social media and online news platforms. If there are bad things being said about a crypto on social media, and the sentiment becomes wide spread, then you can pretty much predict that the prices of the tokens will be going down and going down hard. That’s why no telegram channel admin likes FUD in their chat stream!
Technical analysis is one way to predict future prices, but it doesn’t take into account hot human emotions, which can be so greatly influenced by what is said, and, when taking into account the positive feedback effect, can hugely exaggerate what otherwise might have been a small dip or a small lift. And blockchain, as it stands, is a hugely emotive arena where rival chains struggle for ultimate adoption. Right now, in the bear market, we are seeing a Lord of the Flies survival of the fittest style scenario in terms of market caps. Check out Vitalik ripping shreds out of EOS for example.
So what do you do, if you’re just an average person with some spare dough, who doesn’t have time to follow the social media threads of ALL the tokens you might like to hold a few hundred of in your wallets? Well, Watermelon Block has the solution for that. A technology development house based in Singapore, but operating out of Melbourne, they are developing a mobile phone app right now, based on IMB Watson, that will track HUNDREDS of crypto tokens in the public media, and come up with a sentiment “score” for each.
Checking in on the sentiment of a token you own will be free, but you will need to subscribe for an upgrade of services that will unlock further features like tracking a token over time and alerts. One of these advanced features down the track will be an automatic trading bot, that will trade in and out of the tokens that you own in your Watermelon Block wallet, so that you never see an overall loss in value of your total crypto asset portfolio, but still get to own your preferred tokens in your wallet over time – think technical analysis trading bot mixed with an AI awareness of the impact of human emotions, and you have the winning picture.
I talked to Watermelon Block Co-Founder Sonia Miles-Khan in an extended interview, shown here, and I can’t wait to beta test the new app. There’s many other potential business applications for the technology of course, too – such as SMEs being able to keep track of the sentiment score of their own brand, or art dealers being able to assess what is thought worldwide about a particular piece of art.
I can’t help but think of what an amazing service this will be for marketing departments and consultants who otherwise have to rely on centralized social media insights, who will be able to just subscribe and get real time information about what the public really think about their product and service. I can imagine is that this could possibly lead to a lot less waste in the world, with less products that aren’t really wanted being manufactured in the first place, and more of what is wanted being made – without people having to be force fed a product via marketing, in order to buy a product that they didn’t want in the first place and was never need.
I guess political parties could use this technology, too, to find out about what people really think of their policies – a far better way to approach political reform than simply sacking yet another prime minister!
So, check out the video, and listen to Sonia’s own thoughts about why she founded Watermelon Block, how they are building the tech, what it will do, and why it will be a vital tool in your crypto asset toolkit not to far into the future.