Automate crypto trading: build, backtest, optimize, execute

FAQ

• What's the difference between backtesting and paper trading?

  Backtesting simulates trades on historical data instantly. Paper trading simulates trades in real-time using current market conditions.

• How accurate is backtesting — can I rely on it to predict future performance?

  Backtesting is only as accurate as the data and logic you use. While it can’t predict the future, it shows how your strategy would have performed in past market conditions — and that’s your best starting point for risk control and refinement.

• Is a crypto trading bot profitable?

  Automated bots assist users in more effectively allocating their resources by implementing and fine-tuning various strategies. Users must determine what trading strategy to configure the bot with. This includes developing a set of rules for how the bot selects prerequisites for the timing and commands to execute the operation. The bot will always operate following the chosen strategy, which will define the level of success users may achieve. Before applying the strategy, we recommend practicing by using a demo account.

• How do bots trade crypto?

  Bots automate the actions that a user would typically perform manually. They rely on triggers, also known as signals, to tell them when to execute the buy and sell commands based on the conditionals users specify. These signals monitor coins' price movements based on API connections with the crypto exchange and then follow user commands when market conditions are met. It is possible to use multiple signals to create complex trading strategies that are very difficult to execute manually. Common trading bots are DCA bots, Grid bots, Futures bots, Options bots, Arbitrage bots, and HODL bots.

• Why should I use bots to trade crypto?

  Using a cryptocurrency trading bot is the best way to trade crypto if you plan on doing anything other than buying and holding. The bots are constantly active, executing your strategy around the clock, freeing you from the burden of manually entering numerous commands on your computer. Using a Bitcoin trading bot, for example, allows you to automate buying the lows and selling the highs when the market is dynamic. Using bots allows you to have your assets working for you to seek opportunities and increase the value of your portfolio rather than sitting in storage.

• How much can you earn with crypto bots?

  If traders use the right strategies and settings, they can achieve significant portfolio growth through bitcoin or altcoin trading. Much depends on trading experience and strategy. With more aggressive trading, the income is higher, but the risks are correspondingly higher. With calmer trading, the income is lower, but the risks are correspondingly reduced. New users will likely experience lower success percentages as they learn more about how to do technical market analysis and how to fine-tune their bots to get better performance.

• Does automated trading work better than buying and holding?

  Automated trading has already been proven to work over the course of millions of trading bots. The key is choosing a reliable strategy and trading software that features cryptocurrency trading bots with proven track records. The software should also be very transparent with performance data so you have the information you need to create a solid trading strategy.
  
  There are many market conditions where holding is not a viable strategy. If the market is rapidly declining, a strategy for selling assets and then buying them back at a lower price can result in significant gains for the user's portfolio when the market recovers. When the market is flat, a Grid bot can take advantage of daily fluctuations to potentially grow the user portfolio slowly over time rather than having your coins in cold storage doing nothing. 3Commas provides technology that enables the use of the buy-and-hold strategy and the automatic trading approach. The user chooses which strategy to use.

• How do you set up a crypto bot?

  To set up a bot, a user needs to make several key decisions. First, the user must decide on the type of bot to use. Then, link a crypto exchange account to 3Commas with a limited scope of permissions. Finally, the user configures the trading rules and selects the strategy for the bot.

• How much does it cost to use bot-trading tools?

  Most crypto trading softwares offer a free option that includes 1-2 DCA or Grid bots. This is a low or no-cost way to learn the software, but most traders will want to upgrade to a paid plan that offers more bots so you can execute your trading strategies more effectively. Typically, you can sign up for paid subscriptions using a credit or debit card or even pay with Bitcoin, Ethereum, or some other stablecoin or altcoin. 3Commas has three types of subscription plans: Free plan, Pro plan and Expert plan.

• Why can’t I get a paid subscription plan on 3Commas?

  There may be an issue with the payment method, in which case it is necessary to contact our support team for assistance. 3Commas is not able to offer any kind of paid service, including 3Commas subscription plans, to users who are residents of countries that are currently on the sanctions list for the European Union, or other nations and international organizations listed under Section 26 of our Terms of Use (Client Terms of Use)

• Does 3Commas have an AI trading bot?

  Our AI Grid Bot increases customer asset safety and tries to eliminate the potential for liquidation risk. By combining AI with a proven grid trading strategy, we created 3Commas AI Grid Bot that trades autonomously, buying low and selling high, while constantly modifying positions to potentially maximize returns and minimize risk.

• What markets can 3Commas tools be used on?

  For 3Commas bots, market conditions are not a limiting factor — they can operate in both bullish and bearish markets. Bots such as DCA and Grid adjust based on the user's settings and strategy. The Signal bot can be integrated with TradingView, where user-defined strategies or indicators are already configured.