Crypto Trading Bots 01: Everything You Need to Know

Trading Bots: Cryptocurrencies have undeniably changed the way we think about money. We can now work for ourselves, earn money, and transact on a global scale—it’s a dream come true. As we continue our arduous trading grind, we constantly ask ourselves, “Can it get any better than this?” Yes, 

Trading bots for cryptocurrency exist to make our trading easier, and what is technology if not tools that make our lives easier?

What exactly are trading bots, and how do they function?

They are exactly what you expect them to be. Crypto trading bots are computer programmes that, depending on how they are programmed, buy and sell cryptocurrency at the “correct” time. The bots’ goal is to make as much money as possible for you. To do so, they constantly monitor the market and react in accordance with a set of rules you define based on your preferences and tastes. This set of rules determines how your bot assesses market events like volume, orders, price, and time.

Unlike traditional markets, crypto markets never sleep. While trading is available 24 hours a day, seven days a week, it introduces a new problem for traders: no one can keep a constant eye on the market. Because we can’t keep a constant eye on the market, an 8-hour lull occurs while we sleep, leaving the possibility of waking up with potential losses or gains. This is where a crypto or Bitcoin trading bot can help. Here are a few of the strongest arguments for using a bot:

Are you looking for a way to save time? You can take a break, relax, and not worry about your open trades with these trading bots. Even the busiest traders require rest from time to time. You can make money with these bots without having to stare at a screen all day.

Trading bots are always online, and you’ll have a better chance of finding new trading opportunities because they can monitor the market for you 24 hours a day, seven days a week. The cryptocurrency market is notoriously volatile, as we all know. In this space, a never-ending opportunity-hunting bot that can exploit market conditions in a flash would be extremely useful. Of course, it depends on the bot’s parameters, but it will act if it detects an opportunity.

Finally, a bot would be able to eliminate trading’s emotional component. As humans, we’re all susceptible to the stress of day trading. Because of their volatility, crypto markets are even more stressful than traditional markets. This stress can result in emotions that influence our decision-making, which can lead to costly mistakes in the high-stakes world of crypto trading. A pre-programmed bot could assist us in combating our greatest foe: ourselves.

Trading bots are available in a wide range of sizes and shapes.

Before you get started, you’ll need to brush up on the various types of crypto and Bitcoin trading bots. Each caters to a specific type of trader, so pick the one that best fits your personality.

Arbitrage bots – If you’re not familiar with cryptocurrency arbitrage, it’s a trading strategy in which you buy an asset on one market and immediately sell it for a higher price on a different market, profiting from the price difference. Arbitrage bots have this trading strategy hardcoded.

Trend-trading bots – These bots try to profit by analyzing the momentum or swing of an asset. Even if the asset’s track is discerning, bots can use take-profit or stop-loss provisions.

Market-making bots – In order to profit quickly, these bots will place multiple buy and sell orders. Let’s say one dollar is the value of a cryptocurrency. If a market-making bot makes a buy offer for 0.99 USD and a sell order for 1.01 USD, you’ll make 0.02 USD profit if both orders are filled.

Coin-lending bots – These bots can assist you in automating the process of lending cryptocurrencies with interest rates. By doing so, it can also aid in the stabilization of interest rates and loan repayments.

Profile-automation bots – Rather than actively trading, these bots can assist you in creating, obtaining, and maintaining your ideal portfolio. This bot is used to automate as many mundane and repetitive tasks as possible.

There are other types of bots, such as our Paxful Trade Bot, in addition to the four main types of bots. This little chatbot is set up to help you find current offers and to notify you when a new one matching your criteria becomes available.

Are you looking forward to using a Bitcoin day trading bot? Apart from Paxbot, you have a slew of other options. To get you started, we’ve compiled a list of both free and paid trading bots.

Pionex is both a trading bot and a cryptocurrency exchange. Users have access to 12 free trading bots on this platform, allowing them to try out a variety of trading styles. For example, their Grid Trading Bot allows users to buy low and sell high within a set price range. Users can use their Smart Trade terminal to set a stop-loss or take-profit in trades. Other bots include the Leveraged Grid Bot and the Spot-Futures Arbitrage Bot.

Use of the accounts and bots is completely free. However, both users must pay a 0.05 percent fee on every trade.

Users can create automated trading strategies with Mudrex by dragging and dropping trading rules onto a drag-and-drop interface with pre-built indicators and patterns. For these strategies, back-testing and paper trading are also available, allowing users to test and refine their approach as they go. Users can also sell their successful strategies on the marketplace for a monthly fee.

Mudrex offers two pricing options: Mudrex Invest is free, but strategy creators charge monthly fees, and Mudrex Build costs 16 USD per month but allows users to create, test, and deploy their own trading strategies.

Wunderbit Trading is another platform that makes it simple to trade cryptocurrency. The platform has two distinct features: TradingView and the Spread-trading terminal. TradingView allows users to quickly create fully automated trading bots, while the Spread-trading Terminal allows them to pair multiple assets at once.

To get started, WunderBit is completely free to use. A free account allows you to trade manually, use trading bots, and copy trade (a strategy that will help you emulate some of the best traders on the platform). There are three plans to choose from if you want to take it to the next level: Basic (9.95 USD), Pro (24.95 USD), and Premium (49.95 USD) (44.95 USD).

3Commas, like Wunderbit Trading, is a cloud-based crypto asset trading platform. The platform includes a smart trading terminal, simple and composite trading bots, copy trading, and portfolio management. It has a dashboard that connects you to a few cryptocurrency exchanges and can be accessed from a desktop or mobile device. On the platform, you can choose from a variety of customizable trading bots and customize them to your liking using the configuration options.

The free plan allows you to try out 3Commas right now, but if you want more trading power, you should look into the paid options, which include the Starter plan (14.50 USD/month), Advanced plan (24.50 USD/month), and Pro plan (24.50 USD/month) (49.50 USD).

Gunbot is one of the most popular and oldest cryptocurrency trading bots available. It comes with up to 14 powerful pre-coded trading strategies, making it ideal for new traders who want to pick and choose which pairs they want to trade while the bot does the heavy lifting. For more experienced traders, Gunbot’s customization is second to none—you can tweak pre-programmed strategies or start from scratch to create your own fully customized and personalized approach.

Gunbot also comes with a powerful arbitrage bot that can do triangular arbitrage. Let’s say you have 100 USDT in total. Their bot can search for triangular arbitrage opportunities and purchase BTC. The bot can then profitably buy XRP with BTC and repurchase USDT with XRP.

Unlike the other trading bots on this list, Gunbot offers three different lifetime license packages: Standard (0.025 BTC), Pro (0.0375 BTC), and Ultimate (0.0500 BTC) (0.0625 BTC).

Trality‘s goal is to eliminate the divide between professional and private trading. To do so, they make automated trading bot technology available to everyone and assist them in becoming more knowledgeable traders.

When it comes to features, there are two Trality features that stand out. The first is the Trality Rule Builder, a simple but effective graphic interface that allows users to create trading bots by dragging and dropping indicators. It basically allows you to make your own trading algorithm without having to write a single line of code.

The second feature is the Python Code Editor. Let’s say you want to learn more about the algorithm’s inner workings. This feature is an in-browser code editor that allows you to build a trading algorithm in Python from the ground up.

Trality’s Pawn plan, which includes a live bot, a virtual bot, and a monthly volume limit of 5.00 EUR, comes with a free trial. There are three other packages to choose from if you want more trading power: the Knight plan (9.99 EUR), the Rook plan (39.99 EUR), and the Queen plan (49.99 EUR) (59.99 EUR).

Bitsgap is a one-stop trading platform that connects and consolidates some of the most popular exchanges under one roof, allowing you to sit back and relax while the system takes care of the heavy lifting.

Futures Trading Bots and Automated Trading Bots are among the trading bots available on the platform. Thanks to their top-notch tools found in their Trading Terminal, you’ll have everything you need to trade on multiple exchanges using a single interface.

You can get started for free with Bitsgap’s 14-day trial. All of the standard features are available, as well as a $1,000 USD trading limit. You can upgrade to the Basic Plan (19 USD/month), Advanced Plan (44 USD/month), or Pro Plan (110 USD/month) if you want to do more serious trading. These plans all come with more perks and higher trading limits.

Keep the dangers in mind.

It’s important to remember that, like any other investment, crypto trading bots have risks.

It’s also worth noting that these bots are designed for traders rather than investors. If you’re just a casual investor who likes to buy and hold assets, a trading bot might not be the best option. Those with financial literacy, analytical skills, and trading knowledge will always be ahead of those who do not, even if the platforms make it simple to get started.

In this area, you must also be wary of scams and hidden fees. Because cryptocurrency is such a new technology, it attracts a lot of bad actors. With this in mind, you should proceed with caution.

Think about the following issues: What is the platform’s team’s level of trustworthiness? Is there a public profile for them, as well as a support team? Is it possible to get in touch with them? What are the opinions of other customers on them? Is there an additional charge that I’m not aware of? It’s important to remember that the more you know about investing and trading, the better.

Keep in mind that, as appealing as these crypto trading bots may appear, they are simply tools that do not guarantee a profit. While most of these bots can be set and forget, a combination of automated trading and human supervision is often the best solution.

Bots require some re-adjustment in between trades because market conditions change so quickly, which is where human supervision comes in. You must adjust the bot’s strategy parameters on a regular basis to keep your money safe.

If you decide to use a trading bot, be aware of the risks and do your homework. Best wishes!