An experimental artificial intelligence (AI) bot was made available by the European-based digital asset management platform CoinShares on Thursday, and it may be able to assist traders in determining a fair price for some non-fungible tokens (NFT).
A user can get what the experimental project CoinSharesNFTAI, which collects several data sets, considers to be a fair price for a changing selection of the top NFT collections on OpenSea, the most well-liked NFT marketplace. You must copy the OpenSea URL for a specific NFT of interest and tweet it to the bot in order to communicate with it. The bot will then reply with a rough estimate.
Doodle #8859, was last sold on October 18, 2021 for 4.5 ETH, or around $16,800 at the time, was used by CoinDesk to communicate with the bot. The bot claims that the NFT's value has subsequently dropped to 9.61 ETH, or around $12,234.
According to CoinShares, the bot computes the prices of "the freshest collections." once every week using an algorithm. This includes high-profile initiatives like CryptoPunks, Bored Ape Yacht Club, Clonex, Moonbirds, Doodles, Azuki, and 44 more during the week of October 10–16. As of Thursday, the bot does not classify any NFT projects as a "permanent collection." despite the fact that it would eventually have permanent collections that it returns pricing on.
"Pricing NFTs is no easy task," the business tweeted on Thursday.
The technique used by the bot to create a price index from "thousands of NFT transaction records." is said to be based on the hedonic model. Its data focuses on Ethereum NFTs and downloads the properties and previous sales of certain NFT collections using Opensea's official API.
By Thursday afternoon, many users had tweeted the bot, which had responded with numbers that, in some cases, were far less favorable than the best offers currently being offered on OpenSea. When the projected value of their possessed NFTs came back lower than anticipated, a number of customers questioned the accuracy of the program.
Jack Hermes, known as systemic bliss, tweeted "Your model sucks lmao", for his GoblinTown NFT that he purchased on July 8 for 2.6 ETH (roughly $3,170) was valued at 0.88 ETH, or about $1,124.48.
According to him, "The AI thought its value was below the [current] floor price," "That was interesting, so I figure it suggests the price that will get bought quickest."
A representative for CoinShares stated that although the pricing of NFT may appear mysterious, it is really driven by "many factors" including hype, rare characteristics, and practical value.
Even hype is not as elusive a factor as it may seem, the spokesman added. "Some of these attributes are quantifiable – even hype is not as elusive a factor as it might seem. To evaluate the hype of a specific collection, we can count its followers on social media platforms, as well as the volume and value of past transactions. The same applies to rarity within a collection, by looking at the attributes of the asset. "
"An NFT collector may rely on market research or follow sentiment on social media to get a feel for each NFT’s value, but they might not put a specific number behind it," the representative continued. "Our model accesses the same data but uses complex mathematical operations to make the best price prediction possible."
However, the spokesman emphasized that the bot is currently only a "prototype" and uses only a small amount of data in comparison to the numerous potential indicators available in the NFT market.
"Use it to experiment with NFTs and your collection, and not as the sole data point to make purchase and sell decisions," the spokesman suggested.
By fLEXI tEAM