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The 5 types of trading bots

Open source trading bots

Open source trading bots are free software that you can install and configure for free. They usually offer many features and one of their strong points is customization. On the other hand, you usually need a minimum of technical knowledge to install and configure them. The configuration of the strategies is usually done with code or pseudo code, although in some cases you can download strategies from the Internet. Deployment is also to be taken into account. In general, one avoids deploying this type of software on one’s personal computer, as one would not be able to turn it off and would be dependent on one’s personal environment.

Cost : free (unless deployed on a dedicated server)
Examples : Freqtrade ([Tutorial] Your first trading bot with Freqtrade) , Zenbot, …

The source code of Freqtrade, a trading bot, on GitHub

Customizable online trading bots

Many services offer customizable online trading bots. Compared to open source trading bots, you can also customize them, but you don’t have to worry about deploying them. The company takes care of their execution and maintenance in the cloud. Some are distinguished by 100% visual interfaces where you can configure and customize your trading bots without technical knowledge. This is for example what we offer at Botcrypto.

Cost : a subscription (starting at $10 per month in general) or fees

An example of a strategy customizable without technical knowledge on Botcrypto

Ready for use online trading bots

The trading bots that we call ready for use are among the easiest to handle. Their developers have developed one or more strategies that you don’t usually know and control. Once you set up your trading platform, everything is automatic. There is no need for technical knowledge, but you must have absolute confidence in their developers since you don’t know what the applied strategy is.

Cost : a subscription (starting at $10 per month in general) or fees

Copy trading online trading bots

Copy trading consists in replicating the actions of other traders considered competent. Some companies have replicated this model with trading bots: some traders create trading bots (with or without a visual interface), others replicate these trading bots (but without knowing the behavior of the strategy). It is in fact a mix between the two previous categories, customizable trading bots and ready for use trading bots. You usually have a marketplace, where you can access all available trading bots, which are usually rated by their users.

Cost : a subscription (starting at $10 per month in general) or fees

Scams

Unfortunately, trading bots attract many investors who think they can get regular income easily. That’s why there are many scams in the world of trading bots. Avoid services that promise guaranteed performance, and be very careful!

Cost : everything 🙃

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With Dollar-Cost Averaging, invest serenely in bitcoin and cryptos

Leave a Comment / Discover bots, Discover cryptos, Learn trading / Théo

Have you heard of bitcoin? Do you want to invest in bitcoin or another cryptocurrency? Then Dollar-Cost Averaging is surely THE method you need to discover now.

What is Dollar-Cost Averaging?

This simple strategy consists of investing the same amount of money at regular intervals in order to reduce the risks associated with volatility. It is mainly intended for investors who aim for the long term. Instead of buying $1,000 of bitcoin tomorrow and taking the risk that it will lose 20% of its value in the following weeks, you can buy for $100 every month, thus smoothing your investment over time.

But does it actually work? Does Dollar-Cost Averaging improve returns and reduce risk in the long term?

Dollar-Cost Averaging in a concrete example

Let’s take a concrete example, where you discover bitcoin 3 years ago and see what happens with and without it.

Without Dollar-Cost Averaging

If you had invested this 3600$ on December 3rd 2017, you would have received 0.32 BTC. 0.32 BTC is worth $6176 at the time of writing. It is therefore a good investment but the value of your investments will have fluctuated enormously over time especially with the bursting of the bubble in early 2018.

Without Dollar-Cost Averaging

Let’s imagine that instead of buying for $3,600 3 years ago, you would have bought $100 worth of Bitcoin every month. On the dcabtc.com calculator, we can see that with the Dollar-Cost Average strategy, you would have 6812$ today. That’s nearly $700 more by investing the same amount!

Screenshot of Dollar-Cost Average simulator dcabtc.com

So obviously, this added value depends on when you start your investment. In some cases where you invest at exactly the right time, Dollar-Cost Averaging will be less effective. But investing at the right time is not that easy. Dollar-Cost Averaging overcomes this difficulty by smoothing investments and reducing the risk of investing at the wrong time.

How to make a success of this strategy?

You must be wondering why I’m talking about the success of his strategy. How could we fail? It’s quite simple, isn’t it? Well, it’s not.

First, you need to define the parameters of your Dollar-Cost Averaging strategy. For example, if you want to invest in Bitcoin, you can for example choose to invest €100 every month, or €20 per week, or even €5 per day! Of course, it all depends on how much you can afford and what you want. These parameters are at your discretion.

Then, the only rule is to respect these parameters. And you’ll see that it’s not going to be that easy, especially with cryptocurrencies, which are very volatile assets. When prices go up or down all at once, it’s going to be very tempting to accelerate your investments, or to let some time go by. But then you lose all the advantage of Dollar-Cost Averaging.

An interesting solution is to use software that sends the purchase orders for you. Our platform Botcrypto allows you to easily set up trading bots that apply Dollar-Cost Averaging strategies. With a few clicks you can start your trading bot that applies a strategy like the one below, where every month a buy order for $100 of Bitcoins is sent.

Screenshot of a Dollar-Cost Averaging and bitcoin strategy on Botcrypto — This strategy buys for $100, waits 30 days, buys for $100, waits 30 days, etc.

This way, no need to log on to an exchange every month. Your trading bots take care of applying your strategy for you. You can import this strategy for free from the Botcrypto store. It’s the Monthly DCA strategy.

In conclusion, Dollar-Cost Averaging is a very interesting investment method for all those who want to invest in Bitcoin and cryptocurrencies on a long-term basis, without having to think about it on a daily basis. With this method, you reduce the risk, both upwards and downwards, but what is certain is that you gain peace of mind!

I try Dollar-Cost Averaging bots

With Dollar-Cost Averaging, invest serenely in bitcoin and cryptos Read More »

Botcrypto Monthly Report #22 – November 2020

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We just finished one of the most important months in Bitcoin’s history, at least in the history of its prices, with the highest monthly close price ever! It’s even more motivating to develop trading bots in these conditions, so here is the very large list of news from the last few weeks.

Development

Here is the list of the main new features of the last few weeks on Botcrypto, the platform to create easily and quickly cryptocurrency trading bots.

The Botcrypto rating reveals the best strategies of the strategy store at a glance. Full details on its calculation are available here.

The automatic classification of market trends over the week makes it easy to find the most bullish/bearish market. We have written an article on how this classification works (only in French at the moment).

Screenshot of the trends — Trends are displayed on the dashboard by clicking on the *Trends* button.

The addition of advanced parameters for strategy indicators, such as the Multiplier that allows to make conditions like “When the price is above the EMA +3%”. The Buy EMA9 rebounce strategy is a good example.
From now on, you no longer need to create an account or be logged in to view the store’s strategies (click on the link above to see!). This makes it much easier to share strategies publicly.
Follow the evolution of the strategy in real time with the display of the current state of the bots.

The current state is displayed with a gold border!

The suggested backtest periods are now much smarter and correspond to the TU of your strategy. The TUs of the strategies are also displayed directly on the strategy card. No more need to call your strategies Buy EMA 4H 😉

We plan to continue at this pace in the coming months, so don’t hesitate to suggest improvements on our Discord server where we are already close to 500 traders! You can also vote for the next features directly on the dedicated page.

The LOCKDOWN Contest

The LOCKDOWN Contest, the free and educational contest that we have set up has been extended for 15 days. You can thus continue to use this space to learn and improve your trading skills. Feel free to share your successes, failures and questions on our Discord server (again!), which also displays daily contest rankings.

The best traders of our contests are published on Discord

The Shark Week

We had the pleasure of hosting the Shark Week, the trading competition organized by the Transaction and Plug’n’play associations of the emlyon school. More than 300 students discovered bitcoin and crypto trading during one week thanks to Botcrypto’s virtual trading features. The results were quite good, as more than 20% had positive results. Congratulations!

In this context, we also spoke at a webinar entitled “Les cryptomonnaies : quels enjeux ?” where we discussed many topics related to cryptocurrencies: news, advantages and disadvantages, regulation… It is available in replay here.

Les cryptomonnaies : quels enjeux ? by Constantin De La Roche and Théo Poizat — *Les cryptomonnaies : quels enjeux ?* by Constantin De La Roche and Théo Poizat

With an ATH that has been hit several times recently and high volatility, cryptos trading bots are particularly interesting at the moment. So, what are you waiting for to (re)launch yours on Botcrypto? 😉

Botcrypto Monthly Report #22 – November 2020 Read More »

Black Friday 2020 : subscribe once = get one free

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For Black Friday 2020, we are very happy to offer you an offer never seen before on Botcrypto!

For this occasion, all subscriptions are simply doubled! This means that if you buy 6 months of Silver subscription, you will receive 6 months of additional Silver subscription! You will be able to enjoy all the advantages of trading bots on Botcrypto 2x longer! 😉

I subscribe

Terms

All subscriptions taken between November 27th at 2:00 pm (Paris time) and November 29th at 11:59 pm (Paris time) will be eligible. Subscribers will receive a gift code corresponding to the doubling of the subscription within 7 days after the end of the operation, within the limit of one year of subscription.

Update: The Black Friday offer is also valid during French Black Friday, i.e. for all subscriptions taken on Friday, December 4, 2020 (Paris time).

Black Friday 2020 : subscribe once = get one free Read More »

Why is virtual crypto trading ideal to get started in crypto trading?

What is a virtual portfolio?

Many trading platforms offer virtual portfolios. On Botcrypto for example, you can create a virtual portfolio with a virtual $10,000, and pretend it is your first investment in cryptocurrencies. You will be able to buy Bitcoin (BTC), but also Ethereum (ETH) and other Altcoins like Ripple (XRP), or Dogecoin (DOGE). You will be able to see the evolution of your funds and investments in complete security, and discover trading by practice!

Managing your emotions

You probably already know that cryptocurrency is a highly volatile asset. At the time of this writing, Ripple (XRP) for example has taken more than 100% in 2 days.

Capture d'écran de la paire XRP/USD prise sur TradingView le 11/24/20 — Screenshot of the XRP/USD pair taken on TradingView on 11/24/20

Knowing how to manage your emotions is essential in trading, and even more so in cryptos. You must avoid panic and euphoria at all costs, but also FOMO (Fear Of Missing Out), the fear of “missing the train”. Trading with a virtual wallet allows you to feel these emotions, to understand what it feels like to have “missed the train”. If you see from one day to the next that your portfolio, even virtual, only takes 10% while another asset has taken more than 100%, you quickly feel this sensation, this “if I had done that, I would already be rich“. And you can tame it to control it.

Hold on the long term

It is often said that 90% of stock market traders don’t last more than 6 months, and the number is surely the same in the cryptos. That’s why learning about trading only a few days before investing and trading all your savings is a bad idea. It is also necessary to pay attention to successes. Just because you win in the first week doesn’t mean you’re a good trader. The important thing is to keep the distance. To be profitable 1 year, 2 years, even 5 years later. Training with virtual portfolios is the possibility to see your virtual capital evolve over several months or even years, and prove that you can hold on the long term.

Configure your fictitious portfolio on Botcrypto, and hold on for the long term

Testing new strategies

Finally, virtual trading is the possibility to test new strategies in complete security. You are an experienced trader, with a strategy that works, but you want to experiment with new indicators, or even a new strategy? Backtests and simulations will be your best friends to save time, and quickly and safely evaluate if your strategy is interesting.

So obviously, some will say that it is not the same to trade with a virtual portfolio compared to real funds. And I completely agree. With real funds, emotions are multiplied. But virtual trading, if applied correctly and with good will, allows a first complete immersion in trading, and thus safely accelerates one’s learning of crypto trading.

If you want to learn crypto and bitcoin trading, botcrypto is for you! You can create virtual portfolios easily before getting down to business. Everything is explained in the video below.

Why is virtual crypto trading ideal to get started in crypto trading? Read More »

Botcrypto Monthly Report #21 – October 2020

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Backtest configurations, new indicators and states, new project on crypto friendly services, contests, here is the Monthly Report #21!

Development

Discover below all the major updates of the last few weeks. Many bug fixes and small interface improvements have also been deployed. You can find them on our Discord server where we share all the updates on Botcrypto on a daily basis.

Backtest presets

With the backtest configurations, no more filling of the same backtest settings multiple time. With one click, you fill in all the fields with preset parameters. It’s perfect for iterating on a strategy step by step. We love this feature at Botcrypto!

Indicators and states

Multiple indicators have been added :

Choppiness Index
Commodity Channel Index
Elder’s force Index
SuperTrend

We have also improved the Wait state to be able to wait until a certain time of the day.

Onboarding and tutorials

With Botcrypto, we have designed the simplest and most intuitive interface possible to make cryptos trading bots accessible to all traders. But having a simple and intuitive interface is not enough. It is also necessary to guide traders in learning how to trade (which we propose with the blog), and in understanding the concepts of trading bots. This is why we have completely rethought onboarding and tutorials. Here are the new features:

a step-by-step tutorial to create your first strategy and your first backtest (which you can redo by clicking on the Help button in the top right corner of the Botcrypto interface)
a new Helpdesk with more content

Trading Contest #1

Trading Contest #1 ended on October 15th. 70 participants traded on two virtual portfolios of cryptos for almost 2 weeks. Congratulations to bob’, the big winner of this edition. You can now read his testimony in the article dedicated to the results of the Trading Contest #1.

Crypto Friendly Services

After more than 3 years of activity in the cryptocurrency sector, we have discovered that many professional services are blocking the use of their services by companies working in the cryptocurrency industry. This is a waste of time for all the players in the ecosystem. This is why we created Crypto Friendly Services, the collaborative list of the best crypto friendly professional services. Initial feedback has been very positive, and the project has been shared on bitcoin.fr and in 21 millions, Grégory Raymond’s newsletter.

Thank you all for reading this Monthly Report #21, and see you soon on Botcrypto!

Botcrypto Monthly Report #21 – October 2020 Read More »

What is a trading bot? How does it work?

What is a trading bot?

A trading bot is software that trades, i.e. buys and sells assets with the aim of making a profit. There are trading bots for all types of assets: for cryptocurrencies such as bitcoin or ether, but also for shares, currencies, etc. Just as a trader will monitor the markets to find the best opportunities, a trading bot will monitor the markets and react to conditions with actions.

For example, a trading bot will monitor the bitcoin/dollar market (BTC/USD), and as soon as the price of Bitcoin exceeds $12,000 (this is the condition), it will sell 1 BTC (this is the action).

All these conditions and actions are pre-programmed by traders (maybe you soon 😉). Of course, conditions and actions can be much more complex, using technical analysis tools, artificial intelligence, etc.

At the end of this guide, you will know everything you need about trading bots

What is the purpose of a trading bot?

Trading bots are generally used to generate profits, but they can also be used to invest more efficiently (e.g. with the Dollar Cost Averaging strategies wel will discuss later), or even to protect your capital.

Of course, a distinction must be made between trading bots for individuals and for companies. The needs are not at all the same, and neither are the budgets… We will speak very little about high frequency trading and arbitrage for individuals since these activities require specific infrastructures.

How does it work?

For anyone interested in knowing how it works, here are some explanations. Without going into technical details, we are talking about a software that:

retrieves market data
checks conditions (if the price of bitcoin exceeds X €, if the exchange volume increases by Y%, …)
execute actions (sell Z BTC, …)

And that’s it! Thanks to a dedicated interface, called an API, a trading bot can send orders on your behalf directly to your preferred exchange. For this reason, you generally need to provide API keys to all services that use an API. This is simply to identify and authenticate you.

General operation of trading bots (in French, sorry!)

Finally, a trading bot must be operational 24/7, otherwise it loses much of its interest. This is why they are usually deployed on servers in the cloud. We strongly advise against hosting your trading bot yourself without having the skills and the time. If you want to know more about this, join our Discord server to discuss with our team. We will be happy to discuss this with you.

Now you know what a trading bot is, and even how it works! Now you want to know what the real advantages of trading bots are? That’s good, that’s the subject of the next article!

What is a trading bot? How does it work? Read More »

The 4 real advantages of trading bots (and their limits)

2 Comments / Discover bots / Théo

Welcome to the second article of our guide about trading bots! Trading bots are becoming more and more common, especially in cryptocurrencies markets. They are attributed many qualities. Some people think they are THE solution to get rich easily and quickly (spoiler, it’s not so easy and fast). Others think, on the contrary, that it is a scam and that there is no point. After 3 years of working on Botcrypto, we are convinced that trading bots have real advantages, but also limits. That’s why we will see in this article what you can expect from trading bots, and what you can’t.

Can we invest more efficiently with trading bots? We will see!

The 4 real advantages of trading bots…

1. Trading bots are operational 24/7.

Unlike us, trading bots are operational 24/7. This is particularly interesting for cryptocurrencies like bitcoin, where markets are continuously open. This means you no longer need to monitor the prices of your cryptocurrencies in the evening, at night, at the weekend, at work, etc. You save time.

2. Trading bots offer new opportunities

Between their permanent presence on the markets and their ability to process a lot of data simultaneously, trading bots offer new opportunities that humans would not be able to seize. Taking advantage of the best prices at any given time, analysing large amounts of data instantaneously to determine entry and exit points, everything is possible for trading bots that bring the benefits of IT. You gain in efficiency.

3. Trading bots don’t give in to their emotions

Emotions are the trader’s worst enemies. And a trading bot, since it is a bot, does not give in to his emotions. He doesn’t panic (neither up nor down) and applies rationally what he was designed for. This avoids the risks of FOMO, Fear of Missing Out, i.e. the fear of missing an opportunity. You gain peace of mind.

4. Trading bots react quickly

For the same reasons, trading bots react quickly. Very quickly. Not to mention high-frequency trading, which is another subject, trading bots can analyse a lot of data and act accordingly much faster than a human. They will have no hesitation. In highly volatile markets, such as with cryptocurrencies, the ability to react quickly is a considerable advantage. You also gain in efficiency.

… and their limits !

First of all, remember that trading bots only do what they are told. There is no magic. You have to pay particular attention to the configuration, and provide safeguards. Risk management is essential. And as usual, you should not put all your eggs in one basket.

First of all, remember that trading bots only do what they are told. There is no magic.

We can also talk about other limits:

Cost. Trading bots always involve costs. Regardless of the model (subscription, commission, profit, …), these costs must be taken into account in the results. The rates vary from a few euros to several hundred or even several thousand euros per month.
Security. In order for a trading bot to use your funds, you must give it access to your account on a trading exchange by sharing your API keys. Of course, sharing your API keys is not trivial. There are good practices to follow as we have explained in this article on API keys. You must carefully select your service providers to keep your funds safe, and in particular respect our 3 rules to avoid being fooled by trading bots (article currently only in French).

There are advantages and limits with trading bots!

You now know the difference the true and false advantages of trading bots. In the next articles, we will learn how to use them correctly to get the most out of them. Do you see other advantages and limits to trading bots? Tell us about them in comments! ✍️

The 4 real advantages of trading bots (and their limits) Read More »

Trading Contest #1 results

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After almost 2 weeks of trading, Trading Contest #1 is over. It’s time to reveal the winners… Let’s see the results!

The winners

Congratulations to bob’ who takes first place in the ranking! He managed to make his 2 BTCs grow in 2.149 BTCs in 2 weeks, which corresponds to a 7% gain. As we said in the Trading Contest #1 launch post, he wins 100 USDT.

Congratulations also to the two following Unikname users with 4.75% and 3.5% gain. They won 60 USDT and 40 USDT. I take this opportunity to send a message to the two Unikname users, contact us so that we can give you your prizes.

Résultat du Trading Contest #1, le concours de trading de crypto Botcrypto — Congratulations to bob’ !

bob’s interview

Want to know how bob’ won the Trading Contest #1? So do we! Here’s his answer translated in English.

I am more of an observer, and having realised on the market cap that the FYI was very very volatile, I tried to make my balance grow with this currency, trying to place manual orders. I thought it was fun to compete against the bots, using only manual orders.
bob’

For trading bots enthusiasts, one could take it badly… But on the contrary! The important thing in trading is to find your method, the one you master, the one that works for you. Botcrypto is above all a tool at your service. We propose a unique solution to create easily trading bots, but also to send manual order in multiple exchanges, with educational ressources, etc. It’s up to you to make the most of it, just like bob’ did 😉

Next editions

We are very satisfied with this Trading Contest #1! Nearly 70 participants tried their luck, 50% more than in the previous one.

Of course, we are going to plan other competitions, but in different forms. The rules may be modified to bring out other types of strategies. We are also studying the possibility of organising private trading contests and/or sponsored by existing communities in the crypto world. If you are interested, contact us !

Trading Contest #1 results Read More »

Botcrypto Monthly Report #20 – September 2020

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New features and Unikname’s integration, Trading Contest #1, we explain everything about this month of September full of new features!

Development

The arrival of Emil and Quentin gave a very pleasant boost to the development of Botcrypto. Here is a short round of updates.

The arrival of labels

To help you better organise your strategies, we have introduced strategies and bots labels. You can create labels, assign them, and thus easily find your strategies and bots according to your criteria. Some sort by market, such as bitcoin and altcoins, others by trend, bull or bear, in short, you determine your criteria! They are also available in a reduced form on the strategy store where everyone can share and import their strategies. If you want to know more about labels, everything is explained in the dedicated article on the Helpdesk.

Labels are the best tool to organize your strategies!

The revival of the strategy store

Let’s talk about the strategy store! We developed it almost two years ago, and it has hardly been updated since then. That’s why we decided to start a major project on the strategy store to make it more pleasant and more intuitive. Our aim is to strengthen the exchange and sharing of knowledge. In addition to the labels seen previously, we have put back in place the rating and commentary system and added the sorting of strategies by rating, by use and by label. Eventually, we will provide new information, such as backtest results, to help you better choose your strategies.

The feature suggestion page

We have always wanted to make Botcrypto more open to our users, more community oriented. This is why we have added a feature suggestion page where each user can vote for the next indicator, the next exchange, or even the next features. Let’s vote!

Still a bit empty, the new features page is just waiting for you!

And many other new features

Other new features include :

Keltner channels, a technical indicator based on moving averages
the ability to create backtests directly from a strategy card
a lot of fixes in the bots management page

We have also added a new help center accessible from all Botcrypto pages. It allows you to redirect directly to the Helpdesk or the blog to find the most adequate information. We have other projects planned to help you create the most efficient bitcoins and cryptos trading bots. But I won’t tell you more for the moment…

Botcrypto x Unikname

Alternative connections such as Facebook or Google Connect are very successful, and for good reasons. Unfortunately, who says Facebook or Google, says “big appetite for your personal data”. At Botcrypto, your personal data is just as important to us as our personal data. So when we had the opportunity to integrate Unikname Connect, the French decentralized 1-click authentication solution which ensures that your personal information remains private, we didn’t hesitate for a second!

The operation is simple! From the dedicated application installed on your smartphone, you manage your unique identifier, your @unikname, which allows you to connect. How does it work? When you want to connect to Botcrypto, click on “Connect with Unikname”, you will then receive a notification about your application, enter your PIN code to confirm the authentication and that’s it, you are connected! No need to juggle between dozens of identifiers, nor to use a password manager. The advantage is that your @unikname is stored in a dedicated blockchain, UNS.network, and its operation guarantees the confidentiality of your data. You are in control of your digital identity.

You can log in now with your @unikname on Botcrypto!

In use, logging in with your @unikname is simple, fast and secure. Several team members have tried it and are now convinced! So what are you waiting for to create your own and use it on Botcrypto?

Trading Contest #1

We launched the communication of the Trading Contest #1 at the end of September, and to date almost 50 participants have responded. The objective of this contest is simple: to make 2 BTCs grow for 2 weeks. Everything takes place on a virtual wallet. There is therefore no risk, except that of winning the 200 USDT at stake! Moreover, registration is still possible… Don’t hesitate to try your luck, since everything is possible with trading bots!

That’s it for this Monthly Report, one of the richest ever written! The next one should be on the same level, so follow us on our blog and our social networks (Discord, Facebook and Twitter)!

Botcrypto Monthly Report #20 – September 2020 Read More »