Is Trading Bot Legal?
One of the main attractions of cryptocurrency trading is the dynamism and mobility of the market because, unlike other financial markets, this market is open 24 hours a day. Users can only connect to the internet, register in a trading exchange with a few simple clicks, and trade cryptocurrencies with users from other parts of the world at any time and place.
On the other hand, the high popularity of cryptocurrencies, innovations in how to trade, and an increase in the volume of market transactions, have caused modern knowledge and new technologies to help people and witness the design and presentation of new tools and products such as trading bots, wallets, mobile applications, exchanges, etc. But the question is, is using these tools like a trading bot legal?
What is a trading robot?
Before answering this question, defining the trading bot tool is the key. A trading bot is programmed computer software that, like a smart assistant, helps the trader make timely and profitable trades. Programmers program trading bots using special algorithms and are ready to analyze the market and make trades. Trading bot efficiency depends on developers' skills, expertise, and awareness of the cryptocurrency financial market. However, in most ways, it works better than humans.
Unlike other financial markets, cryptocurrency is active around the clock. People must always be present to manage assets, make timely transactions in the market, and buy and sell. Since this is practically impossible for humans, most traders use a trading bot daily. According to their investment strategy and goals, these people adjust the trading bot and, without spending a lot of time and eliminating the impact of human emotions and feelings, entrust the purchase and sale of cryptocurrencies to special bots.
Advantages of using a suitable trading bot
• Very high speed of operation: according to the user's settings, the trading bot buys and sells cryptocurrencies at a very high speed at the right time.
High processing capacity: Unlike the human brain, a trading bot can process all information quickly and take action based on available data.
• Non-interference of personal feelings and opinions: Programmed software only buys and sells based on user preferences and predetermined schedules. As a result, trading is based solely on market data and technical analysis, and no human emotion is involved in the robots' activities.
Continuous and non-stop activity: the trading bot can trade 24 hours a day, seven days a week, without stopping or losing opportunities.
• Use of trading algorithms: Operating in financial markets such as cryptocurrencies requires continuous study, learning, and familiarity with analytical tools. Trading bots analyze the market with careful planning instead of humans and automatically use analytical tools. The user's trading bot strategy is buying and selling.
Is cryptocurrency trading legal?
Since its inception, the cryptocurrency market has operated independently and decentralized and is not controlled by any of the world's governments. As the market expands, it has created new challenges for market regulators and financial regulators.
But what is clear is that cryptocurrencies are very popular worldwide and rapidly advancing in their path. Instead of criminalizing and banning the sale and purchase of cryptocurrencies, big governments seem to be considering regulating this market. In general, cryptocurrency trading is not currently prohibited in any country. Meanwhile, in some countries, we see restrictions on mining and using cryptocurrency as a currency for buying and selling goods.
Is trading bot legal?
A trading bot's performance is no different from that of humans. A trading bot is software that connects to an exchange and sends human commands to the exchange server. This software does not commit any illegal or fraudulent acts. A trading bot does not even have access to your money in practice and works exactly according to human command to transfer & buy and sell cryptocurrencies. Apart from this, you can turn off this bot at any time.
The usage of trading bot may be restricted in some countries of the world according to governments, but the reason for this is the hostility of governments to cryptocurrencies, and a trading bot is only a tool in this market. However, governments are not completely opposed to the use of cryptocurrency and only seek to legislate and tax it. However, a trading bot can always be a safe tool to help you wherever the use of cryptocurrency is free.
The busy and fast lifestyle of human beings and the power of sciences such as artificial intelligence that came with the help of trading bots has caused a lot of attention to this attractive trading tool. Even large centralized exchanges operating under the auspices of legal entities encourage users to use trading bots. Among these, we can mention the reputable Binance and BitMEX exchanges. On these platforms, users can access the dedicated trading boy of the exchange and use its facilities.