Binance is certainly one of the biggest cryptocurrency exchanges out there, in fact, according to a Bloomberg News report, it’s the largest exchange based on volume. This means that Binance offers a lot of liquidity and is often regarded as the safest trading platform in the whole market.
🤷 Why do you need to use a trading bot on Binance?
Automated algorithms are useful in any cryptocurrency exchange and the reason is quite simple, unlike normal stocks, the crypto market never closes, not even at night, it is live 24/7. This means that you won’t be able to always pay attention to the market. Additionally, normal orders like stop losses, market buy, etc are simply not enough if you are looking to trade overnight or when you are not home.
The high volatility makes it extremely risky to leave an order hanging on Binance when you are not around, trading bots are the most effective solution to this because you can create an unlimited amount of orders automatically and they will be executed instantly.
The crypto market is ruthless and extremely volatile, trades happen in seconds or less, a human simply cannot do it that fast, that’s when bots come in. You can execute an unlimited amount of orders instantly while reducing human error and getting rid of any human emotion, this translates into more profit. This also allows you to use different strategies that you won’t be able to use manually. Bots can also make many small trades which will eventually add up to a decent profit.
Trading bots are also able to monitor a lot of cryptocurrencies at the same time, considering there are thousands of different cryptos right now, this is an enormous advantage.
✅ Are you allowed to use trading bots on Binance?
Yes, you are allowed to use any trading bot that you want on Binance, in fact pretty much all exchanges out there have some automation setting on their platform. They are also legal, even in the stock market.
💻 Do you need to download special software?
These scripts can be used both online and offline downloading the required software. People will often be reluctant to download anything so they usually pick the online version since it doesn’t require you to install any scripts and allow you to have control over your trading on the go.
🛡️ Are Binance trading bots safe?
These algorithms will always use API’s which basically allows them to access the relevant information they need to operate while taking full control of your account. API keys are meant to be shared so for the most part, yes, it is safe to share your API keys.
However, trading services can be compromised and you should only use trusted ones. You should also never enable the withdrawal option when sharing your API key. Enabling 2 Factor Authentication is also advised and will add an extra layer of protection to your account.
🤖 Best Binance bots
With Binance being one of the biggest crypto exchanges around it is not a surprise that literally all trading bot support this platform:
📢 My personal results with Binance trading bots
I have tested multiple bot solutions connected to the Binance exchange and I have never experienced any issues with the API usage. There were different results during my personal experiments. Some of the bots and strategies were successful, some of them not.
The best profit received so far was with Bitsgap bot. It allows you to run Grid bots on the Binance spot market and Combo bots on the Futures market. I have tested both of these strategies and I was able to make a solid income. Read my Bitsgap reports for detailed information about the bot set-up and the management process.
Another successful Binance bot that I have tested is Cryptohopper. Its strategy is based on trading indicators that give a signal to buy a cryptocurrency once it experiences a dip. With a take-profit order, you can automatically sell the positions when the price is moving up. I have posted several reports regarding my Cryptohopper experience in the blog.
👌 Are there any free Binance bots?
A lot of trading bots will offer a free trial or version of their product. It is a great option to test the service, however, it is not recommended for the long term since it often offers far fewer settings and features than full versions. Features like, limited support, fewer pairs, limited volume or fewer strategies are some of them. You can also use trading management applications, such as GoodCrypto, where all the basic features are also free of charge.
💰 How much money do I need to start?
This is one of the first questions new users ask when they start trading, especially when they start using automated solutions. The answer is: depends. You will not need a huge amount of money to start using a bot on Binance, the cryptocurrency market can bring traders a lot of profit even with really small investments thanks to its volatility. You will have to take in count the fees you pay for each trade and consider that the bot will place a lot of orders.
🔎 How to choose the best trading bot for Binance?
There are several key points you will need to take in count while picking your perfect solution. One of the most important features, perhaps the most important one, is the reputation of the service. We talked about the possibility of services to get compromised so this point is extremely important.
Always make sure you are using a service with a good reputation and reviews. Using a third-party tool means giving it access to your Binance account through your API key. Choosing a developer who has a good reputation is essential since there is no easy way to tell whether a trading bot will be completely safe or not.
The UI (User Interface) is also really important, you will often find platforms with very congested interfaces with way too many features. It’s important to pick a simple yet effective interface. Trading bots will often have enabled an extensive amount of strategies, most of them offer a few well-known algorithms but is important to have the option to create your own strategy.
It is extremely important to make sure the service allows you to backtest strategies. Backtesting grants you the ability to run the script using past data and it’s the safest way to test and check how your strategies work.
Another important feature is the statistics. Some trading bot services will offer a wide variety of stats while others will simply show you losses and wins.
User support is also crucial, ideally, you would want 24/7 support service in case an error or bug occurs.
Another good feature to have is the ability to run multiple scripts. Free services will often only allow one or a few trading bots, paid services allow even an unlimited amount, which is extremely helpful if you want to trade with multiple pairs simultaneously.
If you want to pick the best Binance trading bot, then feel free to check our unbiased cryptocurrency bot reviews.