“Hodling” is really the way to go when it comes to amassing Bitcoin (BTC). At least, that’s the conclusion reached by an artificial intelligence (AI) trading bot coded by a Portuguese software developer.
the bitcoiner Tiago Vasconcelos is the man behind the commercial experiment. Vasconcelos built an AI trading bot that would help him accumulate more Bitcoin and test his coding skills. Almost inconceivably, instead of trading, the bot quickly concluded that the best way to trade Bitcoin is to buy and hold it.
Vasconcelos is the main founder of Aceita Bitcoin, a Portuguese organization that promotes the adoption, education and exchange of information about Bitcoin. A Bitcoin enthusiast, he also dabbles in Bitcoin-related side projects.
He told Cointelegraph: “It was a reinforcement learning AI experiment, where I went and got a bunch of historical BTC/USDT data.” The code fetched and extracted daily price action from 2014 to 2021.
Vasconcelos then “trained him, or told him [al bot] the rules, here are the candles, you can buy, sell or do nothing”.
For every profitable trade, the bot would be rewarded with one point. The bot loses a point as a “punishment” for missed trades. Finally, a reward is given to the bot for the total amount of Bitcoin the bot ends up with:
“The goal is for the bot to get the highest possible score and the exercise is for it to make thousands/millions of attempts on that dataset, making a ‘mental’ path of when it’s best to buy, best to sell, etc.”
The beauty of the AI is that the bot begins to observe “patterns” and what Vasconcelos describes as “moves” that the bot makes to maximize its trading score.
“Eventually the bot concludes that the best move is to buy as soon as possible and never sell.”
There you have it, now it’s not just the popular talking heads and even the banks in the Bitcoin space that are yelling “Hodl”. Even bots are hodlers.
Hodl is a popular meme in the Bitcoin space, originating from a Bitcointalk forum post in 2013 by an intoxicated contributor who misspelled hold. The reason the original commenter, GameKyuubi, decided to hodl was “because I’m a bad trader and I KNOW I’M A BAD TRADER”.
Turns out it could have been as smart as artificial intelligence all along.
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