Ever since the inception of the cryptocurrency industry, traders and investors have been offered a wide array of lucrative revenue streams. Despite the high volatility, the return on investments (ROI), and annual percentage yield (APY) lure the users towards this domain. One special mention is Liquidity Mining, which is a salient DeFi mechanism. It has proven to be a good passive income option for traders.
Remarkably, Liquidity mining paired with algorithmic crypto trading has conquered the attention with its inclusion of automated crypto bots. Traders opted to explore it over manual trading. Notably, the 12-week XDC Liquidity Mining Campaign is now powered up by automatic decentralized market making bots generated on Hummingbot. Users can log in to claim a reward pool of $36,000.
From creating a customized bot to installing the configuration and running it, the entire process is carried out promptly in minimal commands – “connect”, “create” and “start.” Hummingbot enables user-friendly liquidity mining via crypto bots. Hence, liquidity mining can be initiated from home too.
Let us now discuss the step-by-step guide, as mentioned by the XDC Dev Forum, to be followed for a seamless process.
1. Necessity of a KuCoin or Gate.io Trading Account
The token of entry into the process of setting up a market making bot is a trading account on the crypto exchange – either KuCoin or Gate.io. Creating a new account is also simple on the exchanges.
2. Installing Hummingbot Software
Hummingbot is an open-source software specially meant for creating and maintaining an assemblage of decentralized crypto trading bots. It is compatible with and runs on local devices such as laptops and even on a cloud base.
The complete compilation of the instructions on how to install and setup the software is given in the following link: https://docs.hummingbot.org/installation/#source
3. Connecting API Keys
Once the installation is complete, users initiate the first command – Start Pure Market Making. Following it, users will run the “connect exchange_name” command. Through this, they have to enter the keys (API & Secret) and passphrases of the associated exchange.
The exchange API Keys serve as the gateway for the decentralized market making bot trading. Users can start the genesis of their XDC trading bot in less than no time by integrating their KuCoin or Gate.io API keys. As a confirmation of the process, the message – “You are connected to KuCoin/Gate.io” pops up.
4. Creating the Bot & wiring the strategy
To initiate the creation process, the user will be running the next command – “create”. It creates a bot and asks “What is your marketing strategy?”. Users should type in ‘pure_marketing strategy’.
Next, ‘Enter your maker spot connector’ pops up. Users will have to mention the name of their preferable maker exchange (KuCoin/Gate.io).
5. Setting User’s Preferred Trade Inputs
Adding Trading Pair
By default, this trading bot supports only the XDC:USDT token pair. hence, users will choose XDC:USDT option.
Specifying Order %
Now, the value of the percentage of the ‘first bid order’ and ‘first ask order’ has to be added in numbers. For instance, if it is 1%, the number “1” has to be entered.
Setting the Time Interval
Users can choose a time interval from the range of 0 to 60 seconds.
Fixing the amount of XDC
Enter the amount of XDC (in numbers) per order. After it, the program asks for a ping pong feature. Users have to select “No”.
After carefully giving these inputs, one has to save the profile. Hence, the configuration is complete.
6. Final Step
After all these series of commands, to successfully start the bot, enter the “start” command. A regular review of the order book is recommended. When necessary, users can modify the marketing strategy as well.
On completion of this, users enter the campaign with DeFi market making bots to earn the rewards. Hummingbot connects the community to major DeFi and CeFi marketplaces and levels up high-frequency trading. The XinFin XDC Network and its associated community advance toward the decentralization of the trading ecosystem.