Why Crypto Investors are Switching to Automated Trading

Jun 2, 2022 | Insights

Why crypto investors are switching to automated trading

Automated trading has become more and more popular over the last year compared to the traditional manual ways of the world — now people are finally wanting to put their trust in something that’s already proven to work and save themselves a headache.

What is Automated Trading and How does it Work?

The crypto market is still in its early stages and highly volatile, compared to its counterparts, which can sometimes make it difficult for investors to determine the right time to enter and exit a trade as well as figure out their risk factors/target profits/stop losses etc. This is where automated crypto trading comes in handy. Algorithms can monitor the market across a multitude of exchanges and execute trades based on predefined rules and strategies that have been set by their developers. Not only pre-defined rules though, platforms that have a solid team and know how to create dynamic and AI algorithms mean fully-optimized performance no matter the state of the market. Automated crypto trading can be a game-changer for the future of crypto financial markets. It will allow investors to trade on their own schedule without having to worry about missing out on opportunities because they are sleeping, at work, or away from their computer doing things they actually enjoy, rather than staring at charts.

Automated trading is a system that automatically executes trades on behalf of a human trader. It was mostly used by large financial institutions and hedge funds that have substantial capital to trade with. Now it’s time to bring it to the masses and help the ‘small fish’ out by giving them access to the same tech with the likes of minty. This type of trading has been around for decades but it has seen an increase in popularity in the last few years due to the rise of cryptocurrencies and their volatile nature. The most common type of automated trading is algorithmic trading, which uses mathematical algorithms and artificial intelligence to learn and make predictions about markets based on historical and real-time data. This is done without human intervention, which means that it doesn’t require any knowledge in finance or investing. It’s a highly profitable investment tool because it can be used by literally anyone with an internet connection and some crypto to invest, as long as the platform or fund they join is reputable.

You mentioned a fund, what’s the deal with that?

Mutual funds are often marketed as a way to get the benefits of diversification while reducing the risk of investing in individual stocks. But they can also be expensive and come with high fees.

Crypto funds, on the other hand, have lower fees and offer a more hands-off approach to investing in cryptocurrencies. They are a good option for those who want to invest in crypto but don’t have time or expertise to do so on their own.

By joining a crypto fund you are able to simply deposit your crypto into a shared pot which the platforms dip in and out of for trading. Add automation to this and you have something really powerful that is capable of trading across thousands of pairs and a considerate amount of exchanges — something a manual trader or even standard trading bot users cannot compete with. The beauty is that all profits are shared between everyone equally — the low fees being even more of a bonus.

minty takes this one step further by removing what most funds call ‘time-locks’ meaning that its users are able to withdraw their balance at any time, any day, without any human intervention.

What is the Future of Crypto Investment Scenarios?

The future of crypto investment is in the hands of machines. Investment automation platforms are being used to analyze the market and make investments on behalf of traders. Some companies with AI investment strategies will use machine learning to predict the market trends in order to make profitable trades.

In the future, most trading will be done by machines and not humans. The majority of us are far too emotional to day-trade which brings us on nicely to the next part.

Trading psychology: how emotions can ruin our performance

Trading is a game of emotions. The more we try to suppress our feelings, the more they will be present in the trading process. Emotional trading is a concept that has been discussed for years, but it has only recently been researched extensively. One of the most insightful studies was conducted by Gregory Noronha and his team in 2015. The study found that there are five key personal risk factors that can lead to negative emotional trading:

1) lack of self-awareness

2) lack of understanding

3) lack of knowledge

4) lack of control

5) lack of resilience

By not being in control of your emotions whilst trading you are at risk of losing money. It is important to be aware of your emotions so that you can make the right decisions under pressure. For example, if you don’t have a solid strategy and have seen Elon Musk tweet about some crypto coin called DOGE, or have seen a million posts flying around social media about LUNA — you dive in and long/short the coin to then find yourself staring at a -80% PnL after something silly like 5 minutes. You panic and close your position at a substantial loss.

You could also have the best strategy in the world and enter a trade, set your target profit and stop losses, watch it like a hawk and still cave into emotions. Investors with ‘paper hands’ will often panic and close positions at the slightest sight of a drawdown or red text with a minus sign.

This is why people are starting to put their trust and parts of their portfolios into automated platforms such as minty. It removes 100% of trading psychology and emotion. The only thing you need to do is add to your balance and then let the algorithms handle the rest.

minty does exactly this — we aim to give our community peace of mind, knowing your portfolio is being looked after around the clock does have a sense of relief! Not to mention our low fees compared to other platforms — talking a mere 14% — to better that, our fees only kick in on profitable trades, generous aren’t we…

Get started and become a smarter investor with minty today! Our algorithm-led, automated, simple and emotionless platform.

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