Disclaimer: The contents of this article are not financial advice and you should do your own research before investing. This article is for informational purposes only and does not reflect any position of the author nor U.Today.
The cryptocurrency market is one that never sleeps. Nor will it be merciful to the sleeping trader: a lot can happen in eight, long hours of sleep. To help traders cope with a 365/24/7 market, one may employ a cryptocurrency trading bot. What can a crypto bot do? It can make more calculated trades based off of data and algorithms better than a person could, and it works tirelessly to ensure it makes its owner as much money as it can.
Bitcoin bot trades buys and sells
Crypto trading bots are programs that talk to exchanges and make trades on your behalf. For example, there is a Poloniex trading bot that will work with that exchange to execute trades that work in your favor. Bitcoin trading bots make informed decisions by watching the market’s price movements and reacting according to a set of predefined rules and user-set parameters.
Best Bitcoin trading bots
Remember, that crypto trading is still in its wild, wild west phase and there are others out there with ill intent to take your hard-earned cash or hack your system, be wary of false bots. Here is a helpful list of some reliable and credible automated Bitcoin trading robots.
- Gekko - Free Bitcoin trading bot that works on Bitfinex, Poloniex and Bitstamp. It does not execute arbitrage trades across exchanges.
- Haasbot - Makes trades on Poloniex, Bitfinex, BTCC, GDAX, Huobi, Kraken and Gemini. The automated Bitcoin trading bot also trades other altcoins on these exchanges. It costs .32 BTC every three months.
- Zenbot - Trades with artificial intelligence across exchanges and makes arbitrage trades. The software can perform multiple cryptocurrency trades simultaneously.
- Crypto Trader - Is a cloud-based trading bot that has a unique feature that allows users to trade their trading strategies with each other. It is supported by Coinbase, BITe and Bitstamp.
- BTC Robot - Is one of the early crypto trading bots on the market. For $149 per month, it will allow investors to trade. However, it is a bit more advanced and some users might not understand some features and end up taking big losses. It comes with a 60-day-money-back trial.
- USI Tech - This crypto bot isn’t really a bot but rather a FOREX trader that offers a Bitcoin exchange. While it does not offer its users direct control, it guarantees them daily profit from the trades. Customers choose a preferred Bitcoin investment plan which then earns them 1 percent of their capital, daily. Strange, because how can you profit every day?
- Gunbot - Gunbot executes up to 6-precoded-professional-trading strategies automatically. It will buy and sell coins following the trading strategy the user chooses. One unique feature is that it will suspend trading automatically during times of market volatility.
- Margin - is a newer bot that currently only has support from Bittrex, Bitstamp, Bitfinex, Poloniex, OKCoin and Huobi. It uses only two strategies: Ping pong and margin maker. It has lower costs than others, depending on the balance of your portfolio.
- Bitconnect - is not a bot but rather a lending service, where users lend their capital to the system and then get a 1 percent guaranteed return
- CATBot - Is a newer crypto bot that can have wide support of most exchanges and many coins. It uses a ping-pong strategy to make the most of your investment and has a crash escape plan should the market tank, the user can set an exit stop-loss limit where all coins are sold.
History of Automated Bitcoin Trading
Joseph Lee was one of the first Bitcoin bot traders, who pioneered and implemented trading bot technology. In a novel move, he basically bought all of his Bitcoins on tertiary markets and then resold them on other markets and thus created a market where there wasn’t any in the first place.
He thought outside the box and created his own market trends and capitalized from them. This was back between 2011 and 2013 when so much of what we have to in the crypto world was not around and many people were not yet aware. So it would be easy to cause mass fluctuations in the market when trading volume was much lower than it is today.
In these early days of trading cryptocurrencies, Lee saw an opportunity to arbitrage across brokers using Bitcoin arbitrage bots. His BTC bots were responsible for shifting up to 10 percent of the entire market volume during early growth stages. This was a massive injection of liquidity into the markets.
Ready to hire a crypto bot to invest for you? Keep these thoughts in mind.
Trading bots can help investors, traders and even newcomers to ensure that they are always interacting with the market, even when they are physically unable to do so - if you happen to work or sleep it’s hard to be linked to the market at all times.
Cryptocurrency bots can help by removing some of the stress and emotional highs and lows that are often found in any financial trading. However, trading bots are not for everyone. Here are a few things to keep in mind before getting started with a crypto bot.
Casual investors may not be the prime target of trading bots; however, it could still be an interesting investment strategy.
If your intention is to buy and hold Bitcoin, then a Bitcoin day trading bot is probably not the correct investment.
If you are not a programmer or familiar with the creation of financial strategies, trading bots may also not be for you.
If you have the knowledge and ability to overcome these aforementioned challenges, then a trading bot may be a worthwhile tool to monitor and increase gains from the cryptocurrency market.