In this guide, we have identified the top three most popular crypto trading bots for automated trading, as well as some background and suggestions on how to use them.
In its most basic form, trading is purchasing an asset at a low price and selling it at a higher price. However, trading has evolved to the point that it is no longer just a question of purchasing low and selling high.
Consider the practice of margin trading, for instance. When traders use asset derivatives like futures, they are betting on the underlying asset price rising or falling. Trading has grown increasingly complex, and derivatives are only one illustration of how the premise of trading has changed.
Nowadays, trading bots have become an important tool for experienced traders in a market packed with hundreds of assets, some of which have many derivatives and very high price volatility.
Why people use crypto trading bots
Essentially, computer programs that generate and submit buy and sell orders to cryptocurrency exchanges following the rules of a pre-defined trading strategy are known as crypto trading bots. For instance, when the price of Bitcoin (BTC) crosses a particular level, a very basic trading bot may be designed to sell BTC.
Some of the benefits of using crypto trading bots are as follows:
- Allow traders to make trades based on facts and trends rather than hunches or emotions,
- Increase earnings;
- Reduce risks and losses are limited by using this strategy;
- Generate passive revenue at any time of the day or night;
- Whether you’re sleeping, playing sports, or at the office, you might be making money from automatic transactions while you’re doing something else.
Please note: Trading software aids in the automation of implementing trading strategies, while the trader is still responsible for doing research and conducting analysis. To know more about how to choose the right automated software for your trades be sure to read our Choosing the Best Crypto Trading Bot guide.
Using trading bots on Binance and Coinbase Pro
Coinbase cryptocurrency exchange prioritizes security and simplicity above everything else. The platform facilitates the buying and selling of cryptocurrencies while providing consumers with great security and transparency.
By the same token, its Coinbase Pro platform is more advanced and enables customers to employ trading bots to improve their trades on top of offering several API affixing techniques to the speculator engine.
Instead of being glued to a computer all day, traders may increase the value of their portfolio by enhancing their trading abilities and using trading bot technology to get an advantage.
Binance provides advanced charting tools with complicated indicators and overlays. However, it is very risky to leave an order hanging on Binance while you are not present due to the high volatility. Thus, trading bots are the best option since they can automatically generate an infinite number of orders and execute them immediately.
By processing an infinite number of orders quickly, minimizing human error, and eliminating emotion, resulting in increased profit, trading bots enable users to utilize techniques they couldn’t use manually. Trading bots may also monitor several cryptocurrencies at once, with over 500 coins and transaction types to select on Binance; it is an advantage.
Best Crypto Trading Bots
Coinrule has been in operation since 2018 and is by far the most advanced and simple to use crypto trading bot. It enables its users to build trading strategies (rules) that monitor the market for trading opportunities and execute them fully automated.
According to its co-founders Gabriele Musella (CEO) and Oleg Giberstein (COO), Coinrule aims to democratize trading by providing professional-grade tools to both experts and novices.
The co-founder of Coinrule, Musella, said in an exclusive interview with Finbold that the company’s goal is to provide “beginners access to advanced trading tools in a fun, simple, and educational interface.” Therefore, the platform is intended to function as a “Lego tool-box” for developing trading strategies, putting them into action, and monitoring their success in real-time while using an interface that is straightforward to use.
Additionally, since its inception, Coinrule has maintained a clear four-tier membership plan, including a free option to assist new users in getting up and running.
Concerning registration, the business is registered in the United Kingdom and its headquarters are located in London. The bot’s servers, on the other hand, are located in Europe.
Watch the video: What is Coinrule?
How Coinrule Trading bots work
Trading bots are programs that enable the execution of trading instructions on an exchange account on the user’s behalf. They can accomplish this by using the API (application programming interface) provided by an exchange.
The most basic definition of an API is that it serves as a connection point between two or more computer-based interfaces (in this instance, web apps), enabling them to interact with one another and execute the user’s instructions.
Consider the case of Binance, one of the most active cryptocurrency trading platforms in terms of daily traded volume. Binance provides its users with access to an API.
Users may conduct transactions and withdraw their money without logging onto their Binance accounts by using the API provided by the exchange. Coinrule, as an example trading bot, would approach the client and ask for permission to make such trades on their behalf.
In contrast to the majority of automated trading systems on the market, Coinrule makes use of conditional statements based on the IFTTT model. IFTTT (If This Then That) is a paradigm that enables users to provide a series of actions that should be carried out if a specific condition is fulfilled.
For instance, Coinrule gives its customers the ability to define circumstances that will cause an action to be taken on their trading accounts. If the stated condition is fulfilled, the Coinrule bot will continue to carry out a predefined action. The opposite is also true – if the condition is not fulfilled, the bot will not execute the action.
Coinrule security & features
Despite the fact that it has only been in operation for a short period, the crypto trading bot service already provides a plethora of features that are on par with, if not better than, those offered by most other established competitors.
Due to the site’s simple appearance, it may not be immediately apparent that Coinrule has managed to pack a significant amount of functionality into its service. The following are some of the noteworthy characteristics:
Secure login and authentication – Coinrule utilizes Ukey1’s secure login service to store and verify user login information. UKey1 hashes passwords and encrypts personal data using sophisticated security methods.
DDoS-proof- Attackers that employ an army of hijacked computers to overload a targeted website’s servers with resource requests are known as DDoS (distributed denial-of-service) attackers. This frequently causes a website to go down. A partnership with Cloudflare’s (CDN) service has been formed to mitigate the risk of such an attack occurring.
Management of API keys – Coinrule does not support API keys with withdrawal authorization activated. API and secret keys are protected using 256-bit AES and TLS 1.2 (and higher) encryption standards.
Payment processing – additional care is taken while processing clients’ package subscriptions. The service accepts payments through Stripe rather than directly. To avoid collecting personally identifying information from customers, Stripe marks transactions as Merchant-Initiated Transactions (MITs).
Interface and user experience
Aside from security, the user interface is another area where Coinrule excels. It has one of the most user-friendly user interfaces of any automated trading system. As soon as a user logs into the online interface, they are presented with the most important components of the crypto trading bot service.
Three main options may be accessed via the left-hand navigation when signed in:
Rules – When you first log in to the service, this is the page that appears. You will be able to see all of the IFTTT rules that you have set to automate your trading activity in this section. As well as the performance of each rule, you will be able to stop or unpause rules as needed;
Exchanges – Your Coinrule account balances, as well as the balances of your exchange accounts, are shown on this page. You may also add other accounts in this section;
Settings – This page provides access to preferences that have been specified by the user.
To enable users to try out their rules before putting them into live real money trading, Coinrule offers an easy-to-use ‘paper trading’ platform. It makes use of real-time data from the Binance paper trading interface, which supports all of the trade pairs that are offered on the exchange.
The Binance paper-trading platform is accessible to Coinrule users via a more user-friendly automated trading interface, as a result of this integration. Each new account is initially credited with 10 BTC and 100 ETH coins.
Utilizing a demo exchange enables users to experiment with different trading strategies (rules). Likewise, if it produces the desired result, the user may then utilize it in real trading to make money.
In this regard, it should be noted that Coinrule does not directly enable backtesting on the platform. Essentially, this implies that the sample account is running on real-time price action data supplied by Binance itself.
As a result, time and patience will be required in order to determine the effectiveness of a strategy.
Watch the video: Paper trading on the demo exchange
The supply of trading tools, like technical indicators, is something that every trader uses, but it is not yet accessible on Coinrule. Because of this, traders must rely on third-party services, such as Tradingview, to perform technical analysis (TA).
Trade ideas and tactics are shared on Coinrule’s Tradingview profile, which promotes the usage of Tradingview.
It distributes different scripts from time to time, which may be implemented straight to the market via backtesting on Tradingview, which is free to use. Once a script has been successfully tested, it may be converted into a rule and deployed on Coinrule.
Connect an exchange account
Note: Following the completion of the registration process (see ‘Sign up‘ part in our Coinrule review), the following step is to connect an exchange account. Check out our guide to the five most trusted cryptocurrency exchanges to determine which one is the best match for you. Interestingly, Coinrule offers support for three of the five trading platforms we reviewed in that guide. Binance, Coinbase Pro, and Kraken are the three exchanges in question.
The Knowledge Base part of the website has a wealth of information on anything from creating rules and trading strategies to using the demo exchange.
You may also subscribe to news feeds and trading tips and techniques through the blog as well as follow Coinrule on Facebook, Telegram, and Twitter.
Pricing and packages
Coinrule provides its clients with a choice of four subscription options including : Starter, Hobbyist, Trader, and Professional. Moreover, when trading instructions are sent to exchanges via the service, there are no transaction fees charged.
Starter package – this is the cheapest plan for new users. The bundle is free but only connects to one exchange. A maximum of two rules may be active at the same time, and no more than $3,000 in volume can be traded each month.
Hobbyist package – $29.99/month ($359/year). It includes one additional exchange connection than the Starter package, seven simultaneous demo and live rules, 40 template strategies, and trading volume up to $300,000 per month. Subscribers also receive access to the trading community and live customer assistance through Telegram and email.
Trader package – $59.99/month ($719/year). Includes 3 exchange connections, 15 live and demo rules, limitless template strategies, and a $3 million trading volume. This plan also includes free access to the trader community, one-on-one training sessions with the Coinrule team, Telegram live support and advanced indicators and operators.
The Pro package – $449.99/month (billed annually at $5,399). Unlimited exchange connections and template strategies; 50 live and demo rules; an unlimited weekly trading volume. A dedicated server, one-on-one training, lightning-fast execution, and leverage techniques are all included.
Pros and Cons of using Coinrule
- No coding required;
- Connect multiple exchanges;
- Trade with 14 rules simultaneously;
- Access 150+ template strategies;
- Enjoy tens of video tutorials and ease of use.
- No mobile trading app;
- No backtesting of the strategies.
Coinrule, one of the most technologically sophisticated and reliable tools available on the market, is an automated cryptocurrency trading platform that allows users to compete with experienced algorithmic traders and hedge fund managers. Users may sign up for a free account and begin utilizing the platform’s trading features in a couple of minutes.
If you want to learn more about how to set up an account and a trading bot on Coinrule, as well as about the other choices accessible while using the trading bot, we suggest that you read our in-depth guide.
TradeSanta is a cloud-based software platform that allows users to automate trading methods across a variety of cryptocurrency exchange platforms. It was first released in 2018, but it wasn’t until 2019 that it began to gain momentum in the cryptocurrency space.
People who don’t have the time to manually submit each trade may benefit from services like TradeSanta. Its crypto trading bot conducts trades for you by following the preferred parameters you provide on TradeSanta’s platform, available on most large centralized crypto exchanges it supports.
In addition to increasing the scope of your trade, you may build as many independent trading bots as you wish. Each bot implements a single strategy that has been programmed into a cryptocurrency exchange of the user’s choosing by trading a predetermined currency pair.
In summary, TradeSanta removes the need to manually execute transactions by automating the process.
Watch this video: Explaining TradeSanta
There are two basic bot templates to select from (long and short), as well as a third option that allows you to completely personalize your trading bot.
The long strategy is purchasing cryptocurrencies with the hope that the price will rise in the future. When the price rises, the bot is able to benefit from the difference between the two prices.
In contrast, the short strategy is selling with the anticipation that the price of cryptocurrencies will fall. The bot may then repurchase them, completing the trade by holding the same quantity of crypto in inventory and the profit generated from the difference.
As an alternative, it is feasible to create two or more distinct automatic trading bots, each of which runs both long and short strategies simultaneously. No matter which way the market turns, the bots are ready to seize the moment.
You’ll need to connect the bot to a specific exchange and pick a pair to trade from among those available on that exchange before you can begin trading.
After that, choose either a long or a short plan from the templates and make the necessary adjustments (percentage of profit to take from the trade, filter signals, etc.). The bot may be activated after all of the settings have been customized to your liking.
Watch this video: TradeSanta Bot’s Page Explained
Bots use technical indicators to decide when they should enter the market at the optimum time. Examples of such indicators are:
Day Filter: actions are performed in accordance with the candle indication from the day before and whether it was bullish or bearish. Consequently, if the bot is programmed to trade long and the previous day’s trading was bullish, the bot will continue to open the position. Conversely, to initiate a trade if the bot is optimized for a short strategy, the prior day candle must have been bearish in order for it to do so.
The Volume Filter: Is used to determine if the trading volume of a token pair over the last 24 hours is deemed adequate.
Bollinger Signal: Using the Bollinger bands of a trading pair over the last 1.5 hours on a 5-minute time frame, the bot will seek the best entry opportunity.
In order to configure the behavior of their bots, TradeSanta users may select between the three signals or utilize all three at the same time.
- Real-time tracking – with clear statistics and telegram alerts, you can keep track of the trading bot’s activity from anywhere.
- Large volume trading – Buy huge quantities of cryptocurrency without causing the price to surge or plummet.
- Take profit targets – Set your desired profit and then sit back and wait for the bot to monitor the market and complete the transaction at the appropriate time.
TradeSanta is capable of operating on the following exchanges:
- Coinbase Pro
Basic Plan ($14 USD / month)(when purchased annually): There may be up to 49 bots and there is no restriction to the amount of trade volume. The number of pairings is unlimited, all strategies and Telegram-notifications and general support.
Advanced – $20 month (when purchased annually): You may have up to 99 bots as well as trailing Profit from your investment. Unlimited trade volume and number of pairings. All strategies, Telegram alerts and TradingView signals for Binance, Coinbase Pro, Huobi, and HitBTC. On top of new statistics features.
Maximum _ $30 / month (when purchased annually): Allows an unlimited number of bots
TradingView signals for Binance, Coinbase Pro, Huobi and HitBTC. There are custom TradingView signals. Trailing Take Profit, unlimited trading volume and unlimited number of pairs. On top of Binance Futures, Telegram-notifications and new statistics.
Note: All new customers will be able to take advantage of a 3-day FREE trial of the Maximum plan. TradeSanta accepts payments in Bitcoin, Ethereum, and USD Tether.
Built by TradeSanta, their virtual trader is a sandbox trading environment where you may make errors. In order to acquire a feel for the parameters, it is a good idea to try your ideas here before putting real money on the line.
TradeSanta provides you a lot of leeway to make mistakes. It is important to keep track of which bots are effective since there are almost endless options for how a bot may be built.
Pros and cons of using TradeSanta
- Solid trading bot platform for beginners;
- You may use a virtual bot to observe how it all works without putting your real money at risk;
- The trading experience is completely automated;
- A streamlined approach to creating a bot with indications and settings specific to you;
- Easy-to-use dashboard for keeping tabs on performance, making changes, and keeping track of your portfolio;
- A number of preset trading strategies.
- The free trial period is just three days long;
- Lacks support for some of the major high liquidity exchanges such as Kraken, KuCoin, Gemini, etc;
- Not suitable for taking advantage of arbitrage opportunities;
- Lacks support for any decentralized exchanges;
- Not the best option for beginners;
- Not open source.
Even though trading bot sites have been around for a while, Trade Santa has done something special in the online trading industry. With 568 active trading bots and over 118,400 active users, they’re still among the best crypto trading bots.
In order to democratize algorithmic trading, Hummingbot is a community-driven open-source initiative that seeks to make advanced high-frequency trading techniques freely accessible to anybody on the globe.
This experimental program was developed to assist cryptocurrency exchanges in developing and operating high-frequency trading bots to increase the number of their clients in the process.
However, Hummingbot is also helpful for exchanges and traders, developers, and token issuers, among other things. This guide will focus on traders and its open-source trading engine that enables the execution of automated algorithmic trading techniques (also known as bots) on both controlled and decentralized exchanges.
This project already has over 20 connectors to centralized and decentralized exchanges, including well-known names like Coinbase, Binance, and Kraken, among others.
It is a community of professional traders and developers with over 15,695 people discussing Hummingbot on its Discord page.
Due to its ability to attract traders from more well-known centralized exchanges, Hummingbot is a valuable bot for smaller exchanges. This project allows any DEX to have the same liquidity as another since market makers will be able to profit on the gap between bid and ask prices at any moment.
Furthermore, Hummingbot has evolved into a trading engine that executes transactions based on the criteria given by users, thus removing some of the technical difficulties associated with trading with controlled and decentralized exchanges.
The platform will also help with the implementation of trades and contact with other exchanges by completing various actions, such as:
- Submission of trading instructions;
- Retrieval of prices and orders from the order book;
- Handling of asset transfers for various tasks.
Hummingbot’s open-source nature may be explained by its goal to establish trust and openness in the community. In particular, code must always be accessible for audit and inspection, or else users will withhold their private keys, and exchanges will refuse to share their API keys with a bot.
Whatsmore, as an open-source application, there is one additional advantage: it is completely free to use. Easy to set up and use, on top of letting consumers make markets across multiple exchanges.
The Hummingbot ecosystem, as described on the official website, is made up of algorithmic traders and developers who use and contribute to the open-source bot codebase. Nonetheless, there are a number of other important components of this ecosystem.
Market-making is defined as the continual flow of offers to buy and sell assets in the open market. Installation, setup, and usage of the Humming bot’s instructions are straightforward for anybody who wants to make use of the bot, which is compatible with the vast majority of commonly used operating systems.
If you solely want to concentrate on market making with liquidity benefits, Hummingbot is a solid option since it is completely free and offers plenty of market making parameters and scripts.
General Hummingbot features are as follows:
- Price – Hummingbot is completely free to providing that you run it on a local machine. You can operate the Humminingbot on a cloud server, which will incur an additional cost of US$5-10 per month on average for one bot.
- Instances – Unlimited.
- Platform – Windows/Mac/Linux.
- Paper trading – You can test Hummingbot through and practice trading strategies without putting any real money at risk.
- TradingView integration – Users may manage their bots via telegram messages by using the telegraph functionality of Hummingbot’s software. In addition, the webhook functionality of TradingView enables notifications to be delivered to other platforms from the platform.
- Scripts & Strategies – There are 8 strategies available, as well as scripts.
Functional bot features:
- Performance History – displays the duration of all previous transactions, the assets inventory and value, as well as the performance of the market trading pair.
- Minimum Order Size – the amount specified by a bot for pure or cross-exchange market making.
- Balance Limits – the maximum and minimum amounts of assets that may be utilized by the bot in the wallet or exchange are specified.
- Kill Switch – a feature that allows the bot to be stopped when it achieves a particular level of performance.
- Telegram compatibility – install Telegram on all of your devices to get real-time updates and to send instructions to your trading bot from any device that has Telegram installed.
Watch the video:What is Market Making? | Hummingbot Crypto Trading Basics
Using custom scripts or by coding your own strategy, Hummingbot enables you to make any approach uniquely yours. Hummingbot, on the other hand, has foreseen that users may have difficulties while creating their first custom scripts and has prepared a repository containing a collection of ready-to-use scripts for your convenience.
You may learn more about the Hummingbot’s custom scripts library by visiting the following repo.
Watch the video: How to set up a simple pure market making bot on Binance
There is a unique Hummingbot Academy where you can learn all you need to know about the project and how to be successful in it. In addition to providing information on the installation process and bot setup, the Academy also provides a range of start guides, FAQs, video tutorials, and case studies. Using the search engine, users may enter their query and locate the information they need.
Pre-built strategy templates
In Hummingbot, there are four pre-built strategy templates that may be used:
Market making – Hummingbot places bids and asks orders on the market and then waits for other market participants to fulfil their orders.
Arbitrage – It enables for the simultaneous monitoring of two separate markets, as well as the risk-free capture of market gains when it buys high and sells low when new trading opportunities arise.
Cross-exchange market mining – This approach is a combination of two prior strategies. Hummingbot creates markets on smaller, less liquid exchanges and executes the inverse, back-to-back transaction for any filled trades on a larger, more liquid exchange.
Celo arbitrage – This is a mix of market making and arbitrage, with market making on one exchange while hedging any orders completed on another exchange.
Pros and cons of using Hummingbot
In addition to traders, Hummingbot may be helpful to developers, token issuers, and exchanges, to name a few industries.
A highly configurable tool allows traders to get started mining and earning money right away. They will have greater control over the script’s features and codebase and will not have to worry about the technical intricacies handled by the script’s development team.
In contrast, developers may put their skills to use and contribute to the open-source project by using their expertise. They may contribute to the development of trading strategies, scripts, and exchange integrations, as well as learn more about high-frequency, algorithmic trading and share expertise with the project’s larger community of participants.
Lastly, traders and developers may collaborate to improve the service by adding liquidity mining capabilities, developing a new strong trading tool, and benefiting from the active community of traders and developers.
- Open source and free;
- Supports over 20 exchanges;
- Minimal hardware requirements;
- Multi-OS support;
- Growing community on Discord.
- Complicated for beginners to start off but it does have an academy;
- Requires an understanding of certain trade concepts.
Hummingbot is a cutting-edge trading engine that enables you to make money by operating a bot on several exchanges across the world. To do this, the market-making bot employs a proprietary liquidity mining algorithm that employs four distinct methods.
What distinguishes Hummingbot from the competition is its one-of-a-kind ability to assist not just traders, but also exchanges, developers, and token issuers as well as being free.
FAQs about crypto trading bots
Does a trading bot automate buying and selling crypto?
Yes, if you want to utilize an automated cryptocurrency trading platform, you must first create an online account with a trading bot and then choose a trading strategy to employ. Following your selection of an automatic trading bot, the software will purchase and sell your crypto for you according to the settings you choose.
Are bots effective crypto trading tools?
For traders, the employment of bots allows them to profit from 24-hour crypto markets. Since investing takes time, most people don’t have the time or resources to ensure they are getting the best deal possible on every transaction. Also, bots have a distinct edge over investors in that they can respond much faster.
Are crypto trading bots legal?
Trading using bots on the crypto and stock markets is legal, although they are only available on certain platforms and exchanges.
Do crypto trading bots generate passive income?
Crypto trading bots offer numerous advantages, but you should only use them to avoid tiresome and time-consuming repetitive tasks, increase your accuracy, and have a tool that can watch the market 24/7. There is no assurance using a crypto trading bot will produce earnings. If you want your chosen bot to perform as you want, you’ll have to put in some effort to fine-tune it. The best trader is still you, so don’t think of them as “a set it and forget” solution.