The Rise of the crypto trading bots – how to know yours is legit.
The crypto trading industry is growing and has recently gained much attention and fame. However, amidst this popularity is the additional requirement of time, skill, and knowledge to succeed in the industry.
As the cryptocurrency markets grow more complex, traders need to use the latest tools and technology to succeed. Crypto trading bots are new tools that are taking over the market. However, not every auto trader bot is legit; here’s how you can tell which ones are and aren’t.
The Truth about Bots
If some things are too good to be true, they probably are. So, how can you know if your bot is legit?
The first type in review is API bots. There are undoubtedly great bots out there; however, not all share the same characteristics. For example, reputable bots usually are proud to share their performance results. For one’s who don’t or are unwilling to, that should raise some awareness.
Another thing to note about these types of trading bots is that you’ll need to connect them to a crypto exchange account using an API. This API allows the bots to place trades on your behalf on the exchanges. This will require you to provide access.
Any bot that suggests you give up total control of your account and especially enable API 3rd party “transfers and withdraws” signals red flags.
Also, check the exchange transaction details; fake bots will not execute your strategies.
Creating a separate account with dedicated funds to be used strictly for the API trading bot may be a great way to add an additional layer of security to your funds. At this point, enabling alerts on this account, such as sign-ins, withdrawal requests, and password change requests would also be wise.
With the space being as new as it is, it’s not uncommon to see new companies spring up daily, however, and for the most part, any service provider in this space that has been operating for any amount of time usually has at the very least, has social reviews on them across various platforms.
Still, it’s always a good idea to read through the reviews to see if they are genuine, seem a “bit too” professional, or perhaps like a computer-generated response.
If there are video reviews, keep in mind that they may be sponsored by the said company or have an affiliate arrangement worked out.
Social proof can also include partnerships with larger, more notable companies. Generally, the better well-connected a company is with other companies, especially within the same industry, is a good indicator of credibility.
Researching the partners or sponsors to verify their reputation and track record can also prove valuable. Service providers who have secured partnerships with exchanges should be noted as it shows the exchange holds them in high regard.
Over Promise, Under Deliver
Although cutting-edge and breakthrough technology is what drives this sector, the proof is in the pudding, so to speak, when it comes to results.
Even without being a paid customer, there are multiple ways one can use to help verify the stability of the service provided. Normally, platforms will post outage notices and updates publicly to keep their customers in the know.
While technology is never flawless, this process may shed light on common problems this service provider experiences, how often bugs our outages occur, their downtime, or the time the team takes to attend to and resolve the issue.
If you see a common occurrence in specific outages that tend to repeat themselves, that could also be all the proof needed to declare a platform non-worthy of your business.
Look for platforms that make promises in their commitment to their customers to improve their services and tools and continuously improve with time.
Does the company share a value or mission statement that aligns with you as an investor and customer? If you feel valued even before investing any of your capital into their services, then this could be a promising sign of how you will be treated once onboarded as a paying customer.
Crypto trading bots are here to stay, and they do work. If you are thinking about using one or already d0, always remember that any bot claiming to guarantee you profits may be worth looking into a bit more before choosing them as a service provider.
Using automated trading bots, while undoubtedly more efficient than manual trading, is again a tool that can complement one on their journey to achieving financial freedom or simply growing their accounts.
Expecting bots of similar nature to turn a three, four, or even five-figure account into a seven-figure account overnight is unrealistic.
Wealth is accumulated by making gradual yet consistent wins over time, and using a legit crypto trading bot can help you accomplish that.