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Crypto bots and crypto automation by Thriven
The crypto market has seen enormous increases in price and the number of investors in recent years. Unfortunately, there are also plenty of investors who have realized losses because prices regularly fall sharply. It is very difficult to time when the right time is to buy or sell crypto. Many have therefore opted for crypto automation to leave the correct timing to smart systems. A selection of these systems is a crypto bot for automatic trading, or a Dollar-Cost-Averaging (DCA) tool to automatically invest in Bitcoin or altcoins.
Index
Why should you invest in crypto
Bitcoin has risen more than 100% per year on average. There are few investments that have yielded such a return over a longer period of time. However, many believe that crypto poses too much risk, because the history of crypto has many declines. A small group of investors are trying to take advantage of the volatile nature of crypto by taking advantage of both rises and falls. They see moments of crypto price increases to realize profits in Euros. On the other hand, they view periods of crypto price declines as opportunities to accumulate more crypto, and thus achieve additional returns with subsequent price increases.
Why should you automate crypto investments and trades
There are traders and investors who have made crypto trading their job. They watch price movements all day long and try to predict the market using strategies. However, it is only a very small percentage that will trade profitably. A study even showed that 97% of day traders lose money.
Because profitable trading is so complex, the crypto market is open 24/7 and most people do not have time to be intensively involved in the market, many use some form of automation. A number of reasons why people choose automations in crypto, including a crypto bot, are:
- Time savings: Traders and investors will save a lot of time because they can use automation to use rules and systems that execute their strategy. No constant monitoring is required by the person using the automation. This allows the investment or trading strategy to be executed 24/7.
- Consistency: By using a crypto bot or automatic investment system, a strategy is executed consistently. A crypto market can be very volatile, making it difficult for manual traders to continue executing a strategy or plan. Long-term success is closely linked to consistency in the crypto market.
- Speed: Manual traders usually cannot keep up with the speed of a system such as a crypto bot. An action can be carried out within nanoseconds, while the markets are constantly monitored.
- Emotions: Positive results can be seriously undermined by human emotions. In a volatile market, impulsive decisions are likely to occur. Automating actions removes the emotional aspects. Crypto trading bots and algorithms execute transactions according to defined rules.
Ways of automation at Thriven
To enjoy the benefits of automations in crypto, Thriven has designed several systems. These are explained in detail below. Are you curious about Thriven’s systems in relation to other parties? Check out our article to determine the best crypto trading bot for you.
1. Smart Dollar Cost Averaging (Smart DCA)
The first system is Smart Dollar Cost Averaging (Smart DCA), which automates crypto investments and optimizes buying and selling moments. Before we explain Smart DCA, we start with Dollar Cost Averaging (DCA) in crypto.
DCA: How it works
With Dollar-Cost-Averaging (DCA), an investor regularly invests a fixed amount, regardless of the price. Over time, an investor will pay an average price per share, which is often lower than if an investor had invested all his capital at once at a certain point in time. The big advantage is that the risk of one-off investment is eliminated by DCA.
Benefits of DCA
- A potentially lower average cost per asset you invest in;
- Preventing emotional factors in investments by ignoring short-term price fluctuations;
- Achieving long-term investment goals through simplicity and periodic nature
Risks DCA
- DCA is less effective in a constantly rising market. An investor would have been better off making a one-off purchase at the beginning of the investment period;
- DCA does not work in a declining market, because the average cost per asset will actually be higher than if all the money were invested at a later date;
Tackling the risks of DCA
Because we at Thriven have experienced the risks of DCA ourselves, we wanted to try to solve them through automation. For this, we added the missing aspects of DCA to develop a smart DCA strategy called Smart DCA. The issues were addressed by Thriven’s system in the following ways:
- Optimize purchasing moments: The DCA strategy uses the periodically deposited funds directly to purchase crypto assets. Thriven’s Smart DCA strategy takes the current market trend into account to determine whether it is a good time to buy crypto assets. As a result, the funds may not be used directly to purchase the crypto assets. This is especially advantageous in a declining market.
- Taking advantage of falling markets: In addition to better timing of buying moments through our strategy, we use the current market trend to determine suitable sales moments. Thriven’s automated process at these times sells all crypto assets for a stablecoin equal to the dollar. Selling crypto assets, such as Bitcoin, mainly makes sense when the trend changes from rising to falling. The released funds that are now in the stablecoin can be used again at a later time to buy back the crypto assets. As a result, a user ends up with more crypto coins and benefits from this in a rising trend.
Smart DCA via Thriven
Smart Dollar Cost Averaging (Smart DCA) is an automatic trading strategy from Thriven that, as explained above, attempts to tackle the risks of DCA. In addition, Thriven makes it possible to automatically invest periodically in Bitcoin via automatic bank statements. This allows you, for example, to invest in crypto after your salary, without carrying out any actions yourself.
The goal of Smart DCA is to improve DCA (periodic investing) in both a rising and falling market. The biggest difference between DCA and Smart DCA is that Smart DCA both buys and sells, in an automated way. Because Smart DCA is a trading strategy, it is not strictly necessary to invest periodically. The strategy with an initial deposit can also be used. However, the benefits of DCA disappear without periodic contributions, which increases the risk of fluctuations in returns achieved in the long term.
Smart DCA is summarized below:
- With Smart DCA from Thriven you automatically periodically invest from your bank account in crypto. You can set how much and how regularly you invest;
- Thriven’s system will ensure that your moment to buy crypto is optimized based on the (rising) market trend;
- Finally, Thriven’s strategy will ensure that your crypto is automatically sold for Stablecoin (Euros) based on the (falling) market trend.
Auto Investing in crypto?
Read about smart investing via smart DCA; a strategy that tries to improve DCA (periodic investing).
Auto Investing in crypto?
Read about smart investing via smart DCA; a strategy that tries to improve DCA (periodic investing).
2. Automated trading (Auto Trading)
The second system is automated trading (Auto Trading), which automates actions in crypto trading. Before we explain Auto Trading, we start with storing crypto in a wallet (HODL).
HODL: How it works
HODL, which stands for Hold On for Dear Life, is a strategy that means an investor buys crypto and no longer sells it. This also applies if the volatile cryptocurrency experiences large increases or decreases. HODL is therefore about an investor holding on to his investment for a long time and not trying to outperform the market by trading or selling at higher prices.
Advantages of HODL
- Supporters of this strategy believe in the long-term rise of the underlying crypto assets. You don’t have to sell for this;
- The HODL strategy prevents emotional behavior when price increases or decreases. This can prevent losses;
- No experience and knowledge of crypto trading is required, which can cause losses for many.
Disadvantages HODL
- The volatile nature of the crypto market provides many buying and selling opportunities for crypto assets. This is never taken advantage of with the HODL strategy. The crypto market experiences long declines, called bear markets. This can lead to long-term losses;
- Some crypto assets will never rise, creating a major risk for followers of the HODL strategy.
Tackling the disadvantages of HODL
After experiencing a number of long bull and bear markets, in which crypto rises or falls, we have experienced the risks of HODL firsthand. There are many moments where we believe it is better to act than to do nothing. In addition, we at Thriven believe in the survival of a number of crypto assets, but not all Altcoins. The problems of the HODL strategy are addressed by Thriven’s Auto Trading system in the following ways:
- Take advantage of buying and selling moments: Thriven’s Auto Trading ensures that buying and selling moments for your crypto are automatically determined and executed. This is done via Thriven’s algorithms, which have been developed by various experts with more than 20 years of experience. With these systems, the crypto assets on your wallet are traded at certain times, in order to benefit from both rising and falling markets. The goal is to obtain more crypto assets for users. We believe that people will benefit from more crypto assets if the market rises.
- Supporting ‘proven’ crypto assets: At Thriven we do not believe in all alternative cryptocurrency, called Altcoin. Of course, a lot of returns can be achieved with these small coins, but there have also been plenty of cases where they have never increased in price. For this reason, we only support Bitcoin and Ethereum with Thriven’s Auto Trading systems.
Automated trading (Auto Trading) via Thriven
Auto Trading, or automated trading, is an automated system from Thriven that makes it possible to trade the crypto on your wallet via our algorithms. With this, the specific crypto bot tries to profit from both price increases and price decreases of the underlying crypto asset. A user deposits crypto into his or her wallet via the extensive onboarding and joins the Thriven system. All actions are then automated.
The goal of Auto Trading is to accumulate more cryptocurrency and maximize Euro value. The underlying idea is that the price of crypto assets increases in the long term and with it the Euro value. The crypto assets that Thriven’s Auto Trading supports are Bitcoin and Ethereum.
Auto Trading is summarized below:
- With Auto Trading from Thriven you automatically trade in Bitcoin or Ethereum from your own crypto wallet. The goal is to accumulate more cryptocurrency to maximize Euro value;
- Thriven’s system ensures that declines are automatically responded to in the event of an expected fall in the price of Bitcoin or Ethereum;
- Finally, Thriven’s strategy will ensure that increases are automatically responded to when the price of Bitcoin or Ethereum is expected to rise.
Auto Trading in crypto?
Read about Auto Trading; the strategies for BTC and ETH that HODL (do not sell) is trying to improve.
Auto Trading in crypto?
Read about Auto Trading; the strategies for BTC and ETH that HODL (do not sell) is trying to improve.
Complete automation in crypto: The big picture
With Smart DCA and Auto Trading, most transactions within the crypto market are automated. With Smart DCA you can invest smartly from your bank account in crypto assets. In addition, with Auto Trading you can automatically trade with your crypto in an automated way.
These two products can be used together to make optimal use of automated investing and automatic trading via a crypto bot. Both products are available from the Plus subscription. Would you rather build your crypto portfolio first via Smart DCA? Then you can start with the Starter package from an invested capital of €0.
How to start from €0
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