Trading cryptocurrency using a bot could be the new golden era. With the expansion of the online cryptocurrency market and easier access to buying and selling systems, cryptocurrency trading is an excellent way to make some extra money.
Trading cryptocurrency using a bot. You can make (or lose) money while you sleep
With a crypto trading bot, you can easily make or lose money while you’re at work, you’re sleeping or you’re doing whatever you want. Algorithms and automated trading bots can be a great exercise for developers and also why not, a way to round something up at the end of the month. But you need to be a really top developer to do this, so we’ll use a pre-built bot to make fun auto trading.
“My account balance ballooned exponentially. I literally turned that $500 into $150,000 in 8 months. Coinbase told the IRS I grossed $62 million in trades, and they were correct! My tax bill ended up being higher than the average American income.”
You probably already know that the stock market and anything related to that type of financial assets is heavily regulated. With licenses, certifications and many other obligations required by current regulations.
So, we’ll trade higher risk cryptocurrencies but without obligations of any kind because the cryptocurrency markets are not yet heavily regulated and platforms such as Binance, Bitfinex, Kraken, and others provide an excellent opportunity to start developing and fine-tuning trading models.
Zenbot, the crypto bot we are going to use here, started out years ago, as a little hobbyist challenge and last year, the version 4 was released as a full-featured app competing directly with professional and commercial trading bots.
Zenbot is one of the major success stories in open-source and gained a top level of community support: too many contributions and too many talented people contributed to Zenbot on Github.
***WARNING!!! – Do not use money that you need, do not invest money you cannot afford to lose!!!***
The bot we are going to use provides a ‘paper mode’ that only simulates trading with real data but without using real money. If you haven’t money to lose, you should only use the ‘paper mode’ and not use real money.
Making Linux machine an automated trading cryptocurrency bot with opensource software
I used both Ubuntu 18.04 on a laptop and Ubuntu 16.04 on a headless server to test this bot, but you can easily adapt the instructions to many other systems. You can also use VPS or other online servers to implement your own crypto bot to make trading cryptocurrency using a bot. If you find some issues or problems, just ask in comments.
Other useful warnings:
- The crypto trading bot is NOT a pure profit machine. Use it AT YOUR OWN RISK.
- Cryptocurrencies are still dangerous. Both the crypto and the bot may fail at any time.
- Running a bot, and trading, in general, requires careful study of the risks and parameters involved. A wrong setting can cause you a major loss.
- Never leave the bot un-monitored for long periods of time. The bot doesn’t know when to stop, so be prepared to stop it if too much loss occurs.
- The unofficial mongodb package provided by Ubuntu is not maintained by MongoDB. You should always use the official MongoDB mongodb-org packages, which are kept up-to-date with the most recent major and minor MongoDB releases. I used both the official and unofficial, the results were the same. So, if you want the latest MongoDB, please use instructions from official website.
First, we need to install Node.js and MongoDB into our system.
$ sudo apt update
$ sudo apt install nodejs
$ sudo apt install mongodb
Clone the Zenbot repository:
$ git clone https://github.com/deviavir/zenbot.git
Create your configuration file by copying
$ cp conf-sample.js conf.js
conf.js adding your exchange API keys to enable real trading. I suggest you to use Binance as exchange for trading with the bot due to lower fee. You can also add Telegram notification and http server for Dashboard. All the parameters are well explained in the
Finally, install the dependencies:
$ cd zenbot
$ npm install
$ # optional, installs the `zenbot.sh` binary in /usr/local/bin:
$ npm link
Now, you can run your auto crypto trading bot:
$ # to run 'paper mode' - only simulation and no real money
$ ./zenbot.sh trade --paper
$ # to run 'default mode' - no simulation and real money
$ ./zenbot.sh trade
$ # to run 'tweaked setting mode' - no simulation, real money and tweaked for optimal return
$ ./zenbot.sh trade --profit_stop_enable_pct=10 --profit_stop_pct=4 --trend_ema=36 --sell_rate=-0.006
To do more tweaking or to test different options, you can check all the available options at Zenbot instructions.
- If you get a ‘no DB connection’ error, open another terminal session and launch MongoDB manually, then relaunch the crypto bot.
- If you need a container, you can use the docker container of ZenBot – the crypto trading bot for your learning purposes
Last but not least, remember that trading cryptocurrency using a bot can be fun, but you can also lose real money, a lot of real money, so my suggestion is to use the simulation mode for a long time to understand how to use the bot and if it can be profitable for you. And never use money that you can’t lose!