Deep Learning Models for Bitcoin Prediction Using Hybrid Approaches with Gradient-Specific Optimization

Amina Ladhari and Heni Boubaker ()
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Amina Ladhari: Economics, Management and Quantitative Finance Research Laboratory (LaREMFiQ), Institute of High Commercial Studies of Sousse, Economics and Quantitative Methods Department, University of Sousse, Sousse 4054, Tunisia
Heni Boubaker: Economics, Management and Quantitative Finance Research Laboratory (LaREMFiQ), Institute of High Commercial Studies of Sousse, Economics and Quantitative Methods Department, University of Sousse, Sousse 4054, Tunisia

Forecasting, 2024, vol. 6, issue 2, 1-17

Abstract: Since cryptocurrencies are among the most extensively traded financial instruments globally, predicting their price has become a crucial topic for investors. Our dataset, which includes fluctuations in Bitcoin’s hourly prices from 15 May 2018 to 19 January 2024, was gathered from Crypto Data Download. It is made up of over 50,000 hourly data points that provide a detailed view of the price behavior of Bitcoin over a five-year period. In this study, we used potent algorithms, including gradient descent, attention mechanisms, long short-term memory (LSTM), and artificial neural networks (ANNs). Furthermore, to estimate the price of Bitcoin, we first merged two deep learning algorithms, LSTM and attention mechanisms, and then combined LSTM-Attention with gradient-specific optimization to increase our model’s performance. Then we integrated ANN-LSTM and included gradient-specific optimization for the same reason. Our results show that the hybrid model with gradient-specific optimization can be used to anticipate Bitcoin values with better accuracy. Indeed, the hybrid model combines the best features of both approaches, and gradient-specific optimization improves predictive performance through frequent analysis of pricing data changes.

Keywords: cryptocurrency; Bitcoin; forecasting; machine learning; deep learning; LSTM; gradient-specific optimization; attention; ANN; dataset (search for similar items in EconPapers)
JEL-codes: A1 B4 C0 C1 C2 C3 C4 C5 C8 M0 Q2 Q3 Q4 (search for similar items in EconPapers)
Date: 2024
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