In this article, we will tell you about what are crypto trading bots and how they work including the 5 best crypto bots for 2022. A Crypto trading bot is software that helps you automate your crypto trading strategies. You have probably heard about them but still haven’t decided if you want to use a crypto bot for your cryptocurrency trading or not. It’s time to find out the truth about these bots and understand if they are worth investing in or not.
Cryptocurrencies are notoriously volatile, as their prices fluctuate dramatically within minutes. Additionally, cryptocurrency traders can trade at any time and anywhere around the world. Human cryptocurrency trading is limited in several ways as a result of these factors.
There are several reasons why investors cannot make the optimal trades they are theoretically capable of making when price changes. Further complicating this problem are the slowdowns in exchanges and long transaction times. Furthermore, investors simply cannot devote as much time to the cryptocurrency markets as necessary in order to consistently make the best trades. As a result, cryptocurrency exchanges around the world would need to be monitored round-the-clock.
It is fortunate for many investors that these issues can be resolved. Among the primary solutions to this problem are bots, or automated tools that execute trades for human investors. There are good reasons for using crypto bots and bad reasons for getting rid of them entirely, and bots are certainly a controversial part of the market.
- The cryptocurrency markets trade 24/7 around the world, so traders use bots to take advantage of them.
- Bots can react quicker than investors, which gives them an advantage over them.
- A bot, for instance, can automatically execute the best trade for an investor when they don’t have the time to devote to it.
- Arbitrage bots capitalize on price discrepancies between exchanges to make money.
Types of Crypto Trading Bots
A cryptocurrency bot can come in many forms. There is a type of bot called an arbitrage bot that is very popular. The purpose of arbitrage bots is to take advantage of discrepancies in prices across exchanges by making trades. Due to the fact that cryptocurrencies like Bitcoin often fluctuate in price between exchanges, bots that are able to move quickly can beat exchanges that struggle to keep up.
Traders can also use bots to test out trading strategies using historical price data. Alternatively, some crypto trading bots are programmed to execute trades in response to specific signals, such as price or trading volume.
How Crypto Bot Work
Cryptocurrency traders can benefit from bot programs, which are free to use. However, many crypto trading bots require users to pay fees, some of which are quite expensive. A developer usually offers the code for the bot or bots that will be most useful to investors. As far as software and hardware are concerned, each bot has its own requirements.
Cryptocurrency trading bots can be extremely helpful, although they remain controversial. An investor must, however, understand how to use bots effectively in order to maximize their impact. In order to invest in digital currencies, investors need to register for an account on multiple exchanges.
Cryptocurrency holdings must be stocked in those accounts. The time to buy or sell may still need to be factored into investment decisions in many cases. Investors who are unwilling to invest the time and effort needed to succeed will not benefit from crypto bots.
Even though bots can assist with ordering, they are not a replacement for solid investing principles.
Cryptocurrency Bot drawbacks
Several cryptocurrency bots provide marginal returns (even when they are functioning properly), which is one of the issues with cryptocurrency bots. The second problem is that many bots are simply not designed well.
Crypto bots are just as unregulated as cryptocurrencies themselves (or even more).
Lastly, and most importantly, bots are only effective if they are backed by an excellent investment program that comprehends the digital currency markets. For some cryptocurrency traders, a bot can be an invaluable tool. Those who have prepared themselves to use a bot effectively may find that they no longer need it after they’ve done the work to prepare themselves.
Comparison of Crypto Bot Trading Apps
| Trading bot | Features | Pricing | Our rating | Trial Period |
|---|---|---|---|---|
| Pionex | Trading Fees are reasonable, in-built trading bots are free, and the risk is low. | A small trading fee of 0.05% applies. | 5/5 | — |
| eToro | Stocks, ETFs, and cryptos can be invested in using fiat currency. | Free | 5/5 | — |
| NAGA | A bank account, debit/credit cards, and online methods (Skrill, SoFort, Neteller, Giropay, EPS, Ideal, P24, and crypto) can be used to deposit or withdraw money. Up to 1,000x leverage can be achieved. | 0.1 pips spread, 3-month inactivity fee, deposit, and other charges apply. | 5/5 | Unlimited demo account. |
| CoinRule | MACD, Bollinger Bands, RSI (Relative Strength Index), and other indicators. Mobile support. | $30/month for the hobbyist version; $60/month for trader level; and $450/month for the pro package. | 4.7/5 | Unlimited for basic accounts. |
| CryptoHopper | The trading tools include a bot backtesting tool, templates that can be customized and saved, trailing stops, and technical indicators that can be customized | Free trial, and as per plan — $19, $49, and $99 per month. | 5/5 | 30 days. |
5 Best Crypto Trading Bots for 2022
Crypto trading bots do more than just trade crypto – they can collect big data crypto market information in real-time using APIs since they use artificial intelligence, machine learning, and other smart technologies. After analyzing this information, traders derive useful and actionable metrics or conclusions called trading signals by applying predefined trading strategies.
There are several sources of information that are used by the best crypto trading bots, including social media, news sites, crypto market makers, and many others. This is why they employ artificial intelligence and machine learning to determine what news is making a social impact and is likely to influence the market in a big way.
It is possible to buy trading bots separately or integrate them into crypto exchanges.
Despite the fact that they cost millions of dollars, there is no perfect crypto trading bot. Losses are still made, even though the goal is to limit them. Additionally, the best crypto trading bots are used in conjunction with human intervention.
You can automate your Crypto trading strategies to amplify profits by comparing, comparing, and choosing from the following list of the 5 best Crypto Trading Bots:
1. Pionex – Recommended
A key reason Pionex makes this list is its 16 free in-built trading bots. Using Pionex’s bots, you can make money by trading cryptocurrency on your behalf for a small fee of 0.05%. In addition to its Grid Trading Bot, some of its most popular bots include the Selling High and Buying Low Bot. In contrast, the arbitrage bot leverages the futures market powered by Binance in order to give you an eight-hour payout.
Price: You will be charged a small fee of 0.05% for each trade.
Features:
- For makers and takers, there is a reasonable trading fee of 0.05%.
- There are 16 free trading bots built into the software.
- The Spot-Futures Arbitrage bot allows you to earn 15-50% APR with low risk.
- You can buy low and sell high in the price range by using a grid trading bot.
- Up to 5x leverage is provided by the Leveraged Grid Bot.
- Using DCA buys and one-time sells, the Martingale bot captures the profit from fluctuation.
- By using a rebalancing bot, you can hold on to your coins longer.
- Using a dollar-cost averaging algorithm (DCA), repeated purchases over time are made to offset the effects of volatility.
2. eToro
Trading sentiments and insights from other crypto traders can be copied on eToro’s copy trading platform. A free or paid arrangement is available for the following crypto traders. By viewing the following users’ feeds, you can see their portfolios, profits, and other information.
The eToro platform does not have a dedicated bot program nor does it allow users to trade using robots. Both retail and institutional traders have access to eToroX, eToro’s crypto trading platform.
Price: Free
Features:
- Copy the strategies of traders and follow them.
- Over 20 cryptos are available for trading.
- One of the world’s largest social investing platforms lets you learn from millions of investors worldwide
- Sign up now and get $10 extra when you invest $100.
3. NAGA
One of the best crypto trading platforms is NAGA because it allows you to automate copy trading so that you can follow experts. You can do this after making a $250 deposit.
Traders that don’t have trading experience or bot development skills can also benefit from Naga copy trading bot’s fixed returns. By auto copying traders whose strategies offer predictable or fixed returns, this can be accomplished.
Additionally, it has an integrated wallet that enables users to deposit, receive, withdraw, send, and hold cryptocurrency. Cryptocurrencies can also be exchanged for each other during trading. Over 40 cryptocurrencies support all these features, including auto copy trading.
Price: Spreads as low as 0.1 pips. There is a $5 withdrawal fee. There is a $20 fee for three months of inactivity.
Features:
- The site accepts deposits from banks, credit cards, Skrill, Neteller, and Giropay, as well as Bitcoin Cash, Bitcoin, Litecoin, Dash, Ethereum, and Naga coin.
- The securities exchange commission of Cyprus regulates the company.
- Many countries, including the US, Australia, and Canada, do not offer this service.
- An Android app will be available along with the web app for the NAGA platform.
- Auto copy trading can be unlocked with a $250 minimum deposit on NAGA.
- Trades can be copied from hundreds of users.
- Over 90 financial instruments are available to trade, including cryptos, stocks, ETFs, and CFDs.
- To reduce transaction fees, use NAGA debit cards or NAGA coins. In addition to reducing fees by 50%, NAGA debit cards also reduce fees by 100%.
- There is maximum leverage of 1000 times available when trading.
4. CoinRule
CoinRule was founded in 2017 and is operated by a team in the United Kingdom. Many cryptocurrency exchanges support the bot, including Binance, Huobi, Bitfinex, OKEx, and HitBTC. You do not have to pay any fees to trade on it. More than 7,000 trading strategies can be created with it, allowing you to use multiple rules-based trading strategies.
The application does not support Technical Analysis (TA), but it allows users to share trading strategies and tips using TradingView. Multiple cryptocurrencies can be traded with it.
Price: The starter plan costs nothing, but it has limited features. For hobbyists, the monthly fee is $30 and the annual fee is $359. The Trader package is $60/month and annually costs $719, while the Pro package is $450/month and annually costs $5399.
Features:
- There are many indicators to use, including MACD, Bollinger Bands, RSI, and others.
- There are a variety of ways to receive support, including emails, live telegram chats, webinars, and other methods.
- The pro version includes trading templates.
- The web interface is also available on Android and iOS devices.
5. CryptoHopper
With CryptoHopper, users can use external signals to make intelligent trades using an algorithmic trading approach based on a cloud-based platform. In addition to Coinbase, OKEX, KuCoin, Binance, Kraken, Huobi, and others, users can connect with 9 different cryptocurrency exchanges.
This tool allows you to leverage signals from different sources, both free and paid. In addition to using over 30 trading indicators and 90 candle patterns, it is owned and operated from Amsterdam, Netherlands. It works 24 hours a day, 7 days a week, and trades multiple cryptocurrencies in addition to Bitcoin (75 in particular).
Price: Trial offers are available, and plans start at $49 and go up to $99 per month
Features:
- Indicators such as Stochastics, RSI, Bollinger Bands, and many more.
- Tools for backtesting bots, configuring and saving templates, trailing stops, and customizing technical indicators are among the tools included in the trading software.
- No desktop or mobile apps – web-based only.
Frequently Asked Questions
How effective are crypto trading bots?
In most cases, but not all. In order to make money with crypto bot trading, the bots must make predictions, automate order placement, and execute orders using technology.
Ideally, it is more profitable to trade crypto with a bot than to hold the coins for the entire period. In addition to how they are set up and how well you configure them, profitability depends on your expertise.
Do cryptocurrency trading bots make a profit?
Trading bots are profitable when configured properly. It is essential to try the best crypto trading bots or have some kind of guarantee before buying them to make sure they will make you a profit. Learning how they work is essential. Losses can also be incurred otherwise.
Is trading with bots legal?
Trading crypto with bots is legal, as well as using bots. In the stock and forex markets, trading bots have been tested and proven to be effective. There are, however, some brokers that do not allow bots to be used – including crypto trading brokers.
Do I need to use a crypto trading bot?
It is recommended to use bots to trade crypto in order to increase trading efficiency and profitability. As well as eliminating human error, it also improves the speed of trading.
Crypto trading bots can make profits even from the smallest price changes, thanks to their ability to take advantage of crypto volatility. By using them, you can stay on top of markets and track them efficiently.
What is the method by which crypto trading bots make money?
Big data in marketing is basically used to derive trading signals and insights. Multiple sources are consulted for unclassified/random/disorganized and Adhoc information. The information could be current or historical.
Data and information are classified according to historical market patterns based on predefined and coded trading strategies after they have been received to generate useful and actionable trading signals.
Within seconds, trading bots analyze the information and can handle rapid price changes in volatile markets. To place sell and buy orders on crypto trading exchanges, crypto trading bots are either integrated with them or use APIs. Following that, the orders will be executed normally. Their software eliminates manual work and voluminous paperwork and makes trading easier.
Traders use indicators to identify signals and trends in the market based on mathematical patterns plotted on price charts. These patterns are charted by bots, which deduce the signals automatically.
There are several indicators included in the analysis: Moving averages, exponential moving averages, relative strength index, Fibonacci retracement, Ichimoku cloud, standard deviation, and average directional index.
What is the expected return on a beginner day trader in crypto?
You can make $163,000 by using a good stock day trading strategy with 4:1 leverage annually. At the top of the crypto industry, day traders earn around $78 an hour, but on average, this could be around $45.
Conclusion
Crypto trading bots should be chosen based on their beneficial features when searching for the best one. It must be less expensive, support backtesting of automated trading strategies, and accommodate multiple indicators and trading strategies. Wouldn’t it be nice if you could trade on your mobile device with a bot?
The purpose of this tutorial is to answer the question of whether crypto trading bots work and to recommend the best, most efficient, and most profitable ones. Trading bots are the most effective when you can try them out before committing to a paid subscription or if you can use them for free before upgrading. By doing this, you can determine whether they work or not.
We hope now you know everything about crypto trading bots and choose the best one for you from the list above.
