You can do it smartly with many working concepts devised by people using algorithmic trading systems powered by sophisticated technical analysis strategies. However, it takes time and effort to master several important analytical approaches and create an automated trading system that works well with target digital assets.
The biggest question is how to choose the best scalping bot for 2025 to not lag behind the rest of the market and achieve the necessary level of consistency without hurting your bottom line. It can be quite hard to identify the right automation provider, select a good strategy, and find the best way to mitigate risks, but it can be done if you are willing to learn and spend significant time on testing.
Is scalping profitable in 2025?
The market for Bitcoin, Ethereum, and viable altcoins is huge. It is expected to grow steadily and without much turbulence throughout the year and beyond. Many experts base their optimistic predictions for the crypto market on the recent approval of Bitcoin ETFs and the increase in governmental regulation of the industry. The addition of other financial instruments derived from ETH, XRP, and other tokens can become a strong push that the market needs to skyrocket to a new ATH.
As market stabilizes and creates strong long-term trends, we can expect a moderate level of volatility on shorter time frames and many opportunities for people to make money speculating on the prices. Finely tuned crypto scalping bots can take advantage of short-term price movements and deliver profits quite consistently.
One must remember that even the best profitable scalping bots will deliver terrible results if you do not have a good source of trading signals.
There are three types of signals that are commonly used by contemporary retail traders:
- Manual triggers. You may receive a good tip from your friend or a social media influencer. These signals do not require instant reaction and often work over longer periods of time. If you think that you received a viable suggestion, you can manually create a trigger for bots to start trading according to their algorithm when something happens in the market.
- Trading signal sellers. Some analytical companies offer their services and sell advice on social media, in Telegram channels, or send them as direct signals that can be interpreted by automation platforms as triggers. Finding a good provider of signals can be very challenging since it takes a lot of time to sort out legitimate analysts from bad actors trying to make a quick buck.
- Technical analysis strategies. Many terminals like TradingView allow users to deploy multidimensional technical analysis systems employing multiple trading indicators to produce trading signals. You need to know how to use these tools and build strategies that can reliable give you true positives. It takes quite a long time to learn the necessary skills and thoroughly test everything.
If you have a good source of trading signals for your crypto bots and do not need to guess when to activate them, a scalping strategy can be profitable. However, you still need to figure out which algorithm to use. In essence, any algorithmic trading system can be used for scalping. Grid bots with shorter periods between placed orders and finely tuned price ranges can work just as well as any other approach to high-frequency intraday trading.
How to backtest a scalping robot
Regardless of which scalping strategy you decide to employ, it is important to vigorously test it. There are two levels of testing both of which should be employed to find a combination of various parameters that work well and deliver profits consistently under certain market conditions.
1. Testing your trading signals. Depending on which source you use, the testing process will be different. For example, you may need to test purchased signals using demo accounts at CEX platforms. If you run technical analysis strategy on TradingView, use “strategy tester” and check how your setup fares against the market history.
2. Testing the automated trading system. If you have a source of reliable trading signals, it is time to test your bots with different settings. The WunderTrading platform has the backtesting feature that allows you to use your trading signals and adjust bot settings to identify combinations that work well. An appropriate set of historical data should be used in both cases of testing.
You should never use your actual trading accounts for experimentation. Instead, try using the paper trading feature offered by WunderTrading or other automation vendors that have deep enough product lineups. It is hugely important to use virtual money and test how your systems work under real market conditions.
The testing phase should be long enough to identify critical errors and avoid unnecessary losses. Do not forget to adjust the parameters of delayed orders (stop loss and take profit) and tinker with position sizes to estimate optimal profitability goals and risk management guidelines.
Paper trading scalping strategies
Many retail traders do not understand why they should use paper trading accounts to test ideas that do not carry a high risk. For example, they believe that if you only lose just 1% of your portfolio with a single trade, you can just run it for a couple of days to see what happens and make adjustments in real time.
The issue here is that scalpers tend to open dozens of market positions every day. It means that they can lose significant portions of their portfolios if they allow any system run rampant even with the lowest single-trade loss rate. 10 losing trades in a row with each losing just 0.5% of your assets will translate to 5.6% loss (compounded). Imagine if you engage in leverage trading and use borrowed funds!
To avoid such tragic outcomes, it is hugely important to focus on stress-testing all your investment ideas safely. The best way to do it is to use paper trading!
Risks of using scalping bots
It is strongly recommended to never use scalping for margin trading. A single mistake can cost you a fortune. With dozens operations conducted daily, it is possible to drive a portfolio into the ground in just a couple of trading sessions. Remember that bots work around the clock and may catch a losing streak when you cannot stop it.
While scalping can be profitable for some investors, we believe that alternative ways of participation in the market are more viable in the long run. Many experts recommend using standard grid and DCA bots or engage in arbitrage to reduce risks and leverage the power of automation to its fullest extent. Less aggressive day trading technique can be also relatively safe and profitable.
If you believe that scalping is the right approach for you, we want to give you a warning and list some risks strongly associated with even the best automated scalping strategies:
- Unexpected market volatility. It is hard to predict when the market enters a phase of chaotic price movement. It can happen quickly following breaking scandalous news stories or put into motion by a frivolous “X” by some billionaire. Many automated trading systems fail during periods of volatility. It is often recommended to completely abstain from trading during such dangerous times. However, you may not stop your bots in time. Scalping systems can quickly lose significant amounts of money when the market is in chaos.
- Higher trading costs. Commissions paid to centralized exchanges or gas fees may seem insignificant when you make one or two transactions per week, but when you make dozens of them daily, they pile up rapidly. It is easy to lose control over expenses related to covering necessary commissions and fees as many retail traders tend to not count them as losses. However, your bottom line will feel ramping up commissions and high costs of high-frequency trading.
- Rapid price changes. When you have short-term market positions, they are vulnerable to slippages that may occur when news stories roll out and cause high volatility. Any disruption in the flow of market data can be devastating for a scalper. Any unforeseen change in the market will affect your market positions. If you have a bot that liquidates them after a set period, you risk losing too much due to not waiting for the following retracement.
- Scammers and fake advertisement. The oversaturation of the trading automation market and the prevalence of undereducated investors in the crypto ecosystem allow bad actors to conduct their operations at scale and scam people out of their life savings. You must be aware of potential frauds in the industry and keep your eyes open for fake ads promising you guaranteed returns on investments.
Scalping is an approach that has a high-risk profile. Many experts believe that one should never engage in it or do it only if they have other investments spread across safer asset classes. If you are all-in on crypto, having some coins staked and some money invested in tokens that look safe is essential before engaging in riskier approaches like scalping or HFT day trading.
Scalping robot tips for success
It is possible to avoid many risks by working with a reliable trading platform and focusing on risk management. Here are some good tricks to use if you want to cut potential losses and optimize profitability:
- Use delayed orders strategically. Stop loss and take profit orders should be employed to avoid undesired losses and secure profits. When it comes to scalping, it is important to take commissions into consideration and estimate profitability goals based on the spread between gains and commissions.
- Do not use a large portion of your portfolio on automated scalping. Remember that even the best crypto scalping strategy can fail due to unexpected market conditions or other factors. Do not put too much faith into a single investment approach and have other investments that can offset potential losses from high-frequency trading.
- Work only with reliable automation vendors. Choose your bot service provider wisely and try to not work with companies that have poor technological infrastructure, bad UX design, and underdeveloped products. Pick partners that allow you to quickly learn the platform while providing a rich selection of trading instruments like social trading, preset bots, and AI-powered systems.
Alternatives to scalping in 2025
It is easy to learn how to make a scalping bot if you are using a good automation vendor. You will have no shortage of detailed educational videos and guides to quickly get up to speed with the products available in their catalogs. However, the convenience of a product does not mean that you should use it without any additional considerations.
The trading automation industry offers a wide range of alternatives that can be just as profitable as the best scalping systems you can come up with:
- AI-assisted statistical arbitrage. It is a novel product that implements machine learning trading and allows retail traders to work with hundreds of assets. An expert artificial intelligence system will create a portfolio and make adjustments to its composition as required.
- Aggressive grid trading. It is possible to use settings for your grid bots that will make them quite aggressive while avoiding huge losses. With an increase of target profitability risk profile of your market positions will also change, but it is somewhat easier to manage and quickly adjust when needed.
- Social trading. If you lack the experience with the market or want to simplify the investment game, you can simply copy actions of investors who show high profitability numbers. Copy trading is a great tool for newcomers!
Remember that a scalping bot is just a tool and will perform according to expectations only if you have a good technical analysis strategy to produce high-quality trading signals and use good risk management techniques to avoid the dangers of the crypto market.