What is Copy Trading in Crypto? How to do Copy Trading

Now that we understand the importance of optimizing the risk-reward ratio, let’s focus on another crucial aspect – building a copy trading investment strategy. BitDegree Learning Hub aims to uncover, simplify & share Web3 & cryptocurrency education with the masses. Join millions, easily discover and understand cryptocurrencies, price charts, top crypto exchanges & wallets in one place.

• BitMEX is a crypto trading platform that lets you trade Bitcoin and other cryptos with different products.
• Essentially, it enables individuals to copy the trading strategies of successful traders within the crypto market.
• In the world of cryptocurrency, copy trading crypto has emerged as an innovative and increasingly popular investment strategy.

Multi-strategy bots utilize different trading styles depending on the market conditions. They can be considered a multi-tool, rather than specifically requiring certain market conditions. Copy trading provides an excellent entry point into the world of crypto trading, whether you’re a complete beginner or someone with a bit of experience. Sure, success is a wonderful thing, especially when you’re piggybacking off of someone who has done the heavy lifting for you. What happens when the trader that you’re following encounters a flash crash, a sideways market, or even a bear market? If you think that another FTX can’t or won’t happen, then think again.

Risks and Rewards of Copy Trading in Crypto Market

You can track your copy trading results and performance on the platform. You can also see more about each trading strategy, like the trades they made, the profit and loss, the fees, and the minimum amount you need to copy. Consider putting your settings, like stop-loss, take-profit, and maximum amount. With the feed feature, traders can now post their – speculations on future trends and insights, thus encouraging interactions between copy traders. BingX’s copy trading system also supports DeFi, NFT, indices, commodities, forex, and Layer 2. In order to display traders’ performance in a more comprehensive way, BingX traders can now enrich their homepage by accessing another exchange’s API.

• Now there is no end to the number of platforms that offer copy trading (social trading), but like always I will make your search easier by suggesting only the best copy trading platforms.
• Currently, it’s not allowed to configure auto trading bots at our platform.
• The platform offers over 150 crypto assets, has over 3 million global users, and is one of the few derivatives platforms that offer an automatic copy trading system.
• If you are a pro-trader, you can offer your service via these social trading platforms and earn a profit when people copying your trades make a profit.
• There are so many crypto copy trading platforms that picking the right one could be quite demanding for an amateur trader having little knowledge about the domain.

They have access to segregated accounts at top banks, secure deposits, withdrawals, competitive leverage, and tight spreads. You can trade over 250 instruments and have access to a range of optimized accounts and platforms. There are also exciting forex contests and trade-enhancing bonuses. BingX is a leader in the industry with no deposit fees and the lowest fees. It offers all these features of a regular crypto exchange and seamless crypto derivatives trading. It is an all-encompassing platform that can meet all your trading needs.

Everything You Need to Know About Crypto Copy Trading

Many of these providers will advertise high win rates on social media or try to lure you in using advertisements on YouTube. Not only should you make sure that the traders you copy have a solid risk management system, but you should also limit your risk per crypto trading app trade you copy. For example, you could choose to only allocate 3% of your funds to a certain trader or use a stop loss when the trader goes more than 20% into drawdown. At the time of writing this resource, Binance does not offer the social trading feature.

• The feeling of syncing your trades up with somebody else and then watching both of you succeed makes trading more intimate and connective.
• These features give you more control and help you adjust your copy trading strategy to your risk level and goals.
• You can deposit funds on eToro via various methods, including PayPal.
• After a standard KYC process, simply add funds to the Trality Wallet using a preferred funding method, whether by credit card, bank transfer, Apple Pay, or Google Pay.

In conclusion, copy trading crypto provides practical benefits such as access to the expertise of experienced traders, diversification opportunities, and time-saving convenience. However, it should be approached with caution and complemented by proper research and risk management. By leveraging the advantages of copy trading while remaining informed and discerning, investors can potentially enhance their cryptocurrency investment journey.

eToro

This type of trading provides less flexibility than social trading, as you are expected to follow the strategy blindly. The only choice you have is what strategy to use and when to stop using it if you do not like it. The process of copying another trader’s trades is known as “copy trading.” Instead of replicating a strategy, you replicate every action of the trader – you have chosen to emulate. Manual copying can be accomplished by making the same trades as the chosen trader. One might question how they will be able to get insights into the performance of various traders. It is to find all required information on typical copy trading software as traders willingly consent to give member traders access to their trading moves.

• But if you perform copy trading with good knowledge and proper research, you can definitely make some money.
• This enables one to buy and sell crypto assets to earn profits without putting in a lot of time for researching or gaining proficiency in crypto trading.
• The lead traders themselves are paid a small fee for allowing their trades to be copied.
• Once again, eToro is the perfect example here – the brokerage functions like such as platform already.

This copy trading software automates buying and selling of crypto assets by mitigating the original trades of professional traders. In the world of cryptocurrency, copy trading crypto has emerged as an innovative and increasingly popular investment strategy. This approach allows novice investors to capitalize on the expertise of seasoned traders by automatically replicating their trades in real-time. Essentially, it enables individuals to copy the trading strategies of successful traders within the crypto market. One surprising recent example involves newbies trading investment tips on TikTok.

Is Crypto Copy Trading Profitable?

Of course, if shorting and dealing with futures is your cup of tea, then, by all means, follow a trader who does this. Or they may be a big fan of shorting, which is where an investor borrows an asset and sells it with the expectation that the price will drop. They then buy the same number of the asset back at a lower price, return the shares to the lender, and profit from the rest. Since it’s powered by Binance, the Trality Wallet is built on the industry’s safest and most secure custodial wallet infrastructure. Any and all funds deposited into the Trality Wallet are backed by Binance.

• But it also has some challenges, such as finding trustworthy and compatible traders to follow, controlling your risk level, and keeping up with market changes.
• The process of copy trading is usually done automatically, with the platform executing trades on behalf of the investor, based on the trades of the chosen trader.
• Nowadays copy trading is one of the most popular features for traders (according to the research in BeInCrypto Trading Community) and many exchanges offer such functionality to their users.
• Automation provides a special peace of mind in knowing that your actions and decisions will be synced up even when you are asleep or busy yourself.
• Ultimately, whether copy trading is right depends on your preferences and risk tolerance.

EToro is also quite popular, which you can explore along with PrimeXBT. There are a few important things to keep in mind before you get started with this strategy. On the other hand, the people who choose to follow you have made that decision on their own accord, and so it is their choice to expose themselves to your actions.

Follow Us

BYDFi offers a demo mode that allows you to make practice trades using real market statistics. Now there is no end to the number of platforms that offer copy trading (social trading), but like always I will make your search easier by suggesting only the best copy trading platforms. So buckle up to learn something new and start earning from trading even when you have no prior experience in trading. You’re leaving the hard work of choosing investments up to someone else. You can earn returns in your portfolio without having to invest hours researching the market. Diversification and risk management are also done for since the pro trader is the one directing investment decisions.

Coinmatics copy trading service allows copying deals made by traders and trading bots, as well as receive signals from verified strategies. FXTM is a global network and has more than two million clients from 150 countries. It offers outstanding online trading services to retail clients.

Holistic and long-term view of cryptocurrency copy trading

In addition to spot trading and derivatives, the global platform offers bridges, cloud services, mining, loans, and copy trading. On their page, you will see all the details of your copy investment. As always, it is important to do your own research before investing your hard earned money; never invest more than you can afford to lose.

• Overall PrimeXBT Covesting platform is one of the top social trading platforms out there, and something you as a beginner might like to start with.
• All forms of trading come with their own risks and rewards, and this is important to know when learning what is copy trading in crypto.
• The biggest drawback of this trading method is that you need to constantly monitor the market’s flow and decide on individual trade trends.
• We see a growing popularity in copy trading, which would not be happening if people were losing money.
• Trading is risky and letting other people do it for you may do more harm than good.

Crypto asset investing is highly volatile and unregulated in some EU countries. Another reason is that your social status and creditability can skyrocket by helping people copy trade. For people who want to become a well-respected trader, this is great. The most important takeaway is that copy trading can happen even on exchanges that do not have the tools built in. This is great news as it means you can freely choose whatever exchange you are most comfortable with, and that you enjoy trading on the most.

Trality’s Marketplace and reversion strategies

It creates a type of democratizing of knowledge and experience; those who are viewed at the top of the trading strata are offering their insights to others by making their trades known. It makes for a more horizontal experience, where those who know the most help those who are just starting out. It would be useless to learn about what is copy trading in crypto if you never learned how to do it efficiently and effectively. This might sound strange, as in many ways you are not making most of the granular decisions, but rather another party is. For this reason, it is easy to assume that your success comes almost entirely from another person. Once you have picked your trader of choice, and set up either the API or the platform you are using, you will then start to see your trades sync up with your target!

• EToro is one of the best copy trading platforms, and it offers a wide range of assets (Forex, crypto, commodities, stocks, ETFs, and indices).
• He is adept at crafting news and informational content for the crypto space and has experience writing for other niches.
• Because of the algorithmic nature of trading, it also runs 24/7 and is not affected by emotions.
• Traders can also make mistakes, experience market volatility, or engage in fraudulent activities.
• Crypto copy trading enables traders to replicate the trades of expert traders and get over the steep learning curve.

Fast and helpful customer service can help you solve any problems or questions you may have. It supports more than 20 cryptocurrencies, like Bitcoin, Ethereum, Ripple, Litecoin, Cardano, Dogecoin, and more. You can deposit and withdraw your money using different methods, like credit cards, bank transfers, e-wallets, and crypto wallets.

Enhances Your Trading Knowledge

It will copy the trader’s orders on your account as soon as they happen. You can show off your trading strategies and attract more followers and copiers. Earn 10% of the profits from each copier, plus an extra 2% from OKX.

• The simple fact is that most people don’t have the requisite skills and experience, which is why most people aren’t professional traders.
• It offers outstanding online trading services to retail clients.
• That being said, brokers such as the aforementioned eToro mitigate these issues and concerns, to an extent.
• The outbreak of the coronavirus, or the terrorist attacks of Sept. 11, 2001, are good examples of these events, which caused large losses for many traders.
• Here you will see all the pro-traders, and you can pick a trader to copy based on their performance and statistics.
• Another crucial aspect is monitoring and evaluating the performance of the traders you are copying.

It has over 20 million users around the world and it follows the rules of the FCA (UK), CySEC (Cyprus), and ASIC (Australia). Check and analyze their performance, risk level, and trading history before you copy them. If you want to copy the trades of other traders, you can sign up as a copy trader on OKX.