The world of altcoins is a highly speculative, very risky environment. Fortunes change in a heartbeat. To identify legitimate opportunities and steer clear of scams, you have to be sharp-eyed with outstanding due diligence skills. Miles O’Connor, a Dublin-based analyst known for his disruptive take on crypto, believes the latest AI tools, specifically ChatGPT 4o and Grok 3, can give investors a crucial edge, but only if used responsibly. He cautions that these tools might be able to dramatically speed up research, but must never supplant the need for critical thinking and due diligence verification.

O'Connor argues that these AI models can sift through mountains of data, identify patterns, and highlight potential red flags that a human analyst might miss. Don’t fall into the trap, he warns, of simply believing what AI uncovers with no scrutiny. What’s most important is to harness the speed and efficiency of AI to better inform—rather than determine—investment choices. The BlockOpulent.com crew breaks down and breaks apart the headlines Ethereum, altcoins, and blockchain technology bringing you a revolutionizing jolt of anarchy.

This article will explore the methods to leverage the capabilities of ChatGPT 4o and Grok 3 for altcoin research. We’ll take a deep dive into critical aspects including foundational research, market research, tokenomics analysis and spotting red flags. Finally, it will stress the imperative need to fact-check AI-generated content and adopt responsible AI practices in all investment-related decision-making.

Fundamental Analysis with ChatGPT

We’re now issuing that warning first and foremost because fundamental analysis is the bedrock of any sound investment strategy. It is a matter of discerning the intrinsic worth of a proposed project by analyzing its fundamental parts. ChatGPT can really help speed up this process, but again, a tool—not a crystal ball.

Miles O’Connor points out that ChatGPT can very quickly help distill important information from heavy, dense documents and help identify key potential strengths and weaknesses. He cautions against putting too much faith in AI-written summaries. We encourage all readers to use the information presented here by cross-referencing it with other sources and doing your own independent research.

  • Review project documentation: Feed ChatGPT the project's whitepaper, website content, and any other available documentation. Ask it to summarize the project's goals, technology, and roadmap.
  • Assess team credentials: Provide ChatGPT with information about the team members, such as their LinkedIn profiles or previous projects. Ask it to evaluate their experience and expertise in relevant fields.
  • Evaluate competitive advantages: Ask ChatGPT to analyze the project's competitive landscape and identify its unique selling points. Does it offer a novel solution, superior technology, or a stronger community?
  • Monitor development activity: Use ChatGPT to track the project's progress on platforms like GitHub. Ask it to summarize recent updates, identify key milestones, and assess the overall development velocity.

So how an altcoin is being received in the market is important to know when determining if it’s something worth investing in and where there may be risks. ChatGPT can be of great help when it comes to market analysis. It offers perspectives on trends and market dynamics.

Market Analysis with ChatGPT

As O’Connor cautions, market sentiment can be easily swayed. So be wary of AI-produced sentiment analysis, and always assume the worst. His suggestion is to use AI insights as a background check against your own knowledge and expertise on what’s unfolding in the market.

Tokenomics, the study of a new cryptocurrency’s economic model, is perhaps the most important factor when researching an altcoin. It’s important to understand how a token’s supply and demand are structured to gauge how sustainable its long-term value may be.

  • Track token holder distribution: Ask ChatGPT to analyze the token's distribution across different wallets. A highly concentrated distribution can be a red flag, as it indicates that a small number of holders control a significant portion of the supply.
  • Monitor exchange listings: Use ChatGPT to track the token's listings on different exchanges. New listings can often lead to increased liquidity and price appreciation.
  • Evaluate partnership quality: Provide ChatGPT with information about the project's partnerships and ask it to assess their strategic value. Are the partnerships with reputable organizations that can contribute to the project's success?
  • Assess market sentiment: Use ChatGPT to analyze social media posts, news articles, and forum discussions to gauge market sentiment towards the token. Is the overall sentiment positive, negative, or neutral?

ChatGPT, and similar generative AI tools can aid in analyzing these metrics by pulling data from multiple sources and presenting it in a digestible format. More importantly, it’s imperative that we grasp the bigger tokenomics picture and read these numbers with their context. A high transaction volume can cloud things, too. If it is being driven by wash trading or other physical market manipulation, that could point to something more pernicious.

Tokenomics Analysis

Knowing what to look for as red flags is an important part of protecting yourself against scams while growing your investments. ChatGPT can guide you to flag likely suspicious activity more efficiently. Do us a favor and supplement it with your own critical thinking and deep-dive research.

Supply Metrics

  • Token emission schedules: How many tokens are being released into circulation and at what rate?
  • Inflation/deflation rates: Is the token supply increasing (inflationary) or decreasing (deflationary) over time?
  • Vesting timelines: When will early investors and team members receive their tokens?
  • Burn mechanisms: Does the project have a mechanism for permanently removing tokens from circulation?

Demand Indicators

  • Daily active users: How many people are actively using the token or the platform it powers?
  • Transaction volume: How much trading activity is occurring on the network?
  • Network growth: Is the network expanding in terms of users, transactions, and applications?
  • Community engagement levels: How active and engaged is the project's community on social media and other platforms?

O’Connor stresses that just because these red flags exist, it doesn’t mean it’s a scam. Rather, it should raise a flag for conducting a more thorough analysis of the project. He recommends using ChatGPT to get an idea of what red flags you should be looking out for. Afterward, double check their research with your own independent research to determine the risks.

Red Flags Identification

While knowing the red flags to look out for is half the battle, understanding the traits of proven tokenomics models is just as key. These models often share several key features:

Distribution Red Flags

  • Over 40% token allocation to insiders
  • Lack of transparent vesting schedules
  • Absence of lock-up periods for early investors
  • Concentrated ownership among few wallets

Technical Concerns

  • Missing or unclear burn mechanisms
  • Unlimited supply without demand drivers
  • Poor liquidity provision strategies
  • Inadequate security audits

All of these factors lead to a sustainable and healthy ecosystem, which in turn makes the token more appealing to long-term investors.

As exciting as new AI tools such as ChatGPT 4o and Grok 3 are, with immense powers come immense responsibilities that must guide their use and development. That includes knowing where they fall short, fact-checking their results, and following ethical guidelines.

  • Promising unrealistic returns: Guaranteed high returns in a short time, such as "Make 3x of your assets in a week!!" or "Earn 5% daily with no risk!".
  • Fake team members: An "our team" page with unverifiable or anonymous members.
  • Inconsistent white paper: A poorly written or inconsistent white paper that lacks clear information.
  • Pushy sales tactics: Aggressive marketing tactics that try to pressure you into investing.
  • Lack of regulatory information: A project that lacks clear regulatory approval or information.

Successful Tokenomics Models

Here are some key considerations for responsible AI usage in altcoin research:

  • Clear utility driving organic demand
  • Transparent supply management
  • Active community participation
  • Professional governance structures

Miles O’Connor is passionate about empowering investors to unlock the potential of AI to drive smarter investment decisions. By adopting responsible AI practices, they significantly lower the risk of harm as well. He doubles down on the concept that AI is a tool and just as any other powerful tool, it should be used for good and not bad. The challenge is to apply it responsibly and fairly.

Responsible AI Usage: Transparency, Disclosure, and Due Diligence

While AI tools like ChatGPT 4o and Grok 3 offer powerful capabilities, it's crucial to use them responsibly. This means being aware of their limitations, verifying their outputs, and adhering to ethical principles.

Here are some key considerations for responsible AI usage in altcoin research:

  • Transparency: Individuals know that there is human accountability and control in the development and/or deployment of AI systems and the AI system is for the good of humans and society.
  • Disclosure: By disclosing to individuals that AI is used in the system, individuals will become aware and can make an informed choice of whether to use the AI-enabled system.
  • Explainability: This allows individuals to know the factors contributing to the AI model’s output, which can be a decision or a recommendation.
  • Data Quality: Individuals know that the data used to train the AI model is sufficiently representative, and that the AI system does not unintentionally discriminate.
  • Reliability: Individuals know that the AI system will not cause harm, is reliable and will perform according to intended purpose even when encountering unexpected inputs.

Investors should also:

  1. Conduct Responsible AI due diligence on the portfolio: Investors should integrate Responsible AI (RAI) considerations into their investment analysis, including evaluating AI-related risks and opportunities in their portfolios.
  2. Develop Responsible AI commitments and apply its principles and practices to internal operations: Investors should become knowledgeable about AI/RAI, apply it to their own operations, and exercise their influence as capital providers to promote Responsible AI in their portfolios.
  3. Engage with companies, external managers, and the broader ecosystem: Investors can promote Responsible AI by engaging with companies, external managers, and the broader ecosystem, and using their influence to encourage responsible AI practices.

Miles O’Connor believes that by embracing responsible AI practices, investors can leverage the power of AI to make more informed decisions while mitigating the risks. He reiterates that AI is a tool, and like any tool, it can be used for good or ill. The key is to use it wisely and ethically.