The benefits of data science for the cryptocurrency industry are unquestionable. I still remember reading the blog post by Satoshi Nakamoto when bitcoin was first founded back in 2008. Big data technology was still in its infancy back then. New developments have proven to be even more promising.
The biggest opportunities with bitcoin don’t pertain to the cryptocurrency itself. Rather, they are due to rapid advances in blockchain. Blockchain is rapidly being deployed in countless industries, as companies find new ways to leverage it.
Towards Data Science has written about some of these applications. They mentioned that big data has proven to be invaluable for blockchain by promoting predictive analytics, digital security and other features. Predictive analytics is one of the most important benefits that big data has brought to blockchain technology.
How Big Data Has Revitalized Predictive Analytics for Blockchain
Data Science is all about the analysis of data to extract useful insights. As a quickly evolving and exciting discipline, it’s powerful enough on its own. When paired with Blockchain, Data Science is turned into something far more structured and concrete, so it becomes even more useful.
Blockchain and Data Science are together changing the way many industries are operating. This is especially true in different industries that heavily rely on data, such as Finance. Performing predictive analysis when trading crypto markets, for example (or any other financial market for that matter) is made far more accurate and precise with these 2 powerful technologies working together.
Why is blockchain relevant to data science?
Salih Sarikaya explains on his post Big Data Projects on Blockchain: The Endless Solutions Blockchain Brings To Data Science that there are many companies, governments and organizations increasingly relying on actionable insights derived from large amounts of data to help them improve their decision making processes and improve their outcomes.
To make better decisions, it’s important to take advantage of an ever-increasingly large amount of data, whilst also ensuring that the integrity of that data is as high as it can be. Bad data leads to bad analyses, no matter how sophisticated the analysis techniques themselves are.
Thus, it is important to look for new technologies that can improve the way data is collected, stored, secured and use. This is where blockchain technology comes in.
Blockchain is mostly known for its relevance in the cryptocurrencies industry. It is used for digital currencies like Bitcoin. However, this is only one of many ways that blockchain technology can be used.
As it acts like a big open distributed ledger where all transactions processed through the network are recorded (with 0 possibility of modifying or deleting them), one can see how blockchain can help ensure the quality of the data analyzed, while also protecting it.
‘Blockchain does more than protect data’ explains Salih Sarikaya. ‘It improves the quality of insight obtained from the data by verifying data at the input and preventing malicious actors,’ he added.
Blockchain, data science and predictive analysis
As blockchain technology ‘brings a high level of reliability, trustworthiness, and veracity to data’, it is easy to understand how it can be used by data scientists to perform better predictive analysis of cryptocurrencies.
‘Predictive analytics describe the use of statistics and modeling to determine future performance based on current and historical data’ explains Investopedia. This method looks at patterns in data to determine when they might appear again, using them to improve performance by taking advantage of possible future events.
In term of use cases, blockchain applied to data science can disrupt just about any industry. Predictive analysts of cryptocurrencies can benefit massively from this, as they can harness big data to make more informed forecasts for the future of cryptocurrencies.
Enhancing predictive analysis methods through the use of blockchain can hugely benefit crypto-investors with better market intelligence tools. After all, finding a way to predict the future price action of a financial asset has always been a goal for traders, who need to build effective price forecast models. With data science and Blockchain working together, they have a way to do just that.
Blockchain Enthusiasts Should Monitor the Developments of Big Data and Predictive Analytics
Predictive analytics is fundamentally changing the dynamic of blockchain. Big data is advancing this technology in fascinating ways. What will it bring next?
