If you consider trading in the financial market of a decade ago, you would have known only the financial instruments like stocks, bonds, commodities, and other assets. However, the digital era has brought several advancements to the trading arena also. Now, one can trade with cryptocurrencies that are not even used as regular currencies. However, as the majority of people and governments have accepted the use of cryptos, their values are increasing every day and you can find several cryptocurrencies coming into the market. Since the system is decentralized, the prospects of cryptocurrencies are sky-high. So, they have introduced cryptos in the trading world also. If you wish to trade with cryptocurrencies, you would have to signup with a crypto trading platform like the bitcoin revolution. These platforms will help you monitor the market and buy or sell the currencies for profit. There are two types of crypto trading platforms in terms of advancements as follows,
Manual crypto trading platforms – These trading platforms will closely resemble the brokerages of ordinary financial markets and exchanges. Here, the traders will buy and sell cryptocurrencies according to their wishes.
Auto trading platforms – As the name suggests, these platforms will have a trading bot or an algorithmic system based on programming languages that will help you to execute certain trading activities even without your physical presence.
The concept of auto trading is trending these days and the collection of benefits is making it widely popular. In this article, let us discuss some of the reasons for the wide popularity of automated crypto trading.
Reasons for the popularity of automated trading
Reduction of loss due to emotions
Human emotions have always been the antagonists in trading activities for almost all traders. Regardless of the experience of the trader, his emotions will let him take some unnecessary actions leading to several downfalls. An example will be your decision to sell the cryptocurrencies you have due to the fear of their value falling in the future. Although the fear may seem logical, the sale of the currencies without any solid proof but only due to your fear can give you heartbreaks if their values increase. The same will happen in the cases of buying currencies also. Whenever you change your trading plan because of emotions, you will go towards a loss. However, this will not happen in automated trading, and the losses due to mere emotions will be nil.
Benefits of a single strategy
Similar to decisions based on emotions, several decisions could lead you to losses as you change your trading strategy. It is necessary to stick to a particular strategy for few trades until it is evident that the strategy will not suit the market conditions and your trading style. However, you will change the strategy frequently when you are controlling the trading activities manually. Instead, if you are involving in automated trading, your profits will be high as the process will happen with a single strategy without alterations. Sometimes, the chosen strategy may bring you huge profits in the future. Automated trading will help you get these benefits.
Spontaneous entries
Cryptocurrencies are highly volatile and their values can change to a larger extent within a fraction of a second. If you monitor the markets manually, you may miss certain opportunities to enter the market at the right time. However, the automated bot or algorithm will not be lazy. So, the order will be placed once the market reaches a position pre-set in the algorithm without any delays. So, you can enjoy the benefits of spontaneous entries and exits from the market.
Diversity
In manual trading, it might be confusing to trade with multiple cryptocurrencies at once. So, you may miss some opportunities and face some losses also. However, an automated trading system will reduce the burdens on your shoulders and will let you trade simultaneously in different exchanges and markets without any hassles. So, the profitability is high and the impact of losses in one or two markets will not affect your position.
Non-stop activity
Since the bot or the computer system is working on your behalf, entries and exits are possible 24X7.
