Automated trading is not a new concept in the financial industry. But the use of automated bots in cryptocurrency trading has been limited until now. Owing to the high volatility in the cryptocurrencies, including Bitcoin, Litecoin, Dogecoin, and Peercoin, traders have usually felt comfortable in making trading decisions themselves. But, automated bot trading is relatively independent of the human emotions, which often cause more losses than intended.
Do Autotraders make money?
Autotraders work on algorithms designed using various technical indicators. The bots execute trades based on what the algorithm suggests. For example, a predictive algorithm will initiate ‘buy’ trades on Bitcoin if it expects the price to stage a rebound. Joseph Lee, the founder of derivatives exchange BTC.sx, claims to have multiplied his investment of $100 several times to $200,000. However, he started using his bot when the price lingered near $2, but sensing the future price movements remains the key to successful trading.
Prominent Cryptocurrency Automated Traders
BTC Robot- Nanobot
- Haasbot
- Butter Bot
Which exchanges are supported by automated trading bots?
Till date, all the major Bitcoin exchanges are supported. Haasbot allows its users to fully automate their trades on BitFinex, Bitstamp, BTC-E, BitTrex, Camp-BX, CEX.IO and others. Nanobot primarily focuses on BitTrex. Butter Bot supports Litecoin and Bitcoin trading on BitStamp and BTC-e.
Users can also create customized bots using different trading strategies on CryptoTrader, and can also rent them to others.
Why haven’t they become successful?
The cryptocurrencies are still in their initial stages and the major focus of the industry remains on high volatility and safety measures. Additionally, the bots implement the strategies designed by humans, so the human element is not completely out of the scene. The bots also fail in valuing the currencies at a fundamental level.
Conclusively, interested participants who wish to capture the numerous trading opportunities presented in various cryptocurrencies must try the bots at least once. However, starting with small sums would be highly advisable until substantial experience is gained.
