A crypto trading bot is a type of software to automate investment operations seeking benefits and speculating with digital assets. You can automate all of the steps of investment processes. You can set up simple actions like buying or selling assets. Or define the cost effectiveness or risk for your investment.
In this post we are going to explain the main features of a cryptocurrencies trading robot and how to start using them. The idea is for any investor in the crypto world to capitalize these software tools. Take a note and start learning about the world of automated crypto trading.
The user experience
You want to earn money by trading cryptocurrencies. You can grab a trading license through a bot by only registering yourself in the company that provides this service. Then you have to set some basic parameters for your bot:
- The risk you are willing to take.
- The amount of money you want to invest.
- Expected return.
- Preferred cryptocurrency.
- The time you are willing to wait for your expected return.
These parameters will alow the crypto trading bot to take autonomous decisions to reach the objectives. Usually, the best software is compatible with the main crypto trading platforms in the market.
Examples of crypto trading bot companies
- Bitsgap and Gumbot are of the most renowned and old in the market. It allows you to use pre-set strategies or customized ones.
- Bituniverse is a tool for 2 purposes. It allows you to manage your digital assets portfolio, as well as automate your trading process partially or totally.
- CryptoHopper is a crypto trading bot with a wide range of investment tools. You can set your buy or sell strategy or copy the ones from successful investors (Mirror Trade). It can also perform automate crypto arbitration operations.
The advantages of trading bots
- A crypto trading bot can operate 24 hours a day, 7 days a week. The crypto world never closes, so you can have presence in every moment.
- The decisions are not influenced by emotional elements. The bot only follows the parameters you set, reducing the possibility of mistakes.
- There are different kinds of bots, suitable for any user profile.
The risk of a crypto trading bot
- A crypto bot is not infallible. There are wide error ranges, and the tool is recommended for long term strategies, not short.
- Not all users can fully take advantage of the advanced modes, they are hard to set up.
- The crypto trading bots are exposed to scam and fraud operations.
Frauds and scams with crypto trading bots
Fraud in platforms of crypto trading is frequent. For that reason, we only must trade our crypto assets in trustworthy platforms. The criminals tend to create web platforms to attract little investors with high performance investments promises. The most common argument is that they have an algorithmic software to increase earnings. Do not enter these projects, ever.
The most usual scams are related to pyramidal schemes. At first, the investor receives the promised interest rates regularly. But the scheme only works by attracting new users. When the pyramid is at its peak, the fraud explodes and the platform disappears leaving only losses for the investor.
All around the world, there are several platforms facing the authorities for this type of crime. A crypto trading bot is can be exposed easily to these scams if we do not set it up carefully. In trustworthy platforms and with a good customization, the bots can fully achieve their objective. But trading is volatile, so the user has to be aware of the tendencies and practices of the crypto environment to avoid risks.