Beginner’s Guide to Crypto Trading Bots — Part 2 — Trading Pairs
Defining Your Trading Assets. Do I want more Crypto? or More Fiat Currency? That is the question.
Defining Your Trading Assets.
Do I want more Crypto? or More Fiat Currency? That is the question.
What is Your Goal?
1) Accumulating More Crypto?
OR
2) More Fiat Currency?
When I first started testing crypto trading bots, this enormous detail was not immediately obvious to me.
I guess I had assumed that any trading bot was going to accumulate MORE crypto for me.
WRONG.
The trading pair matters!
Did you know that second asset in any trading pair is the target asset for accumulation??
3 years ago, I didn’t.
USDT pairs — Gimme That Fiat Baby!
The primary purpose of ANY crypto paired with a stablecoin such as USDT, or USDC is TO INCREASE YOUR STABLECOIN BALANCE.
BTC/USDT
ETH/USDT
LTC/USDC
etc etc
When you pair against a stablecoin, you are focusing on accumulating more of that stablecoin, NOT the crypto you are trading against.
When I started trading with bots 3 years ago — I wanted only to accumulate my crypto and to do so in a way I could monitor. Yet I was running USDT pairs because I didn’t know any better.
Oops!
I realized after a while that this was ok after all, and that I would focus on increasing my USDT balance first!
Now that I have 4 of these bots running, I am using two of them to feed HODL balances, and I just started testing bots on those balances using crypto/crypto pairs — which changes the purpose of the bot entirely!
Crypto/Crypto Pairs — Gimme That Crypto Baby!
The primary purpose of ANY crypto paired with another crypto, is TO INCREASE A CRYPTO BALANCE!!!
ETH/BTC = increasing your BTC.
BTC/ETH = increasing your ETH.
Crypto/Crypto pairs are the pairs you want to run. They will allow you to arbitrage with the main goal of accumulating more of your target cryptocurrency.
This goal is slightly more mentally complicated if you keep your mind clouded simultaneously by comparing the value of the assets in your native currency.
Comparing BTC to ETH without also referencing USDT (or your own native currency) is hard.
You aren’t focusing on the USD value at all here, you are trying to fill your bag with your desired crypto with the goal of continual increase for a LONG TERM POSITION.
If we remove all comparison to native currency value from our heads— now running this kind of pair on a bot makes more sense.
The sooner you have that light bulb click on and you stop worrying about what the fiat value translates to, the better.
HOWEVER, WARNING — I ONLY DO THIS ONLY BTC, LTC, ETH.
I call these the Triforce of Crypto — they are the originals; large and trusted, highly liquid, and they have a very reasonable expectation of continued existence + increase without taking scorched-earth level hits to their market cap / price that many smaler cap Altcoins do.
If you are comfortable with other Altcoin crypto holds, you can easily trade for those as well. Trade with Caution!
Click Below to Continue to Part 3 of this story series :
Disclaimer : This is not financial advice and I am not a financial advisor. This is just what I am doing with my own money. I am NOT an expert. I am some dude on the internet who sees a path sometimes, and takes it.
Thank you for reading!
Until next time….
Onward and Upward Everybody!
-Chris
Automated Income Lifesyle w/ Chris Morton YouTube
#botlife #bots #cryptotradingfrenzy #cryptolives #beyondfiat #exchange #trading #etfs