Among other centralized exchanges, this one has the strongest focus on providing the necessary tools to make cryptocurrencies usable in the real world. The technological aspect of the platform is nicely developed. Whether you want to focus on advanced tools like an AI trading bot or focus on copying others, you will find everything you need to set up an automated system.
You can create a Bithumb trading bot using different options. For instance, the platform has native automation tools that can be used by all retail traders. The OpenAPI is also available to more advanced investors who want to use local software or connect a third-party vendor to operate robots from a familiar platform.
Why should you use Bithumb?
This centralized exchange is an excellent choice for those who want to trade digital assets while having direct access to funds in the wallet via QR-code and barcode payment systems. Investors from the US will be happy to learn that the platform is planning to expand to the US market and become a verified provider of services that comply with national US regulations, KYC, and AML guidelines.
Here are interesting features of the platform that make it an excellent destination for capital allocation:
- The spot market is the flagship product with a strong focus on local crypto tokens released by Korean developers. You can trade Bitcoin, Ethereum, Solana, and many other mainstream coins alongside memecoins, governance tokens, and more.
- Financial services offered to all clients are quite diverse allowing users to lend, borrow, stake, and otherwise utilize their digital currencies. Users can stake ATOM, MATIC, ETH, and other tokens. You can get started with delegated ETH staking with just 0.01 ETH and receive up to 0.79 APY on your investments.
- Payment systems that can be used to pay for all sorts of services in Korea. You can use all standard methods like barcode and QR-code payments using funds directly from your account. It is a useful proposition for those who simply want to adopt crypto for day-to-day activities.
- An advanced automation module allowing users to quickly set up simple scheduled trades protected by delayed orders like stop loss and take profit. You can also run a full-featured robot using the native capabilities of the platform.
A native crypto trading bot for Bithumb may be limited in terms of functionality compared to the offerings from specialized providers like WunderTrading. However, many retail traders will find them sufficient if they don’t plan to run complex autonomous setups. If you are interested in DCA crypto buying to acquire assets for long-term holding or plan to use a simple swing strategy, you likely won’t need additional tools from advanced automation vendors.
However, sophisticated technical analysis strategies and approaches like statistical arbitrage may require more than what is offered by this centralized exchange. We strongly believe that it is necessary to use highly specialized platforms if you plan to achieve consistency and optimize profitability.
Why should you automate trading on Bithumb?
CEXes are designed to facilitate quick swaps and exchange of digital assets. You can work with hundreds of various digital assets simultaneously even if you have a relatively small capital. Limiting your options to just mainstream coins is a suboptimal approach to building an effective strategy. Robots offer some notable advantages to contemporary retail traders:
- Bots do not need to rest. The crypto market operates around the clock with any timeouts. A human trader has to take breaks to eat, sleep, and rest. These gaps in market activity can significantly reduce the efficiency of your strategy because you may miss out on valuable opportunities. Since many operations on this exchange happen when many traders in the US are sleeping, using an autonomous system on this CEX is a good idea.
- Emotionless investing. Many retail traders have to overcome psychological issues to become effective in the market. However, even the best of them still succumb to emotions like greed and fear occasionally and make suboptimal decisions. Robots simply follow a predefined set of instructions based on a technical analysis strategy.
- Affordability. Contemporary retail traders can use advanced ATS setups that cost way less than huge financial institutions had to pay three decades ago. Robots are now widely accessible and affordable. In fact, over 65% of all individuals and up to 99.9% of institutional investors use various forms of automation to at least some degree.
Bithumb automated trading strategies can be created with external connections to its digital infrastructure through its OpenAPI. The documentation can be hard to read since it is available only in Korean. Thankfully, illustrative examples help anyone quickly get a grasp of key features. Nevertheless, it can be challenging for newcomers to set up an API connection using local software.
Which Bithumb trading automation systems to use?
This CEX has a massive catalog of available financial instruments. It means that investors should take advantage of relatively low fees and the abundance of currency pairs to set up sophisticated automated systems. We suggest testing several strategies:
- Statistical arbitrage. Correlated pairs of assets can be included in a balanced portfolio that achieves consistent returns through regular adjustments. These setups previously required an army of retail traders to analyze the performances of various financial instruments all the time. Today, you can run an AI-assisted robot on the WunderTrading platform to get similar results.
- GRID bots. Distributed Cost Average is a good approach to growing a portfolio by reducing the average acquisition price. Many automation platforms offer grid trading robots. You can find them on CryptoHopper, 3Commas, and WunderTrading among many others. GRID systems have proven to be effective at generating passive income for investors who know how to set them up correctly.
- Triangular arbitrage is one of the safest methods of engaging with the market but they require an army of dormant bots waiting for their moment. When prices of three pairs sharing two digital assets reach a price disparity allowing to make a profit, several bots can act immediately to conduct a trade with a guaranteed gain. However, you need multiple robots to be ready for action at all times.
These strategies can be viable on this exchange, in particular, thanks to its liquidity depth, a large catalog of financial instruments, and advanced technology.
Finding the best bot for Bithumb in 2024
Several highly specialized platforms offer their products to investors interested in contemporary robots. The industry seems to be oversaturated with options but only a handful of companies have the necessary experience and track records to be considered by serious crypto enthusiasts. To build a portfolio with multiple automated systems, consider platforms from the list below.
- CryptoHopper is a well-known platform that offers a wide range of automation solutions including ready-made robots like DCA and GRID bots. These can be deployed immediately after you create an account and connect an exchange account. CryptoHopper is strongly focused on preset bot configurations and implementing innovative technologies like artificial intelligence to make its products stand out. However, investors interested in social elements will find the company catalog lacking.
- 3Commas is a good choice for retail investors who do not have much experience in the world of crypto and would like to use advanced copy features. It is the main focus of this platform with a strong community formed around the marketplace for managers offering their services to the clients of the platform. 3Commas has a variety of other interesting offerings including standard preset bots, custom scripts, and more.
- Gunbot is a relatively new product that many investors may have not heard of. It is designed to work with all sorts of platforms including DEXes, brokers, and CEXes. The AI component is capable of writing new strategies for users based on their descriptions of what they want to achieve with their investments. Gunbot is a good choice for people who have some technical know-how and do not mind tinkering with settings for a long time.
- WunderTrading has been around for over a decade. It offers excellent service and a good user experience thanks to its clean dashboard. Clients can use many features for free. WunderTrading’s catalog contains preset solutions, custom signal bots, a massive social hub and marketplace, arbitrage robots, and even AI-assisted systems.
Note that none of the high-profile automation vendors support Bithumb crypto trading bots out of the box and you may need to tinker with account settings to establish an API connection. Thankfully, all four of the companies mentioned above provide an excellent level of customer service.
The main takeaway
This crypto exchange from Korea is quickly gaining ground in the international market and plans to expand to the US, EU, and Africa in the near future. We strongly believe that you should practice setting up a trading bot on this CEX to prepare for its eventual expansion and be ready to trade with an increased level of efficiency when it is available in your region.