Why do traders use Bitsgap over other crypto bots?


Why do traders use Bitsgap over other crypto bots?

As of today, cryptocurrency trading has become extremely popular due to a low investment threshold and a 209% 9-year compound annual growth rate with a fundamentally zero long-term correlation to traditional assets. Trading 24/7 is in fact exhausting and quite stressful due to the cryptocurrency market volatility. In this market, algorithmic trading is the solution to achieve high-frequency trading and profit maximization. Automated trades execution is programmed to follow a set of pre-defined trade rules, which allows you to stay away from a computer as you are no longer required to set orders manually. In this article, we are going to compare top cryptocurrency automated bots in terms of performance transparency, usability, configuration simplicity, and quality.

Performance transparency

In trading, transparency stands for a valid and trackable performance. It is a prerequisite for being able to monitor trading and portfolio management dynamics. That is the only possible way of how you can optimize your strategies to achieve better results.


For instance, Bitsgap allows its users to not only track all of the trade executions on a chart and in a “Completed orders” section of currently active bots, but to check the historic results of all closed bots. Such transparency allows traders to spot concrete mistakes to avoid in the future and to reveal the best performing strategies to continue working on.

For example, the chart below is a BNB/USDT pair with only 28 grid levels setup. As you can see, many buy limit orders are left behind the upside momentum. If there were 50+ grid levels then in this occasion limit orders would be narrowly distributed having more chances of being triggered by the price swing.

Bitsgap bots are working with a grid investment distribution logic, which is a proportionate capital allocation by many limit orders. This technical approach maximizes the return on an upward trend, sideways trend, and minimizes losses on a downtrend. Most importantly, Bitsgap has implemented key metrics like “Investment Change” to estimate how much you invested in the bot and how much your investment plus a bot profit is worth right now, in the form of the quote currency.

The “Bot Profit” metric calculates the profit in a quote currency generated by the bot. All metrics at Bitsgap are net of all exchange fees, and on the screenshot below you can see the profit netting in a “Completed orders” section:

Other platforms like 3Commas and Bituniverse do not take fees into account when calculating the profit. That means that they do not provide a net profit, and hence your actual return is much less than the value displayed.

(3Commas fees excluded example)

Optimization and testing

  1. BacktestingBacktesting is one of the key components of any automated trading. The idea is to simulate a trading algorithm using historical data to analyze risk and profitability before risking any real capital. In other words, backtesting discovers how the bot would play out using historical data. In cryptocurrencies trading, volatility can be both dangerous and profitable as the market is moving sideways. With backtesting, you can choose a list of optimal cryptocurrency pairs that comply with your risk and return preferences.

    Let’s use Bitsgap’s backtesting instrument to compare two cryptocurrency pairs for a period of 1 month starting from the 11th of April to 11th of May: ENJ/BTC and BNB/BUSD. According to the backtesting result, ENJ/BTC has achieved a 34.46% bot profit having upside volatility of 66.76% and 34.35% of downside volatility. Whereas BNB/BUSD has achieved a 3 times lower return, 13.37% bot profit, having twice lower upside volatility of 35.51% and much lower downside volatility of 23.4%.

    BNB/BUSD chart

Cryptocurrency

Bot profit

Downside risk

Upside momentum

ENJ/BTC

34.46%

34.35%

66.76%

BNB/BUSD

13.37%

23.4%

35.51%

Difference:

21.09%

10.95%

31.25%


Here is a table for you to spot the difference. ENJ/BTC has a 21.09% profit outperformance, but the price for that is an increased downside risk, which is higher by 10.95% in comparison with BNB/BUSD. Let’s calculate the risk to return ratio to compare cryptocurrencies. We must divide Bot profit by Downside risk. ENJ/BTC has a ratio of 1%, whereas BNB/BUSD has 0.57%. Clearly, ENJ/BTC offers a better return for a given risk than BNB/BUSD.

Rational traders and investors are looking for investments, which offer a risk to return ratio higher than 1%.

Platforms like 3Commas and Bituniverse don’t have backtesting. Users don’t have an opportunity to stress-test cryptocurrencies before entering a trade. This is a glaring omission.

Cryptohopper has a limited backtesting deployment. However, only a few coins are available and settings are quite complicated for beginners to use.

  1. Trial period and Demo trading

Some companies still underestimate the importance of trial periods. Having a very limited period to test a product can be not enough for users to learn about the major features and hence there is a small likelihood to have them converted to paid users. Not having a trial period at all, especially when it comes to such a narrow market segment as automated trading is the biggest mistake. The solution is to provide users with an optimal trial period with a demo mode so that they could make step-by-step due diligence without any rush. Demo trading allows you to make trades without risking any real money. As a result, you end up discovering your own trading style and then you can start trading with real money!

In the cryptocurrency market, there is a very short list of companies that provide trial periods and even a shorter list that offers adequate trial periods:

3Commas offers only a 3 days trial period to test all of its major and distinct products: GRID bot, Futures trading, Composite bots, Simple bots, Short and Long algorithms, TradingView signals, Trading terminal, other bots. That’s a ridiculously limited period of time to test that many complex products. The only good thing is that demo trading is opt-in all of the subscription plans.  

Cryptohopper offers a 7-day trial period to test all of its 5 major features. This looks like a more or less adequate trial period in comparison with 3Commas. In addition, a demo mode (paper trade) is provided but for only a limited time.

Bitsgap certainly stands out as it offers a 14-days trial period for all of its subscription plans. Notice that a free plan of 0$ per month is also provided, which is only limited to a $1000 monthly volume. Demo trading is included in any plan, the same as in Cryptohopper and 3Commas.

 

As we mentioned demo mode, now let’s compare  

Usability and Configuration simplicity

User-friendly configuration settings and simple guidelines are essential when it comes to the product introduction. In case if the product’s configuration is overcomplicated and looks chaotically disordered, who would stay? The rule is “Simplicity is the ultimate sophistication” (Leonardo Da Vinci).

Usability stands for the ease with which users can complete tasks in the interface and the speed with which users can complete tasks the first time they encounter it.

Bitsgap platform has one of the simplest interfaces, which is easy to understand for the beginners who have never even traded before. On the very top of the screen, there is a panel with all of the products currently provided. Both a “Simple” and “Advanced” automated bot configurations are built-in. Learn how to optimize and create bots with a simple and automatically defined trading setup before jumping to the “Advanced” section, which has some of the advanced level trading features like “Trailing up”, “Stop Loss”, “Backtesting”. All of these features are available starting from the Basic subscription and in a 14-days free trial period.

In comparison, in BitUniverse to get full access to the platform or at least to take a short glance at its interface you are literally obliged to attach the API of any of your exchange at the very beginning of the registration. You can’t skip this stage. Otherwise, a very polite lady will insist on watching the instructional video on how to create an API and API secret key to connect with an exchange.

For the sake of the experiment to see the difference, let’s try to launch an automated trading bot, which is built on a grid trading mechanism, using the same trading settings on a BTC/USDT pair on Bitsgap and 3Commas platforms:

Upper price: $9945.45

Lower price: $8217.12

Grid quantity (amount of limit orders): 60

Investment per Grid: 0.001373 BTC

Investment: 700 USDT

Stop-Loss: in this example only available at Bitsgap

Trailing Up: in this example only available at Bitsgap

As you can see, 3Commas has a quite overcomplicated “Open orders” and a trade specification illustration, which can be misleading for beginners. Moreover, neither Stop-Loss nor Trailing instruments are provided to optimize trading. Grid levels setup is available only in a manual mode. You can’t adjust grid levels on a chart, which would be way simpler and quicker.

On Bitsgap everything looks straightforward and easy to understand even for a beginner trader. By clicking on a “View” button, once the trade appears in the “Active bots” section, you can get a full spectrum of currently open trades (price, amount, side, date). Most importantly, both Stop-Loss and Trailing instruments are provided for traders to have a risk and profit maximization under control. In case if you forgot to switch on a Stop-Loss, you can always do that later. Grid levels displayed on the chart can be adjusted manually by simply dragging the upper and the bottom limit price levels in any direction you want.

We can also compare Bitsgap with BitUniverse to spot the difference:

Bitsgap has 3 bot adjustment options:

  • Chart manual adjustment (you can drag an upper and bottom limit price levels)
  • Manual adjustment (you can type in price levels accordingly)
  • Automated adjustment (if the balance is insufficient to launch the bot, the system can adjust grid levels to provide an optimal strategy for a given investment value)

In comparison with Bitsgap, Bituniverse has a quite primitive manual setup in which you have to type in the numbers without any built-in support buttons like “+”, “-” or pre-set numbers. This can be quite time-consuming and by the time you finish the last input, the market price can change and you will possibly reconsider typing once again with new input numbers.

What makes Bitsgap and Cryptohopper stand out is that both have recommended automated trading strategies to offer. For instance, on Bitsgap recommended strategies can be instantly found under the “strategies” section. These are the strategies that offer a great return for a given level of risk. Users can backtest any of the strategies provided to validate the performance.

Cryptohopper follows a completely different approach. It has created a marketplace of automated trading strategies so that users would have a variety of options to choose from. However, the biggest disadvantage is that trading performance stats are not provided. The strategy’s dynamic is intransparent. That is what we call a “cat in a bag”. First, you have to buy a strategy to see the stats. How can you buy something you can’t even see to analyze and compare with the rest of the options?


  • Visualized trade executions
  • Performance transparency
  • Optimization and testing (Backtesting, trial, demo)
  • Usability and configuration (risk management, auto and manual strategies)

Platform

Performance transparency

Optimization and testing

Usability and configuration

Backtesting

Trial period

Demo trading

Risk instruments

Recommended strategies

Manual settings

Bitsgap

+

+

+

+

+

+

+

3Commas

+

+

+

+

BitUniverse

+

+

+

+

Cryptohopper

+

+

+

Limited

+

Marketplace

+

Author: Guest Author
This author could be anybody, but he/she is not a member of staff coingape.com and opinions in the article are solely of the guest writer and do not reflect Coingape's view.
Post your comment...
Guest Author 554 Articles
This author could be anybody, but he/she is not a member of staff coingape.com and opinions in the article are solely of the guest writer and do not reflect Coingape's view.
Follow Guest @