Trading bots are little pieces of software that will execute trades on an exchange on behalf of the trader. I remember looking at Fintech LTD test results the other day and wondering how it was possible for something that’s practically mindless to achieve such great results.
These things have been used before in regular financial markets by large hedge funds to trade equities, commodities and currencies. However, the use of such bots by the regular everyday investor first began in the foreign exchange (forex) industry. In time, they have also made their way into the cryptosphere.
What Crypto Trading Bots Are Out There?
Admittedly, the functionality of this trading bot is somewhat limited when you compare it to some of the other trading bots on this list. However, it is a good place to start for beginners as it has stripped all the extra stuff and left only the bare necessities. If you’re just starting out and want somewhere to test your different trading strategies, then Gekko should be a good idea for you.
You can backtest on the Cryptohopper trading bot, use trailing stops, trade across multiple exchanges and many other advantages. You can also use it for free in the first month and then start paying subscription thereafter. The cheapest plan costs only $19 while the most expensive one costs $99.
With HaasBot, you can use arbitraging strategies to take advantage of market inefficiencies across different exchanges easily. You can also protect your balance with the help of stops, among many other features. HaasBot is licensed, with prices ranging from 0.035 BTC to 0.084 BTC, which offers you a license for three months. Admittedly, HaasBot is one of the more expensive trading bots on this list and is recommended for the more experienced traders. However, it is worth every Satoshi.
The platform is subscription-based, and the monthly subscription ranges from 0.0013 BTC to 0.016 BTC. You can also pay the subscription fee in litecoin.
This crypto trading bot is fully open source. You can download it from GitHub. It is free, and anyone is allowed to modify the code on the bot to suit their trading style better. The bot is compatible with a wide range of assets and uses technical analysis as its basis for formulating strategies. It also supports high-frequency trading, backtesting and simulated trading or paper trading for traders to test their latest strategies using real-time market data.
ZenBot is a good option and can aid the more experienced traders who want to build something of their own that is capable of trading in their exact preferred style. However, the original developers still warn users not to use the bot with large amounts of money as there have been reports of losses by some users.
Beware the Risks
You face a range of potential pitfalls that you must do your best to avoid if you’re going to enjoy crypto trading bots. These include software not functioning as expected, scams and flash crashes, among others.
You should also remember that trading bots are tools, not little workers that generate a passive income for you while you do nothing yourself. Your trading bot is ultimately only as good as the strategy you feed it with. You should, therefore, take the time to hone your trading skills before you can introduce a trading bot into the picture. Ultimately, however, as long as you use them well, these little creatures can make you a tidy fortune.