How Do Crypto Trading Bots Work? Case of Trade Butler
14th July 2021
Automated trading instruments or bots went mainstream in crypto during the ICO boom of 2017. But how do they work and why are they so popular among crypto newbies and OGs?
Cryptocurrency trading bots can be of use for the automatization of trading strategies. Meanwhile, the segment of trading bots is over-saturated with scammers, so finding legit ones isn’t an easy task at all.
What are crypto trading bots?
Crypto trading bots are software mechanisms that place and execute orders on crypto trading platforms on behalf of their users in an automated manner. As a result, users don't need to check the market dynamics manually.
Reliable crypto trading bots are sophisticated applications like wallets, exchanges and so on. Some of them directly access blockchain nodes like Binance Smart Chain node, Ethereum node, Bitcoin node, Polygon node and so on.
Typically, a user needs to set up the range when the trading bot is active (e.g. between $33,000 and $35,000 for BTC/USDT pair), to customize the intervals (e.g. $1,000 interval would mean trading bot monitors reaching $33,000, $34,000 and $35,000 levels), and to fuel it with a certain sum of money (required to place the orders). Once this is done, bot starts buying crypto ‘at lows’ and selling it maximally close to the upper border of this or that interval.
Thus, trading bot scans the price fluctuations of a certain trading pair. If it is activated for the futures trading pair, it also checks the ration between short and long positions.
GetBlock joined many long-term partnerships with crypto trading bots’ teams. Within the collaborations, bots work with the BSC node, Tron node, and so on. Similar services are delivered to decentralized gaming platforms, multi-currency wallets interested in connecting to Binance Smart Chain public nodes or other mainstream smart contract platforms.
Why are crypto trading bots popular
Crypto trading bots gained massive popularity due to its intuitive interfaces, easy usage, and high potential rewards. While using crypto trading bots, crypto enthusiasts are totally free from ‘heavy lifting’ as these AI-powered instruments execute orders in an automated manner.
Cutting-edge on-chain crypto trading bots of 2021: Introducing Trade Butler
In one of our previous how-tos, we briefly indicated a few things to look at while choosing trading bots.
In a nutshell, a good trading bot should be compatible with different exchanges, support many trading pairs, demonstrate a proven track of reliable operating with high uptime, and have good reviews on third-party platforms.
Thus, a proper crypto trading bot should have a large toolkit of connections to various platforms, a wide range of accessed nodes (Bitcoin node, Ethereum node, BSC node, Polygon node, to name a few), and care about its reputation.
Trade Butler Bot
Trade Butler Bot is among the small cohort of trading bots that execute orders directly on-chain. With this purpose, its team established a connection to Binance Smart Chain node and Ethereum node.
Due to seamless access to public node BSC and Ethereum nodes, Trade Butler Bot can be integrated into leading exchanges on Binance Smart Chain and Ethereum, namely PancakeSwap (CAKE) and Uniswap (UNI).
Besides typical crypto trading bot features, Trade Butler Bot boasts an advanced toolkit: with its instruments, crypto enthusiasts can snipe new listings for the best entry price and pre-approve tokens on purchase.
Trade Butler Bot team is laser-focused on its security, privacy of its users, and flexibility of trading functions. Keypairs are stored locally so that Trade Butler Bot doesn’t access the sensitive information of its customers.
Also, working with BSC nodes and Ethereum nodes is cost-efficient with Trade Butler Bot: its team implemented novel gas mechanisms.
Finally, Trade Butler Bot pioneers an eccentric fees model: in order to enjoy automated trading, you need nothing but holding its native TBB token.
Alternatives: On-chain trading bots for Binance Smart Chain node
AvidDot is yet another interesting bot that can be integrated in DEXs on multiple blockchains. Just like Trade Butler Bot, it interacts with public node Binance Smart Chain (BSC) and executes orders in lightning-fast speed leaving no space for front-running.
Then, LimitSwap bot also boasts multi-chain functionality as it can work with both DEXs on BSC nodes and Ethereum (ETH) nodes. Its ecosystem is built around LIMIT token so that its holders can utilize the bot in a privileged manner.
In this short review, we tried to address an interesting and turbulent segment of trading bots. Some of them went on-chain and started to work directly with Binance Smart Chain nodes, Ethereum nodes, Polygon nodes and so on.
By accessing public node BSC, these AI-powered instruments ensure the fastest and cheapest interaction with blockchain and the most accurate execution of automatically placed orders.