Crypto trading bots: what are they?

WhiteBIT
Published 28 March 2022
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Crypto trading bots: what are they?

Content

The cryptocurrency market is dynamic and volatile. Successful trading takes a lot of time and effort – and even this is not always enough. A bot for trading on a crypto exchange is a program designed to simplify users’ experience and increase profits by automating market operations. In this article, we will look at how these programs work, what types of bots exist, and what advantages and disadvantages they have.

Cryptocurrency trading bots are stand-alone programs designed to allow traders to continuously monitor the market and not miss out on profitable deals. Bots can analyze data and perform transactions without user intervention 24/7.

Is it hard to trade using bots?

The developers strive to make bots easy to manage so that even inexperienced traders and users who do not have much time to trade can easily gain income.

Bots on crypto exchanges are common. However, before you start working with this software, you need to learn about its features. For example, simple bots buy assets when the price drops and sell when it rises. More complex programs include additional options that allow you to customize the algorithm according to personal preferences. For example, you can set the percentage required to enter a trade.

The classification of crypto trading bots 

There are several categories of crypto exchange bots:

  • arbitrage bots conduct operations on several exchanges, allowing the owner to profit from the difference in the value of currencies on different platforms;
  • trading bots review technical analysis indicators and make deals within a single platform;
  • advanced bots are customizable from scratch and are more suitable for experienced traders;
  • market-making bots add positions to both sides of the order book to stimulate market liquidity;
  • signal bots collect and analyze information to make trading recommendations;
  • script bots are open-source code that users configure manually.

Trading using a bot on a crypto exchange requires a deep understanding of its functions. One cannot expect positive results from the program without knowing how it works. You can practice using demo accounts to avoid the risk of losing money.

Where to get crypto trading bots?

The fastest way to get a trading bot is to buy one. Many companies develop such programs. The range is quite wide, so it is not difficult to find a suitable bot. Prices vary depending on the functionality and platforms on which the program works. Big developers also provide the option of a rental or a trial period, which significantly simplifies the selection process and saves time.

The most profitable option for getting a bot is a free download from the Internet. A huge number of programs for every taste are available. However, it is not very likely that the downloaded free software for trading will be as good as the bots developed by the companies with a good reputation.

Moreover, free crypto bots do not always come with instructions for configuration and use and documentation with the info about the developer. Firstly, this can result in launching an initially unprofitable algorithm and loss of funds. Secondly, the use of free cryptocurrency bots may be linked to fraudulent schemes. For example, along with such software, it is easy to install a virus miner or even a program that will transfer funds from your wallet to the scammer’s address.

To get a bot that suits your individual needs, you can make it yourself. A crypto exchange robot is a computer code, and if you know how to work with scripts and API, you can create the program yourself. This is not as difficult as it might seem because many exchanges provide ready-made functionality for this. Even though configuring a bot may take some time, the result is worth it – you get a unique helper adapted for your trading style and strategies.

Some of the best crypto trading bots

Let us have a look at some popular trading bots. The first one is Revenuebot. This option is great for beginners because it requires minimal user intervention. You only need to go through the initial settings. Moreover, Revenuebot is safe. The program works with verified exchanges and stores funds on these platforms.

Another attractive, profitable option is the Cryptorg platform. Its advantage is that it allows you to use an unlimited number of bots simultaneously (the only limitation is the number of trading pairs on a particular exchange). This option is suitable for both beginners and experienced traders. Cryptorg bots can be configured manually or use built-in strategies. Moreover, these robots allow users to receive CTG tokens as rewards for trades. It should also be noted that Cryptorg is a social network where traders can interact with each other.

Conclusion

A program for trading on a cryptocurrency exchange, or simply a bot, is a script designed to simplify the trading process. There are both ready-made bots designed for specific operations and more complex programs that need to be customized according to your needs. This technology is very flexible and can be helpful for all market participants.

FAQ

How to get a crypto trading bot?
Crypto trading bots can be purchased from developers, downloaded from the Internet, or created from scratch.
What types of bots are available to choose from?
There are several categories of crypto exchange bots: arbitrage bots, trading bots, advanced bots, market-making bots, signal bots, and script bots.