Automated cryptocurrency trading: features, principle of operation, pros and cons

Automated cryptocurrency trading: features, principle of operation, pros and cons

There is such a stock market, which is completely closed for the weekend with the fixing of the current rate. And there are cryptocurrency trading, the rate of which can change at any second, their volatility is difficult to predict even for those who have been on the crypto market for years.

You can both earn and lose an impressive amount on fluctuations in the exchange rate of coins. So it is better for investors not to be distracted from the news of trading exchanges. Of course, not everyone wants to be awake 24/7 and will always be ready to conclude a sale and purchase transaction. In this case, special systems help.

Cryptocurrency automated trading is a so-called bot that, when configured with the appropriate parameters, can independently purchase or sell a token with maximum benefit for the trader.

Let’s take a closer look at how the cryptocurrency automated trading bot works and what advantages and disadvantages it has.

What is a cryptocurrency automated trading platform?

The term cryptocurrency auto trading bot means a special tool that automates the process of trading and conducting transactions in the cryptocurrency market. A trader can independently set up a bot to search for tokens on the exchange according to the criteria that he will be guided by. 

For example, you set the following parameter: crypto automated funding bot should buy a specific coin that costs $20 only if it finds it at a price of $15. So, you do not need to independently search all the exchanges in search of a suitable rate – the bot will cope with this task.

At the same time, the use of a cryptocurrency auto trading platform is not always profitable. If only because such a system is non-standardized and can also work chaotically. So it is better to choose proven cryptobots, among which:

  • CoinruleWunderTrading;
  • Bitsgap;
  • Pionex;
  • Tradesanta;
  • Cryptohopper;
  • Botcrypto;
  • Gunbot etc.

The principle of operation of trading bots in the cryptocurrency market

Not all investors support the idea of using the so-called platforms to trade cryptocurrency automatically. The software is configured directly by the trader, taking into account the plan according to which he plans to work. Therefore, basic knowledge, and preferably in-depth, in the field of cryptocurrency is simply necessary for you.

In addition, it is important to stay involved and take the time to analyze the market. That is, work together with your bot, just spending a little less time than you would spend without it.

Advantages and disadvantages of cryptocurrency auto trading

Among the main positive points that a trader or investor using a crypto auto trading bot can count on are:

  • Automation that will save beginners from spontaneous purchases or vice versa – too long doubts and as a result of losing a profitable offer.
  • Fast reaction. Manually, it takes several minutes to conclude a sale and purchase transaction, and for beginners even several hours of work. The bot works in a shorter time.
  • Saving your time. Changes in the cryptocurrency market can be observed even at night while you sleep. At this time of the year that crypto automatic trading will be most useful.

Among the disadvantages of using it, one can note only the fact that almost all bots are unregulated and can be unreliable, requiring constant monitoring. Remember that you still need basic knowledge in the world of cryptocurrency to use them. At least in order to correctly configure the tool.