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Modern asset management is currently based on algorithms that analyze financial data based on numbers. Numbers can tell a compelling story, if you know what to watch. But when it comes to the emotions, events, forecasts and developments that determine the decisions of human investors around the world, the numbers will never tell the full story.
The next frontier in asset management will be a tool able to analyze the nuances of human language.
A new AI based company in Seoul is developing an artificial intelligence tool that can do it, and will test it in the highly volatile but exciting cryptocurrency market, through a partnership with CoinPayments. CoinPayments is the largest altcoin payment gateway in the world, with over 1.4 million accounts in 182 countries.
This partnership will be interesting for some reasons. First of all, it represents a new level of sophistication for investments in the cryptoasset, which until now has been in some way an unregulated wild west, leaving many investors exposed to more risks than they would like.
Secondly, its success will be based on a bold statement made by Mind AI – which can develop an AI capable of reasoning in natural language.
Unlike natural language processing, which trains an algorithm to recognize patterns in the written word in order to manipulate language, the Mind AI system actually includes language, says John Doe, chief scientist at Mind AI.
"Our approach rejects the statistical modeling approach and instead focuses on understanding and reasoning of language as a foundation," Doe writes in a blog post. "We work outside of meanings, instead of models, we are building an engine that behaves like human reasoning, which means we can trace its processes and immediately identify errors in its logic and holes in its understanding."
Doe says that the artificial intelligence engine will move beyond the analysis of feelings to read, understand and reason with natural language to help make better decisions about investment and management.
"Asset management is a space in which we believe that artificial intelligence can quickly make a big impact," says Paul AI, MD, CEO and co-founder of Mind AI. "Working with the CoinPayments team, we will be able to create a proof of concept for asset management space that we can use as a framework for other applications."
