Is AI Trading Bot Safe?
If you are interested in cryptocurrencies or have invested in the cryptocurrency market, you must have heard of bot trading. A trading bot is software that allows you to trade entirely automatically. For example, you turn on this bot in exchanges such as BitMEX or Binance, and it automatically opens or closes positions for you. Of course, this is not the only task of the trading bot. The bot analyzes the market and then makes a decision. However, the common feature of all trading bots is that they operate automatically.
Using bot trading is not a new concept, and usages of these bots are increasing day by day. However, with the combination of new sciences such as artificial intelligence, their accuracy has improved. According to the information entered by those who configure them, AI trading bots work following pre-established commands.
This way, they can identify volumes, prices, and other variables. Today, many exchanges allow their users to trade by AI trading bots. The significant exchanges are more eager to invite users to use these bots.
There has been a lot of talk about using these bots, but there is a bigger question that many crypto fans are looking for: the security of AI trading bots. This article will review the safety of AI trading bots like BitMEX AI trading bots.
Are AI Trading Bots Safe?
To answer this question, we must first have a clear understanding of artificial intelligence bot trading performance. Does security mean that we will have control over the property after using the trade or not? In other words, can an AI trading bot transfer or destroy all of a person's capital? Security is divided into two parts, which we will talk.
Bugs and Failures in AI Trading Bot Operation are not Common.
It is technically possible for bot trading to destroy people's capital, but no programmer does it intentionally! Bot codes are usually tested several times before they are being sold. If you have chosen the right bot, there will be no unintentional error and harm.
Bot trading may not be profitable for you at certain times when market conditions are unfavorable, but it will be beneficial for long periods. The performance of AI trading bots also improves over time. It is due to a feature in the AI algorithm in which the error rate decreases with each trade repetition. It is called training.
Another point is that every trade is made with a bot with a stop-loss. Stop Loss is the loss limit that causes the bot to close the order when it reaches a specific price. The loss limit in some bots is selected manually, but advanced bots such as artificial intelligence trading bots can choose stop-loss, and your money is safe totally. Trading this way is similar between bot and human.
What is Binance FUTURES trading bot?
Can AI trading bot steal money?
Another concern of crypto fans is whether bots can transfer people's crypto to an unknown destination. To answer this question, you should find out the relation between the bot and the exchange. An artificial intelligence bot is a tool that does not work independently. In other words, this bot does not attach directly to your wallet and does not have access to financial information.
AI trading bots are tools attached to a specific part of the exchange to buy and sell. In fact, exchanges provide limited access to external sources to set buying and selling orders, called API. The exchange does not provide your private key to the bot in any way. Technically, the bot can not transfer your assets elsewhere because its codes are written to connect to exchange.
Another point is that secure exchanges ask you for permission to withdraw crypto from the exchange. This permission usually confirms the code sent to the email or entering the password. If you have activated 2FA at your exchange, your security is relatively high, and there is no need to worry. So any agent who wants to take your money out of the exchange must first get your permission. It guarantees the security of AI trading bots and indicates that the tool is secure. In other words, the exchange still ensures safety. Then you should be even more careful about choosing exchange than choosing an AI trading bot!
Things to keep in mind
Cryptocurrency is a mysterious market, and scammers are everywhere. However, you can do a few things to choose a safe AI trading bot and make a profit. The first point is to ensure that the source you are buying an AI trading bot is trustworthy. Trustability comes from communities and data in the crypto world: the more trustable data you find, the more trustable bot.
If you want to be fully aware of the security of a bot trade, this is the best way to test it! Nobody can change AI trading bot codes because the exchange does not allow it. If you bought an AI trading bot and wanted to be aware of its security, deposit very little money in your exchange and test the bot. If the bot does not harm your capital, you can increase your capital and earn money by the tool.
Conclusion
Using trading bots like BitMEX AI trading bot is the best way to automate trading. By choosing suitable bot trading and running security procedures, you can increase your profits easily and quickly.