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What Is ChatGPT and How Can It Help Crypto?


Main Takeaways

  • In basic terms, ChatGPT is an AI chatbot. Users can type in any text they like — a question or prompt, for example — and ChatGPT will generate text in response.

  • ChatGPT is easy to use and can generate human-like responses quickly on a wide range of topics. As of February 2023, ChatGPT has been entirely free.

  • It’s important to recognize that ChatGPT lacks any real understanding of the text it is processing. Any response it gives should therefore be treated with caution.

  • When it comes to crypto adoption, ChatGPT offers great promise in terms of information and education. It can help educate users on blockchain and crypto concepts and make the technology more accessible to a wider audience.

We explain what ChatGPT is and how it works, look at its benefits and drawbacks, and explore how its existence can help crypto adoption.

ChatGPT is a state-of-the-art language model that can generate human-like text responses to a wide variety of prompts. It has seen huge interest from the general public since its November 2022 release. According to reports, it reached 100 million users after just two months.

“In 20 years following the internet space, we cannot recall a faster ramp in a consumer internet app,” UBS analysts wrote in a research note. In this article, we explain what ChatGPT is and how it works, look at its benefits and drawbacks, and explore how its existence can help with crypto adoption.

What Is ChatGPT?

In basic terms, ChatGPT is an artificial intelligence chatbot. Users can type in any text they like — a question or prompt, for example — and ChatGPT will generate text in response. The result is close to the experience of instant messaging with a real person.

ChatGPT was developed by OpenAI, an artificial intelligence research lab backed by Microsoft and originally co-founded by Elon Musk, Sam Altman, and others. OpenAI released ChatGPT as a free public prototype on November 30, 2022. As described by its developers, ChatGPT is about “optimizing language models for dialogue”. 

In OpenAI’s own words: 

“We’ve trained a [language] model called ChatGPT, which interacts in a conversational way. The dialogue format makes it possible for ChatGPT to answer follow-up questions, admit its mistakes, challenge incorrect premises, and reject inappropriate requests.” 

And so, the goal of ChatGPT is a simple one: to provide information in a conversational manner. In short, it’s a computer program that can respond to questions and engage in conversation — or at least give the appearance that it is doing so with its responses.

How Does ChatGPT Work?

ChatGPT works by using a deep neural network trained on a massive amount of text data. A neural network is a computer system modeled after the structure and function of the human brain. It is made up of a series of interconnected nodes — or artificial neurons — that can make decisions based on the information processed. 

In the case of ChatGPT’s neural network, there are multiple layers of these artificial neurons that can process and analyze input text in order to generate text as an output. The deep structure of the network means it can learn and generate text based on relationships and patterns in the data it has been trained on. 

During training, ChatGPT was given countless examples of input-output pairs, which allowed it to learn the relationships between language inputs and outputs. The material was taken from a wide range of internet text, including websites, books, and social media. The developers also curated and filtered the data to ensure its quality.

When an input prompt is given, ChatGPT uses its training to generate probabilities related to all the different possible responses. The one with the highest probability, based on its data, training, and own neural network, is then selected as the output.

The end result is an AI tool that can generate human-like responses.

The Advantages Of ChatGPT

Arguably, the biggest advantage of ChatGPT is how easy it is to use, as well as how it can generate human-like responses extremely quickly and (as of February 2023) for free.

The fact that it can generate text in response to almost any prompt and on a wide range of topics — thanks to its diverse training — means millions of users have found ways to use ChatGPT to make their lives easier.

For example, developers have used it to help debug code, creatives have used it to help write story prompts or song lyrics, while students have used it to help them understand difficult concepts. As long as the request can be formulated as a text-based input and output, then ChatGPT’s capabilities are extremely versatile.

As a result, ChatGPT’s existence can save both time and money. For example, in business terms, tasks that would otherwise require significant human effort, such as answering frequently asked questions from customers, could be handled by ChatGPT. 

The AI can deal with a large volume of customer support inquiries, thereby freeing up staff to focus on more complex tasks. This could improve efficiency and reduce costs.

The Disadvantages Of ChatGPT

Although ChatGPT is extremely impressive, users should be mindful that there are a number of drawbacks. Yes, it is extremely easy to use and produces convincing responses, but anyone using it shouldn’t get too complacent or switch off their critical thinking.

It’s important to recognize that ChatGPT has limited understanding and lacks basic common sense. Its responses may come across as human, but the bot doesn’t have a real understanding of the text it is processing. The language model is simply producing outputs based on probability distributions derived from its training and data. 

This means that it can generate misleading or even incorrect information. Problems with accuracy are also tied to the quality and substance of the data it was trained on. 

For example, the training data for ChatGPT had a knowledge cutoff of 2021, so the training process ended prior to that date. Ask ChatGPT about something that happened in 2022 onward and it has no way of accessing that information.

Problems with bias and privacy

Additionally, although the AI produces its own responses, it is influenced by the data it was trained on, and so can suffer from inherited problems of bias. The developers are the ones who choose what data to use for training, as well as what should be excluded or tagged as inappropriate. This means that their own biases are inherent in the system.

There are also question marks over security and privacy. ChatGPT is free to use (for now), and all information shared with it is said to be used by the developers to improve the product. However, it’s impossible to say how secure any information you put into ChatGPT is or who gets access to it.

Given the above, users shouldn’t become too over-reliant on ChatGPT. It’s better not to take its responses as facts just because it is an easy-to-use yet powerful AI. It is a tool and should be treated as such.

How Can ChatGPT Help Crypto Adoption?

As previously discussed, ChatGPT’s greatest asset is its ease of use and ability to provide human-like responses to questions across an extensive range of topics. In crypto adoption, the biggest benefit is how it can be used to answer questions about how to use crypto and the technology behind it.

Newcomers to the space are often put off by what are admittedly some pretty tricky concepts. Think about beginners trying to learn about “proof of work”, “bitcoin mining”, or “hashing”, for example. Of course, Binance Academy covers as much material as possible in an effort to help people learn about crypto. But ChatGPT has the benefit of being able to help clarify concepts in an interactive and conversational manner. Users can also keep asking it questions until they feel like they have fully understood whatever crypto-related topic it is they are interested in.

Coding and customer support

ChatGPT’s versatility has seen more advanced users leverage its abilities to help code trading bots, trading terminals, and even assist with smart contracts. As the technology becomes more developed, it will be increasingly easy for more people to use it to learn about crypto and perhaps actively participate in building the space.

Additionally, for the industry more generally, by automating customer support, ChatGPT can make it easier for individuals and businesses to get started with using crypto, thereby further increasing the rate of adoption. 

These are just a few examples of the ways ChatGPT and other large language models have the potential to help crypto. And that’s all at an early stage of this technology’s development. We look forward to seeing what else there is still to come!

Further Reading