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    Chapter Itcoin

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    ibrex29
    The document discusses using machine learning algorithms to predict bitcoin prices. It examines using different modeling techniques on samples with varying data structures and dimensional features. Statistical methods like logistic regression and linear discriminant analysis achieved 66% accuracy on daily price predictions, outperforming more complex algorithms. For 5-minute interval predictions, machine learning models like random forest and XGBoost reached 67.2% accuracy, superior to statistical methods.

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    Chapter Itcoin

    Uploaded by

    ibrex29
    17 views3 pages
    The document discusses using machine learning algorithms to predict bitcoin prices. It examines using different modeling techniques on samples with varying data structures and dimensional features. Statistical methods like logistic regression and linear discriminant analysis achieved 66% accuracy on daily price predictions, outperforming more complex algorithms. For 5-minute interval predictions, machine learning models like random forest and XGBoost reached 67.2% accuracy, superior to statistical methods.

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    The document discusses using machine learning algorithms to predict bitcoin prices. It examines using different modeling techniques on samples with varying data structures and dimensional features. Statistical methods like logistic regression and linear discriminant analysis achieved 66% accuracy on daily price predictions, outperforming more complex algorithms. For 5-minute interval predictions, machine learning models like random forest and XGBoost reached 67.2% accuracy, superior to statistical methods.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    17 views3 pages

    Chapter Itcoin

    Uploaded by

    ibrex29
    The document discusses using machine learning algorithms to predict bitcoin prices. It examines using different modeling techniques on samples with varying data structures and dimensional features. Statistical methods like logistic regression and linear discriminant analysis achieved 66% accuracy on daily price predictions, outperforming more complex algorithms. For 5-minute interval predictions, machine learning models like random forest and XGBoost reached 67.2% accuracy, superior to statistical methods.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    Bitcoin Price Prediction Using Machine Learning Algorithms

    ABSTRACT
    After the boom and bust of cryptocurrencies’ prices in recent years, Bitcoin has been increasingly
    regarded as an investment asset. Because of its highly volatile nature, there is a need for good
    predictions on which to base investment decisions. Although existing studies have leveraged machine
    learning for more accurate Bitcoin price prediction, few have focused on the feasibility of applying
    different modeling techniques to samples with different data structures and dimensional features. To
    predict Bitcoin price at different frequencies using machine learning techniques, we first classify
    Bitcoin price by daily price and high-frequency price. A set of high-dimension features including
    property and network, trading and market, attention and gold spot price are used for Bitcoin daily price
    prediction, while the basic trading features acquired from a cryptocurrency exchange are used for 5-
    minute interval price prediction. Statistical methods including Logistic Regression and Linear
    Discriminant Analysis for Bitcoin daily price prediction with high-dimensional features achieve an
    accuracy of 66%, outperforming more complicated machine learning algorithms. Compared with
    benchmark results for daily price prediction, we achieve a better performance, with the highest
    accuracies of the statistical methods and machine learning algorithms of 66% and 65.3%, respectively.
    Machine learning models including Random Forest, XGBoost, Quadratic Discriminant Analysis,
    Support Vector Machine and Long Short-term Memory for Bitcoin 5-minute interval price prediction
    are superior to statistical methods, with accuracy reaching 67.2%. Our investigation of Bitcoin price
    prediction can be considered a pilot study of the importance of the sample dimension in machine
    learning techniques.

    CHAPTER ONE
    INTRODUCTION

    Bitcoin is a crypto currency used worldwide for digital payment or simply for investment purposes.
    Bitcoin is decentralized i.e. it is not owned by anyone. Transactions made by bitcoins are easy as they
    are not tied to any country. Investment can be done through various marketplaces known as “bitcoin
    exchanges.” These allow people to sell/buy bitcoins using different currencies. The largest bitcoin
    exchange is Mt Gox. Bitcoins are stored in a digital wallet which is basically like a virtual bank
    account. The record of all the transactions, the timestamp data is stored in a place called Blockchain.
    Each block contains a pointer to a previous block of data. The data on blockchain is encrypted. During
    transactions the users name is not revealed, but only their wallet ID is made public.
    Predicting the future is no easy task. Many have tried and many have failed. But many of us would
    want to know what will happen next and would go to great lengths to figure that out. Imagine the
    possibilities of knowing what will happen in the future! Imagine what you would have done back in
    2012 when Bitcoin was less than $15 knowing that it would surpass $18,000! Many people may regret
    not buying Bitcoin back then but how were they supposed to know in the first place? This is the
    dilemma we now face in regards to Cryptocurrency. We do not want to miss out on the next jump in
    price but we do not know when that will or will not happen. So how can we potentially solve this
    dilemma? Maybe machine learning can tell us the answer.
    Machine learning models can likely give us the insight we need to learn about the future of
    Cryptocurrency. It will not tell us the future but it might tell us the general trend and direction to expect
    the prices to move. Let’s try and use these machine learning models to our advantage and predict the
    future of Bitcoin by coding them out in Python!
    Existing System

    After the boom and bust of crypto currencies’ prices in recent years, Bitcoin has been increasingly
    regarded as an investment asset. Because of its highly volatile nature, there is a need for good
    predictions on which to base investment decisions. Although existing studies have leveraged machine
    learning for more accurate Bitcoin price prediction, few have focused on the feasibility of applying
    different modeling techniques to samples with different data structures and dimensional features. To
    predict Bitcoin price at different frequencies using machine learning techniques, we first classify
    Bitcoin price by daily price and high- frequency price. A set of high-dimension features including
    property and network, trading and market, attention and gold spot price are used for Bitcoin daily price
    prediction, while the basic trading features acquired from a cryptocurrency exchange are used for 5-
    minute interval price prediction.

    Proposed System

    Statistical methods including Logistic Regression and Linear Discriminant Analysis for Bitcoin daily
    price prediction with high-dimensional features achieve an accuracy of 66%, outperforming more
    complicated machine learning algorithms. Compared with benchmark results for daily price prediction,
    we achieve a better performance, with the highest accuracies of the statistical methods and machine
    learning algorithms of 66% and 65.3%, respectively. Machine learning models such as Long Short-
    term Memory for Bitcoin 5- minute interval price prediction are superior to statistical methods, with
    accuracy reaching 67.2%. Our investigation of Bitcoin price prediction can be considered a pilot study
    of the importance of the sample dimension in machine learning techniques.

    Problem Statement

    The objective of this proposed system is to develop an application which will predict the bitcoin prices
    in future with decent accuracy. This allows the investors to invest wisely in bitcoin trading as the prices
    of bitcoin have gone up to an exaggerating amount in the last ten years.

    Aim and objectives

    Aim

    The aim of this project is to develop a machine learning algorithms for the price prediction of
    Bitcoin while using technical indicators as inputs.

    Objective of the Project

    The objectives of the “Bitcoin Price Prediction System” can be stated as follows:

    The objectives of this thesis are:

    1. To find out the ML algorithms that can be used for the prediction of Bitcoin prices.
    2. To compare the predictions of ML algorithm using various evaluation metric scores.
    3. To find out which among the technical indicators taken as input has more effect on the
    prediction of each model

    Scope and limitation of the Study

    This project aims to identify and compare ML algorithms that can predict the price of Bitcoin using
    technical indicators as input. It also strives to find out which among the technical indicators has more
    effect on the prediction of each model.

    Research Questions
    RQ1: Which ML algorithms are better suited to predict the prices of Bitcoin?

    RQ2: Which among the selected ML algorithms performs the best in predicting the price of
    Bitcoin when using technical indicators RSI, EMA, SMA as input, and which among these
    indicators affects the prediction performance of each ML algo

    rithm the most?

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