The crypto market is a 24 hour market that operates on each day of the week. Due to the operating hours it can be hard to manage the position of trades physically. This is why many traders refer to use bots to do their trading for them. Bots are computer programs that have been programmed to conduct trades. Bots can be programmed to either perform part of the trade or do the whole trade. It is legal to use bots to trade on all cryptocurrency exchanges as well as some stock exchanges.
Which kind of bot do you need?
There are two kinds of bots: prebuilt and hosted bots and self-built and hosted bots. If you are not a technical person then pre-built bots are a good choice for you. The prebuilt bots are further divided into two categories: the fully built ones (these ones have a pre-programmed strategy) and the programmable bots that need you to implement a strategy using the automated trading platform.
How to pick a bot
If you are a new trader the best thing to do is choose a programmable pre-built bot that is friendly to beginners and has a long trial period. Apart from assessing whether the bot is beginner friendly make sure the bot can be used on various exchanges and there company has great customer service.
You need to be careful as you research on a bot to use because the cryptocurrency space is not risk free. Choose a site that offers you the chance to try various strategies for a good period of time before making any payments.
Tips on crypto bot trading
Each bot and exchange has its own unique characteristics. Before you set up your bot you need to remember that you have to create API keys to get your bot to function. Different exchanges have different guidelines on how to create API keys which must be followed so as to successfully operate the bot on the exchange.
If your API keys do not function you need to: counter check the instructions, use another browser or just try to create another key set. Remember to keep your API keys safe and if possible keep the offline to decrease the chances of being hacked. If someone else manages to get your API keys then they can make alterations to your account.
Another safety measure to follow is to never grant your bot the right to withdraw funds. It is not wise to give the bot rights to withdraw funds. When conducting an arbitrage you may give a bot the right to withdraw funds. If your bot does not have the permission to withdraw then in case someone hacks your bot then the worst thing that they can do is make bad trades.
If you realize that you have been hacked you need to move swiftly and delete your keys, reset your passwords and raise a complaint with the bot company. The tips discussed above are bound to benefit both industry veterans as well as people that are joining the cryptocurrency bot trading industry.