Big Data Offers Remarkable Valuation Tools for Cryptocurrency Speculators

Big data analysis could help bitcoin owners figure out when the bubble will end. Data analysis is a favorite tool of modern investors.

January 15, 2018
47 Shares 4,995 Views

Bitcoin Investors Need to use Big Data Analysis.

In the last few months, more people have talked about bitcoin than ever before. Even as the market begins to mature, a record number of people are still interested in investing in it.

Why?

A news report recently announced that the price of a single Bitcoin exceeded $15,000. Every second after it was published, the price rose. Speculators did one of two things:

  • Invested in Bitcoin or another Cryptocurrency
  • Sold a portion or all of their Bitcoins along with any other cryptocurrencies they had invested in.

What was the outcome of this?

The outcome of this sudden surge in people investing in cryptocurrencies drove record price increases, as expected. It didn’t take long for industry experts to report that it had reached its highest price ever recorded –  over $17,560 per coin. This record event took place on 11 December 2017.

In 2009, the price of a bitcoin was only $0.07. In other words, the price of bitcoins rose nearly 251,000 times in eight years!

Most people think that the price rose gradually over the years, but this isn’t the case.  Bitcoin only started to really spike in value after June 2017.

Is this spike a good thing?

Some people are very happy that the value of cryptocurrencies have surged. However, others are concerned about the sustainability of the market. The market may plummet as many speculators begin to reduce their holdings.

This is not a problem during periods when the value is on the rise. However, when the value of the coins stops climbing again, we’ll see a sudden drop in value. After this period, there will be some stabilization, where the value of the coins has reached a set value.

How can we prepare for the “sudden” drop in value?

There are many ways to prepare for a sudden drop in the stability of any currency. The best method is by making use of Big Data and Business Intelligence.

When we use Big Data and Business Intelligence in any industry, the main purpose is to identify trends and use data to make insightful decisions.

The things that I would look for in any data the you collect include increasing buzz around famous individuals dumping their shares. You’ll also want to look for any major headlines involving security flaws or previously unreported flaws in block-chain or other cryptocurrencies. This new technology closely ties these innovative cryptocurrencies to similar fates.

Learning How to Use Big Data Strategies

Big Data Strategies

Shutterstock / By Vasin Lee

To understand how to deploy Big Data collection efforts, and then perform analysis on them, you’ll need to attend a learning institution that specializes in these skills. The degree programs that you want to look for include:

  • Masters in Business Analytics
  • Bachelor of Science in Information Technology
  • Bachelor of Data Management

I would highly recommend avoiding the scam sites from random people offering online webinars with super-secret insights into the future of bitcoin. Instead, focus on proven, reputable learning institutions. There are even some overseas learning institutions that offer an opportunity for travel, like Forward Pathway.

SaaS Big Data Collection and Analysis Platforms

If you don’t have time to pursue a degree – and you probably don’t have 2 to 4 years before bitcoin peaks – you could always deploy a SaaS Big Data Analysis platform. These tools take all of the heavy lifting – coding, hardware installation and maintenance – off of your shoulders.

You will need to select some data pools that you want to scoop up and analyze. I already mentioned news headlines and social mentions, but there’s also financial history and blockchain transactions.

In fact, because the blockchain stores a record of every transaction on your computer, you could theoretically access and upload this information into a big data analysis tool. Then, you could extrapolate data like regular buy/sell patterns and more.

You must decide how this data is useful to you. It can be challenging. And algorithm complexity is only limited by your imagination. But for professional data scientists, this is probably the easiest way to get your hands on proprietary, useful data.

In conclusion, bitcoin is going gangbusters. A lot of it is hype, but there’s also the exciting advances that cryptocurrencies supported by blockchain have to offer. How you invest and sell bitcoin, whether actually mining, or investing in publicly traded stocks, is totally up to you.

I’d personally recommend only speculating with a small amount of money. The price has skyrocketed so much, that it’s pretty clear this is a bubble. If you make a profit over a month or two, I’d pull your money out right away. But, maybe your data analysis will tell you something different? Who knows!