The Future of Crypto Trading Bots

Bots have considerably evolved during recent years as algorithmic trading is booming. Source of image: Visual Hunt.

As Bitcoin (BTC) and all cryptocurrencies are going mainstream, many financial gurus claim they found the best trading system that ever existed. Even though some of these so-called experts actually know how to beat the market, most of their apprentices cannot spend many hours per day waiting for a particular technical setup to form on a chart. However, many traders are now using trading bots to automate their strategy. Find out why.

Why Using a Trading Bot?

Bots have considerably evolved during recent years as algorithmic trading is booming. Source of image: Visual Hunt.

Digital currencies, just like any other asset classes, are subject to market cycles. Even though it can be relatively easy to realize a profit when all participants are experiencing the Fear of Missing Out (FOMO), it can be much harder when the market is going down or sideways. If you are new to the scene, you will likely blow your account if you start trading in such conditions.

Nonetheless, there is a solution to that problem: Crypto Trading Bots can be very powerful if you want to profit from the market’s volatility while not having a lot of experience. According to CryptoCoinTrade when talking about Crypto Trading Bots, “the aim of the cryptocurrency trading software is to provide its user with a profitable business even when sleeping.”

Basically, the user has to predetermine what market conditions will lead the trading bot to either sell or buy. For example, a very simplistic approach could be to program the software, so it buys bitcoins every time the one-hour RSI goes below 30 and sell bitcoins every time the one-hour RSI goes above 70.

What Are the Best Bots?

Although any bot has its pros and cons, some products are superior to others. If we stick to the reliability, security, profitability, transparency, and user-friendliness, here are the three best bots currently available on the market.

  1. Cryptohopper. This trading bot is relatively new, but it does beat all the other ones we tested. Cryptohopper embeds external signalers, which allows beginners to literally put the bot on auto-pilot mode and rely strictly on these signals. Nonetheless, seasoned traders can set the parameters manually if they prefer to act upon different market conditions. Finally, this bot utilizes cloud technology to run, which means that it does not need a computer to run 24/7 to execute trades. Price ranges between $19 and $99 per month.
  1. Hassonline.Created in 2014, Hassonline has survived a few boom and bust cycles, which makes it more reliable than most competitors. It is supported on many exchanges, such as Poloniex, BitMEX, Bitfinex, Gemini, Kraken, and GDAX. One feature is worth mentioning: it can analyze trend patterns to predict possible future price action. Bear in mind that Hassonline is intended for experienced traders because it requires the user to provide some inputs. Its price ranges from 0.028 BTC to 0.127 BTC.
Traders can choose among 32 different pre-configured strategies thank to Gunbot. Source of image: Facebook.
  1. Gunbot.Definitely one the most popular trading software, Gunbot can count one more than 6,000 active users. Allegedly, the strategy relying on Bollinger bands is the most effective. Gunbot’s price ranges between 0.1 BTC and 0.59 BTC depending on the level of sophistication you are looking for.

Where Are We Heading?

 In the crypto-sphere, algorithmic trading is becoming very popular but is now somewhat limited to shorter time frames. This situation is likely going to change in the near future. As the crypto-market is getting more mature, bots will likely follow a similar evolution to what we saw in the stock market and will take trades-based on one-minute charts as well as monthly charts.

Some algorithms have the capacity to wait for years before they reach their target. Source of image: Pexels.

Moreover, it is relevant to point out that most bots currently rely on technical indicators rather than price action. As most indicators are lagging the market, they provide confirmation that something already happened instead of giving insights about the future. Unfortunately, this can easily lead to underperformance. Also, while calculations capabilities of computers are improving every year, trading bots will likely have more facility to recognize subjective concepts such as breakouts, supports, resistance, chart patterns, and even Elliott Waves.

Conclusion

Even though crypto-bots will most likely get more effective in the future, some of them are still good enough to gather the attention of the trading community. While Cryptohopper, Hassonline, and Gunbot are the three bots that made it to our top three, there are other platforms that can help you to extract profit from the crypto-market. As we approach a new decade, we should witness the rise of automation, especially in the financial sector. Therefore, it is not a bad idea to get ahead and to familiarize yourself with trading bots.

Disclaimer: The information on this site is provided for discussion purposes only, and should not be misconstrued as investment advice. Under no circumstances does this information represent a recommendation to buy or sell securities.

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