When trading Bitcoin, users will usually have two options- manual trading or automated trading.
Automated trading platforms are exactly as they sound- they execute ‘actions’, such as buying or selling on your behalf so you won’t have to spend as much time on-screen or speculating. However, they do have some disadvantages as well.
Let’s take a deeper dive into the pros and cons of automated Bitcoin trading.
Automated Trading Advantages
Set and Forget
Once you’ve established an account with a reputable Bitcoin trading platform such as Bitcoin Evolution you can set it to automation by setting a few trading parameters. Automated means you can devote your time towards other endeavors, such as your day job or other side hustle and allow your Bitcoin investment to grow over time.
Actions Done For You
Having a system that’s always on standby is a good thing, since it will execute the actions the moment a cryptocurrency’s value reaches a specified amount. This eliminates having to rush to complete the trade before Bitcoin falls or rises again, thus giving you profits in a very timely manner.
Saves Time
You can save time having to do your research or predicting when Bitcoin and other popular cryptocurrencies will rise or fall. With automated trading you can set to sell if the crypto rises to a certain point, or buy if it falls at the price you want.
Eliminates Guesswork
Emotions are taken out of the picture with an automated process. This, in turn helps you from losing more money than what’s wise, such as holding on to your cryptocurrency when it’s clearly the time to sell. You won’t have to predict or forecast as much and let the system work for you.
Greater Passive Yields
Automated trading offers much more significant gains than other trading methods, such as hodling. You can set it to trade even as you sleep or go about your day.
Automated Trading Disadvantages
There are Scams
Make sure to do your research before putting your Bitcoin in an automated trading platform. It should be well-established, reputable and offer several protective measures, such as encryption and SSL certification. Check online reviews, social media and communities before committing a huge sum of money or Bitcoin.
Stay out of sites that offer unreasonably huge gains, and those that ask for your financial information.
Mechanical Failure
It’s rare that an automated system might fail due to several circumstances, such as server down, lost internet connection and others.
Other times, the system might not recognize the value of Bitcoin and thus won’t be able to complete the transaction. You can reduce the instances of a mechanical failure by reviewing the trading platform before you sign up for an account.