Overview / Usage

Bitcoin, the most famous open-source cryptocurrency in the world, has been gaining popularity in peer-to-peer electronic cash payment and trading [1]. Built on top of Blockchain, a network leveraging cryptography to maintain all the transactions, Bitcoin is immune to a wide range of hacking activities. Since the network that lies behind is a decentralized one, there is no daily limit unlike regular financial instruments such as stocks, bonds, and securities. This indicates that Bitcoin can be highly profitable if a trading algorithm is used. However, due to its short history and lack of data, Bitcoin is relatively unpredictable compared to traditional financial instruments. Three approaches are presented to accurately predict the price movement of Bitcoin: deep learning models based on historical bitcoin price data, predictive models based on Natural Language Processing (NLP) for social media, and traditional machine learning models based on Dynamic Time Wrapping (DTW) from historical data of exchange platforms.