Copy Trading Crypto A Beginner’s Guide to Investing in Cryptocurrency

Written by . Posted in LeveX Unleashes Next-Gen Social Trading Features, Pioneering a Cohesive Crypto Trading Ecosystem 928

EToro is a platform where you can trade and invest in various kinds of financial instruments, including cryptocurrencies. 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. You can choose from 340+ trading pairs and find the best traders to follow.

• BitMEX is a crypto trading platform that lets you trade Bitcoin and other cryptos with different products.
• It is a good idea to test out and interact with the platform using a demo account before beginning copy trading for real.
• To learn about copy trading, one of the most important things to be informed about the actual process of copy trading.
• You can see your balance, profit, loss, open positions, closed positions, etc.
• BingX aims to empower even new investors with the knowledge needed for making the right investments.

Gate.io is a well known crypto exchange that allows users from USA as well. You can join as an investor (to copy other trades) or you can join as a trader, so that others can copy your trades and you can make money. Think of this as running your own hedge fund, and everything is automated.

But, What is Copy trading?

It also fits into the wider ethos around blockchain and cryptocurrency, where transparency is viewed in a positive light. Crypto has always been about pulling the curtain back and showing the world how to handle and manage money without hiding. Remember that some of the core elements of this industry surround the notion that the opaque nature of traditional finance makes it hard for individuals to partake. Both of these examples can be highly stressful for beginners and those who do not have a ton of cash to spare themselves. So, even if a well-regarded trader is doing this, it might not be smart for a beginner to follow them. Of course, if shorting and dealing with futures is your cup of tea, then, by all means, follow a trader who does this.

• This is actually why some people prefer to copy-trade crypto with people that they know on a personal level.
• This eliminates the guesswork and the lack of experience that’s needed when choosing how to invest your hard-earned money.
• This means that you can leave the difficult work of selecting investments to others.

Investors can rent profitable bots tailored to specific risk tolerances (low, medium, and high) and individual investment goals. A full suite of metrics is available, allowing investors to decide on a bot based on clear, quantifiable data. But there are things that you should bear in mind when considering copy trading and profitability. Just as businesses must know their customers, so too should you do your due diligence when picking a reputable trading platform.

What is Copy Trading in Crypto, and Where to Begin?

It is a huge factor to keep in mind, and having power like that is highly sought after. 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.

• With a brokerage, however, there is no “other person” – you come and exchange your crypto coins or fiat money with the platform in question, without the interference of any third party.
• This website is using a security service to protect itself from online attacks.
• All software, no matter how well they are developed, might go wrong at any time and begin delivering unexpected outcomes.
• If you want to copy the trades of other traders, you can sign up as a copy trader on OKX.

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! This is equal parts exciting and scary, but just remember that even when you copy-trade crypto, you are still the one in charge. If you want to disconnect yourself from somebody else, you can easily do that at any time, and reconnect with them in the future, too. 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. The first step involved in crypto copy trading is arguably the most important.

Best Copy Trading Platforms in 2023

One surprising recent example involves newbies trading investment tips on TikTok. As the phrase suggests, it’s a process in which a crypto investor (or group of crypto investors) copies the trades of an expert trader. Remember what we said about success at the very beginning of this article? Copy or social trading is based on following profitable traders.

• You want to find a platform that offers reliable and secure services, while also meeting your specific needs as an investor.
• Without having someone guide you and give you trading tips, you would have to spend hours analyzing and deciding which stocks you should buy or sell.
• I’ve been using coinmatics copy trading platform for just over 2 months.
• The platform registers over 2 million trades every month and has a monthly trading volume that surpasses $70 billion.

This ensures that your balance remains under your total control. Moreover, our users are able to protect Coinmatics account with two-factor authentication. In 2014, eToro became the first trading platform to support cryptocurrencies when it added bitcoin (BTC) support.

What is the benefit of copy trading?

You can copy trade a forex, CFDs or stock trader, or follow a crypto trader along his journey. EToro social trading is quite popular among beginners who are looking to start with copy trading feature. Pro-traders can share there trades from Binance or other supported exchanges (automatically using API), and investor can automatically copy those trade to make money. First, your success hinges on which investor’s movements you follow.

• In a single click, copy traders can explore new revenue streams, gain exposure, and engage with the larger trading community.
• Unlike many of its competitors, OKX has been dubbed a one-stop shop, due to the variety of services that it offers.
• They are one of only a few top forex brokers to offer fixed spread forex trading.

MetaTrader 5 offers desktop, web, and mobile versions of the platform. This one of the best social trading platforms uses the MQL5 language, the automated trading software that mostly runs on your computer and trades for you. Furthermore, copy trading saves time and effort for busy individuals who may not have the luxury of dedicating hours to market research and managing their own trades. Instead of spending countless hours monitoring charts and analyzing trends, they can entrust their investments to skilled traders through copy trading platforms like eToro. This freedom from constant monitoring allows them to focus on other aspects of their lives while still being actively involved in the cryptocurrency market.

Is Copy Trading Crypto Good for Beginners?

Many people who learn how to copy trade crypto choose to use a service or tool that automatically replicates the trades of more experienced or successful traders. These exchanges allow users to connect their accounts to those of more experienced traders and automatically emulate their trades. 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. New crypto investors can easily follow and copy the trading strategies of successful traders. This copy trading software automates buying and selling of crypto assets by mitigating the original trades of professional traders.

• Essentially, you already need to be a good trader yourself, before you would ever be able to really know which traders are solid, and which ones are not.
• Blindly following the wrong trader can result in significant losses.
• For instance, imagine a novice investor who is interested in investing in Bitcoin but lacks an understanding of technical analysis or market trends.
• As the phrase suggests, it’s a process in which a crypto investor (or group of crypto investors) copies the trades of an expert trader.
• Others don’t like it because it can be viewed as unethical when handling assets from smaller organizations, such as when hedge funders shorted GameStop’s GME shares.
• If you absolve yourself from your own trading, then you can easily sleep-walk into disaster.

If the risks outweigh the potential rewards for your investment goals and risk tolerance, it might be wise to look for other traders who align better with your preferences. Part of learning what is copy trading in crypto is learning that copy traders can essentially – function on any exchange, even ones without a dedicated dashboard or console. This is possible because the vast majority of exchanges, such as Binance, Kraken, and KuCoin, all have APIs that allow you to follow the actions of others through the use of code.

Top Cryptocurrencies

Copy trading is like having your own personal crypto mentor, guiding you through the ups and downs of the market. This website is using a security service to protect itself from online attacks. There are several actions that could trigger this block including submitting a certain word or phrase, a SQL command or malformed data.

• They can help you trade automatically and make the most of market movements.
• Many people who learn how to copy trade crypto choose to use a service or tool that automatically replicates the trades of more experienced or successful traders.
• If you’re new to crypto copy trading, you need a platform that has a simple and attractive interface.
• One can examine the track record of various lead traders on the dashboard and select the one that fits in with the parameters of their choice.

So far, our discussion on what is copy trading in crypto has touched on the act of automating your copy trading habits, but let’s delve further into it now. As mentioned before, places like eToro have a dedicated platform for copy trading, which is simple and effective to do. But you can copy trade on other exchanges as well, even if they do not have a console created specifically for it. It is worth keeping this in mind when you start copy trading yourself, as even the most well-versed crypto trader will still have knowledge gaps. This is unavoidable as those gaps are caused by a lack of historical data. However, it is not necessarily a bad thing, as sometimes, too much data can cloud judgment and lead to a false sense of security.

Set up the software

You can choose who to copy from a list of lead traders who have different performance indicators. You can also adjust your copy settings like maximum amount, take profit, stop-loss, and the number of positions. You can use Coinmatics with different exchanges, like Binance, BitMEX, Bitfine, – and Bybit. You can also trade with different coins, like Bitcoin, Ethereum, Litecoin, Ripple, Cardano, Polkadot and more. And you can choose different types of trading, like spot, futures, and perpetual. It will copy the trader’s orders on your account as soon as they happen.

What should you know if you are planning to broadcast your own trades for others to copy? For starters, bear in mind that by opening yourself up to copy traders, you may feel a new level of responsibility for those following you. This can sometimes work, but remember that we are all fallible, and even the best traders can do a poor job of reading the room. This is why it is important to understand the fundamentals of what is copy trading in crypto as well as understand the conceptual elements.

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Temporary losses can and will happen, but you shouldn’t decide to unfollow a trader prematurely because of fear, doubt, or uncertainty. Similarly, when best crypto exchanges for day trading, take advantage of the power, consistency, and reliability of crypto trading bots. While you stand to profit by copying the trades of a successful trader, you’ll also sustain losses when the trader’s bot encounters a losing streak.

• The copy trading feature means that all trades opened and closed by the trader are replicated in the follower’s account.
• Just as businesses must know their customers, so too should you do your due diligence when picking a reputable trading platform.
• For instance, simply buying $100 worth of Bitcoin at market rate.
• That’s why you need a dependable and user-friendly copy trading platform that gives you a wide range of traders, instruments, and tools to help you succeed in your copy trading journey.
• By understanding the risks and taking necessary precautions, investors can use copy trading as a valuable tool to enhance their trading performance.

However, modern providers of copy trading services enable the process to be completely automated. In this case, all you have to do is decide which trader (or traders) to follow and how much of your account capital to allocate to that trader. While copy trading allows a trader to view the actions of lead traders, they don’t get to see the work behind the scenes that led them to make those moves.

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