If you follow the cryptocurrency space at all, you know that Twitter is a fantastic place for checking out news, prices, and the general sentiment behind different assets.
eToro, the “social trading and multi-asset brokerage company” is aware of this, and is putting out a self-described “trading strategy” for its cryptocurrency traders based on the information available via the social media platform. They’re calling it TheTIE-LongOnly CopyPortfolio, due to its partnership with the Tie analysis platform.
Guy Hirsch, the Managing Director at the United States side of eToro, commented on the collaboration:
“In traditional markets, retail investors have historically lagged behind the ‘smart money’ when it comes to the data and tools available to them. This puts individual investors at a major disadvantage. In the spirit of crypto and decentralized technology, we believe that offering institutional-grade tools to every investor will level the playing field and democratize investing.”
Price-tied perceptions
Of course, this could only work because cryptocurrency market changes are so tied to user perceptions. According to the post, Tie’s platform takes in 850 million tweets a day, which provides it a relatively accurate sentiment of how people are viewing the market, one can conclude.
Interestingly, the Tie has had this strategy around since October 2017 and has been refining it ever since. The post notes that their algorithm has brought in an average return of 123% on an annual basis.
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Disclaimer: Transacting in virtual currencies is subject to various risks, such as price volatility, and is therefore not suitable for everyone. Your capital is at risk. eToro offers only Crypto (real crypto no CFD) so only buy with no leverage, later on this year eToro will also offer real stocks for trading.
