Digital currencies and the crypto market, in general, are among the most debated topics on Twitter. Now, it’s time to assess those measurements.
Popular social trading and multi-asset brokerage company eToro has designed a tool to measure investor sentiments on twitter. This is according to a piece by Bloomberg. On Tuesday, the trading platform announced that it launched a crypto sentiment-based portfolio. It will make use of AI to evaluate people’s general perception of crypto. These perceptions could be either positive or negative.
The crypto portfolio is possible due to a partnership with TheTIE. This platform allegedly has access to about 850 million tweets every day thanks to its collaboration with Social Market Analytics.
CEO of TheTIE, Josh Frank said that crypto currently has no valuation metric. He further added that: “With crypto, the only thing that really moves it is supply and demand, so we set out to develop sophisticated solutions for hedge funds to help value and trade the asset class.”
How it works
The crypto portfolio makes use of “highly advanced natural language processing tools” to scan tweets and assign them a sentiment score.
One of eToro’s focuses is to democratize the crypto market. This simply implies that both retail investors, mutual funds and professional institutions all have a level playing field in the crypto space. This recent portfolio is sure to fulfill this goal. It also comes with zero additional fees.
Managing Director of eToro (US), Guy Hirsch disclosed that: “The end result is that retail investors will have the chance to invest using a strategy that was previously only available to hedge funds”. He also stated that the majority of folks are curious about crypto. He added: “We believe with a tool like this, they will be much more comfortable.”
Price specialist and Head of Marketing at Rice University, Utpal Dholakia, had this to say about the announcement. He pointed out that evaluating tweets about crypto would contribute to a cycle. This will definitely give traders price making ability.
He also added that: “Crypto are niche markets, they are made up of a specialized group of investors and participants(…). Potential investors often tend to look for other investors’ behaviors to decide if they should buy a particular cryptocurrency.”
The minimum investment threshold in the product is $2,000.