Do Cryptocurrency Trading Bots Really Work?
Time waits for no one, and the same can be said about investing, especially when it comes to cryptocurrencies. Unlike traditional stock markets, cryptocurrency markets never close, which can be a blessing or a curse. It all depends on your approach and goals.
After all, everyone needs to eat and sleep, among other things, each day. We can’t be glued to our computers 24 hours a day, 7 days a week, 365 days a year. Life is meant for living and investing is a means for living the life that you want. So how can you plug some of the gaps in your schedule during your downtime or protect your portfolio from volatile cryptocurrency value fluctuations?
Enter the World of Automated Crypto Trading
Cracking the code
From election rigging to Twitter trolls, bots have received a lot of bad press recently. But many of the things that people commonly refer to as ‘bots’ merely exhibit or mimic ‘bot-like’ behaviour. Neither good nor bad, a bot (short for ‘robot’) is simply a software programme that operates on the Internet and performs repetitive tasks more efficiently than humans.
In this respect, bots simulate human actions in which certain tasks are automated according to pre-defined criteria. In fact, ‘more than half of internet traffic is bots that interact with web pages, talk with users, scan for content and perform other tasks’.
Cryptocurrency trading bots operate under the same basic principle. They’re algorithmic computer programs that execute functions based on certain parameters established by investors. As a result, buying and selling become automated processes unbounded by our
sleeping and waking lives. You tell the crypto bot what to do and when to do it — no more missed trades or missed opportunities. By running a set of algorithms, investors can automatically buy, sell, or hold assets in a timely, efficient, and affordable manner day or night from anywhere in the world.
As with most things in life, though, the devil is in the details. Just as a one-size-fits-all strategy to investment will yield poor results, there is no one overarching crypto bot, but rather different types of bots fit for different purposes and these types fall under four main categories: trend-trading bots, arbitrage bots, coin-lending bots, and market-making bots.
Whilst we won’t take a deep dive into the differences in this introduction, a few remarks will help to distinguish between them. As their name suggests, trend-trading bots ‘attempt to capture gains through the analysis of an asset’s momentum in a particular direction track’.
Discerning trends can be useful when implementing take-profit or stop-loss provisions in order to capture profits or prevent losses. Arbitrage bots are used to identify inefficiencies and price differences across markets.
For those interested in lending cryptocurrencies at advantageous interest rates with limited risks, coin-lending bots automate the process and thereby mitigate volatile interest rates and loan repayments by borrowers. And market making bots turn a profit on the difference between the ask (selling price) and the bid (buying price), which is called the spread.
Levelling the Playing Field
Why should you care about automated trading bots? Two words: Wall Street. Many reports suggest that 80% of trading on the stock market is done via algorithmic-based automated programmes. Comparatively few individual investors, however, make use of algorithmic trading, partially due to the perceived complexity and costs.
Obviously, not everyone is an experienced coder or financial expert, and institutional investors have seemingly endless reserves of money, talent, and know-how. But crypto trading bots can level the playing field and even give savvy investors a leg up across crypto markets.
You’ll often read that 80% of private investors lose money due to a variety of factors. Trading volatile cryptocurrencies is emotional work and with emotions come errors in judgement. As much as 39% of manual trades are influenced by our emotional states, which can cause us to make irrational decisions. It’s simple human psychology.
Choose instead to be among the 20% of smart investors who make money. Crypto bots offer a non-emotional and systematic approach to trading. Think of them as roadmap or a GPS, ensuring that you
get to your investment endpoint or destination as safely and efficiently as possible. Trading detours based on fear or adrenaline can be costly, often leading to financial setbacks and losses. The point is not to overcome the human element, but to complement it by harnessing the power and potential of artificial intelligence and automation.
Levelling up with Trality
By now it should be clear that algorithmic trading offers a range of benefits for private investors. Given the overwhelming number of choices, though, selecting the right combination of bots can be a daunting task. As an investor, how does one go about finding safe, secure, and reliable crypto bots? As a creator, how does one build profitable bots in a streamlined manner and bring them to market?
The Answer in a Word: Trality
For creators, we offer the world’s first in-browser Python editor with debugger and end-to-end encryption; improved profitability through proprietary machine learning modules; and a unique connection to a large follower base via real marketplace.
Followers benefit from an app store for trading bots, which is rooted in a strong focus on curation and quality control. Trality offers unrivalled accessibility without the need for third party exchange accounts or API keys. Most importantly, we take a holistic portfolio approach for long-term trading success.
Upgrade Your Trading
To trade profitably, you need every help you can get. At Trality, we provide you with the tools you need to succeed, from bot creation to trade execution. Backtesting is at the heart of every bot creation iteration. That’s why we made it as fast as possible and provide debugging features that you won’t find anywhere else.
From improving your algorithms with in-browser backtesting and choosing individual time frames or automated scenario tests to using breakpoints or events when debugging and optimizing strategy parameters automatically, Trality has you covered.
Cloud-based live-trading
Trading bots should not miss a single trade and therefore need to run 24/7, which is why our rock-solid infrastructure is built for fast and reliable execution of your strategies. The many benefits include no setup and maintenance of your own servers; direct and reliable access to tickers and orderbooks; and access to your bots on web and mobile.
Your funds are safe and secure
The safety of your funds is paramount to us. We are committed to safeguarding your investments, which is why Trality never touches your funds directly. Bots merely send trading signals to your trusted exchange. Withdrawal-enabled API keys will always be rejected. All bots and algorithms are completely sandboxed and are stored encrypted.
Got code?
If you get hot and bothered by code, then check out our cloud-based Trality Code Editor — the most advanced code editor of its kind. Use your preferred language and libraries such as Python to code your algorithms. Additional benefits include accessing financial data with our easy-to-use API as well as access to a full range of TA indicators.
Bring your most advanced trading ideas to life using our growing list of tools and features. Edit in the browser with intelligent auto-complete. Backtest directly in the browser and benefit from clear versioning and your backtest history. Use in-browser debugging and automatic rebalancing.
Start your journey to profitable algorithmic trading with the Trality Rule Builder. Its graphical user interface lets you build your trading bot’s logic by simply dragging and dropping indicators and strategies.
Using the Trality Rule Builder, you can turn your ideas into a profitable strategy and optimize it until you’re satisfied. Build upon curated, pre defined trading strategies; select from over 100 technical indicators; use boolean logic to arrange strategy parts; and backtest your strategy with historical data.
The Best of Both Worlds
Located in the heart of Europe, Vienna-based Trality has enabled over 50 million private traders to boost their profits with algorithmic trading by attracting some of the smartest bot creators. We provide the highest level of flexibility and sophistication to creators, while followers can easily access world-beating bots, which would otherwise be reserved for the pros.
Enjoy video tutorials to learn more about algorithmic trading or make use of our detailed documentation. The key to our success and market leadership is our unique connection with both worlds: the best bot creation in the B2C space coupled with unique accessibility via the true marketplace.
Whether you’re a Python guru wanting to make the most of your quantitative skills and code sophisticated trading algorithms in order to boost returns, a casual trader looking for an entry into automated trading, hoping to increase returns while spending less time on manual trades, or simply someone interested in trying new things, improving existing skills, or testing out a trading idea in your head, Trality has a great deal to offer.
Ready to start? Whether you’re all set to take the plunge or still on the fence, don’t be a stranger. We encourage you to explore the range of offerings on our website.
Published at Wed, 18 Nov 2020 13:32:58 +0000