Most people like to draw similarities between trading of securities and trading in cryptocurrencies (especially Bitcoin), and rightly so. Despite the high volatility of these two sectors, the potential profits are incredibly lucrative and can turn an investor's fortunes within a relatively short period. Nonetheless, to ensure the continuity of profitable returns, it is imperative to closely follow the most recent developments in the industry, particularly the performance trends of various digital assets.
Specific exchange pairs such as BTC to USD are directly impacted by any announcements that influence the strength of the dollar as well as developments that affect the reputation of Bitcoin. Contrary to the wide-held belief that crypto traders need an in-depth understanding of market dynamics and financial matters, it is possible to invest in this sector without prior experience.
However, a majority of interested individuals still have reservations about delving into the crypto space, as they find the prospect of analyzing performance graphs, predicting trends and making statistical calculations to be intimidating. For this reason, there has been a rapid proliferation of Bitcoin trading robots that seek to assist novice traders on how to navigate in the complicated world of cryptocurrency trading.
What are Bitcoin Trading Bots? How do they Work?
As their name suggests, Bitcoin trading robots are expert systems that leverage an inbuilt artificial intelligence software to assist the investor in making informed and potentially profitable investment decisions. Mostly, they make suggestions to the user on whether and when to buy, sell or hold a digital asset.
Fundamentally, these systems feature an AI infrastructure that is specifically tailored for the cryptocurrency trading industry. Moreover, the expert system uses machine learning techniques that interact with the human users and uses the collected information to modify the configurations as well as gain additional ‘knowledge.'
The ability to combine in-depth market analysis with human user input to develop a specified set of actions that investors undertake after specific activities in the market is perhaps the most significant milestone since the inception of trading bots. As of now, the trading robots know how to respond when the market is highly volatile and also when it is somewhat calm.
Examples of Bitcoin Trading Bots
Due to the high demand for Bitcoin trading bots within the crypto investors' community, manufacturers have upped their game and are currently releasing bots equipped with state-of-the-art features. Presently, the market is dominated by two key players, Haasbot and Tradewave. Nonetheless, some upcoming brands are aiming to end this duopoly. This includes RoFX and BTC Robot, both of which have distinctive merits as well as demerits.
The Haasbot is a 3-module software that features arbitrage, trading and order robots. It is manufactured by Haasonline, a platform that concerns itself with the development of crypto trading software.
The trading module of Haasbot comprises of three parts, safeties, indicators and insurances. The role of the trade bot is to issue trading signals and leveraging the user’s input to analyze market trends. Notably, the usage of this bot requires the user to have extensive knowledge reading the buying and selling of digital assets, as well as continuous monitoring of the software’s behavior.
Often, the integrated pre-ordering feature enables the software to mirror recurrent user actions. Nevertheless, Haasbot is a rigid bot that needs constant adjustment of parameters to work appropriately.
Tradewave uses a unique approach that allows all users to contribute trading strategies which undergo back-testing before deployment on the platform. Essentially, the system fuses various user inputs and treats them as crowdsourced instructions. Usually, the minimum monthly subscription fees for the Tradewave algorithm is $14, although this figure can go up to $100 if additional bots are required.
While Tradewave does not require its users to have programming expertise, it still needs the investor to be adept at making sound financial decisions. Therefore, the absence of coding does not negate the necessity of knowing how to manage market volatility, evaluate risk-reward ratios and so on.
Unlike the alternatives mentioned above, RoFX is a fully automated system that can operate without prompting for the user’s input. The software trades throughout and deposits the accrued profits in the investor's account on a daily basis. To enjoy this services, users are required to register and select their preferred investment plan. As expected, the more expensive a package is, the higher the profits.
Hands down, RoFX is vastly superior to Haasbot and Tradewave, primarily because it does everything for the investor, including market research, programming, monitoring of trends, and so on. On the hand, its competitors are somewhat ‘incomplete' as compared to RoFX since they require the user's input to operate fully.
Therefore, this makes them an inconvenient option, mainly if the trader involved lacks sufficient knowledge about the financial aspects of cryptocurrency trading. Judging by its merits, RoFX is indisputably the best Bitcoin trading robot currently available in the market.