All you need to know about Bitcoin Trading bots
Cryptocurrency market is a lot more volatile than the fiat investment market. It’s common to end your day with a lot of money to your name only to wake up and find that your assets aren’t worth half as much anymore. The volatility of the crypto market is something that all investors and traders tread carefully around. But since the market is open round the clock, traders have to be vigilant all the time. This is not possible manually, which is why trading bots are proving so popular in this field.
What are Trading Bots
Trading bots are software that interacts with the market and makes decisions on your behalf. These bots have their own pre-configured rules according to which they act. You can also set rules for your personal habits and needs. The idea behind using a bot is that even when you are away from your station, your bot can make sound crypto investment decisions on your behalf. Bots use different strategies to help their user get the best possible experience in trading. Using a bot enables you to be at the fore of cryptocurrency trading 24 hours a day.
There are a few strategies which bots use to boost the user’s asset values. The first is the arbitrage technique which uses the difference in the price of cryptocurrencies on different exchanges to help the user earn a profit. The bot buys altcoins on one exchange and sells them on the other, giving you a profit based on the difference. The second technique is market making, where the fluctuations in the buy and sell price in an exchange are utilized to make profits by constantly placing buy and sell orders near the limit. Both these strategies can help you make profits, but they aren’t as good as they used to be. The price difference of coins between exchanges used to be profitable for traders in the past, but that’s not the case anymore. The same can be said for market making. So the usefulness of your bot is heavily dependent on the techniques and strategies you use.
Keep Reading:
https://www.tokens24.com/cryptopedia/trading/all-you-need-know-bitcoin-trading-bots
I like bots as long as they are good bots behave themselves. Setting hundres of orders and causing traffic is not cool. So I propose using bots responsibly or not at all.