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What is Algo trading in Cryptocurrency? Explained

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Algorithm trading has been in stock markets for many years. In simple terms, algorithm trading refers to using a computer program or system to trade on the market according to a specific set of rules. The system makes use of mathematical models and statistics to decide when to trade assets on an exchange

What is algorithmic trading in the crypto market?

Algorithmic trading in the cryptocurrency market is similar to algo trading in traditional markets, but crypto markets have much higher volatility than conventional markets. Higher volatility creates bigger swings in prices and opportunities for traders. Unlike traditional markets, crypto markets never close. Algorithmic trading in the crypto market is helpful for several other reasons too. Ago trading in traditional markets is dominated by proprietory strategies run by multimillion-dollar quant funds. 

Note: Algorithm trading does not guarantee profits, but it can be used to manage volatility. You should regularly read crypto news or subscribe to platforms like cryptopanic or cryptoviral.

Two aspects to which algorithm trading is applied:

1. When to trade: Algorithm systems execute trades according to the technical indicators, momentum, and fundamentals of the crypto market. Algorithm trading contains an extensive range of strategies for when to trade.

2. How to trade:  Algorithm trading, if compared to manual trading, can execute orders more efficiently. It can help crypto traders to execute orders at the best price available according to the size of their trade, market conditions, and the time of the trade. 

How algorithm trading is used to decide when to trade

Algorithm trading can help traders determine when to trade by looking at different aspects, including price, momentum, volume, and other things. The advantage of algo trading is that they can execute trades and act on these signals much faster than humans. However, algorithms can’t generate profits all the time as it is impossible to get it right all the time. 

Arbitrage opportunities

Arbitrage opportunities occur where the price of an asset on one exchange is different from the price of the same asset on another exchange. Traders can usually make profits by buying the asset on an exchange where the price is low and then sell it on another at a higher price. Algorithmic platforms like Algolead.com can easily sniff out these inefficiencies in the market and profit off of them much effectively than humans. However, time delays in execution, liquidity across exchanges, and fees charged to transfer funds can minimize the profits.

Algorithms are applied to many aspects of trading.

As the crypto industry matures gradually, traders are adopting more efficient ways to trade cryptocurrencies. Algorithms are widely used by crypto traders to get an edge and make higher profits. Algorithms can be applied to almost all aspects of the crypto trading, including where to place trades for market-making and arbitrage algorithms to achieve better pricing and execution on trades. 

Note: Market maker is a firm that offers liquidity by offering simultaneous buy and sell orders on an exchange or OTC.

Conclusion

Algorithm trading is an efficient way to execute trades in the crypto market, and it acts as a wall for traders to protect them from the highly volatile market. However, it is important to keep in mind that algorithms are not guaranteed to make you profits all the time as they only work according to mathematic formulas and history of the market. Using algorithm trading can undoubtedly help reduce risk and manage volatility. 

Source: https://chaintimes.com/what-is-algo-trading-in-cryptocurrency-explained/

Blockchain

LINK Marines Lock and Load as Price Falls to Six Week Low

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Chainlink’s native token LINK has been one of the hottest crypto assets this year but that has not helped it escape this week’s big selloff.

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Crypto asset markets have dumped $35 billion in terms of total capitalization since the weekend and the sell-off looks set to continue as Bitcoin and its brethren weaken.

A number of crypto assets are retreating from their all-time highs this year and investors are looking for entry points. Chainlink is among them as one of the year’s best performing crypto assets cools off quicker than some of its competitors.

LINK Marines Loading Up

LINK prices have collapsed to their lowest levels for almost two months in a fall back to $7.30 according to Tradingview.com.

LINK price
LINK price – tradingview.com

There has been a minor recovery today as the token topped $8 again, but it is still massively down from its all-time high in mid-August. Back then the Chainlink token briefly touched $20 but it has been a downward slide ever since resulting in a 60% slump to current levels.

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This price zone serves as solid support, however, there may be another dip to the 200 day moving average which lies around the $6.60 level.

Crypto investors have been eyeing the charts and are loading up on LINK which could drive prices back up in the short term. Trader and analyst going by the twitter handle ‘RNB (Crypto Warrior)’ (@CryptoWarrior01), has seen the same chart predicting a bounce back to $10 or $12.

The sentiment has been echoed by fellow trader ‘MacroLINK’ (@MacroCRG), who has also admitted to becoming a ‘LINK Marine’ and entering at these levels.

Further downsides are expected though if markets continue to bleed as they have done for most of this week. Chainlink’s market capitalization is currently just over $3 billion which puts it ahead of Crypto.com but just below Binance Coin according to Coingecko.

Crypto Market Selloff Accelerates

LINK has not been the only token to suffer, however, it has been in a downtrend for around six weeks.

Bitcoin, which is largely the bellwether for the rest of the market, is holding crucial support just below $10,300 at the time of writing. Failure to hold here will see the asset tumble back into four figures pretty quickly.

Ethereum is also in pain, falling to its lowest level for three weeks and crucial support at $325. Many of the lower cap altcoins, especially the DeFi related ones have dumped 50% since their giddy peaks in recent weeks.


To get the daily price analysis, Follow us on TradingView

Author: Martin Young




Martin has been writing on cyber security and infotech for two decades. He has previous forex trading experience and has been covering the blockchain and crypto industry since 2017.

Source: https://coingape.com/link-marines-lock-and-load-as-price-falls-to-six-week-low/

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Blockchain

Bitcoin’s realized cap has increased by more than 50 percent or $43 million

Bitcoin’s realized cap increased by over $43 million Ethereum had a new realized cap low of $22.4 billion in April 2020 This data is more accurate for the long-term investors Data from Glassnode shows Bitcoin’s realized cap is $43 million over its highs in 2017 when traded at $20.000. Bitcoin’s current market capitalization is $190 […]

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  • Bitcoin’s realized cap increased by over $43 million
  • Ethereum had a new realized cap low of $22.4 billion in April 2020
  • This data is more accurate for the long-term investors

Data from Glassnode shows Bitcoin’s realized cap is $43 million over its highs in 2017 when traded at $20.000.

Bitcoin’s current market capitalization is $190 billion. This new high implies that the BTC holders are profiting 65 percent.

Bitcoin’s realized cap shows the last price traded and multiplied by the total supply. For example, if the trader has BTC 100 coins and sells just one for $2, the market cap, in this case, is $200. 

The realized cap is measured by taking all coins at the price they last transacted on-chain. In essence, that’s the price the traders paid for Bitcoin.

That allows analysts to determine the amount of an asset’s original price for market partakers’ tax purposes. The exchanges where all orders, no matter if they are “buy” or “sell” orders, are directed through a central exchange. In other words, centralized exchanges are out of this estimation. So this data is more accurate when we speak about with a longer horizon.

What do the metrics chart show?

Bitcoin's realized cap has increased by more than 50 percent or $43 million 1
Image source: Glassnode

It’s easy to see that the realized cap remained to increased higher in the first quarter of 2018. Also, it is clearly shown the testing $90 billion in the period from January to May. It happened three times, notwithstanding prices having dropped back level lower than $10,000.

Also, the chart shows the Bitcoin’s realized cap was in a steady trend of growth.

How many crypto-addresses are successful?

Another research shows that over 72 percent of them are in profit at this moment. Most investments were made in the price scale from $1,040 to $5,285, and from $8,450 to $9,560.Ethereum tried to recover its previous.s highs.

It was a real struggle. ETH’s realized cap revealed the longer downtrends. In April 2020, it had a new low of $22.4 billion. Also, a smaller number of ETH addresses are profitable, according to available data, it is 62 percent. The most significant number of ETH was sold at $160.

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Gemini exchange now available for UK crypto investors

Gemini exchange has launched in the UK. The exchange will serve both retail and institutional investors. This follows the recent EMI license awarded to the company by FCA. Cryptocurrency investors in the United Kingdom (UK) will now be able to access Gemini’s suite of digital currency services. The cryptocurrency exchange said in a press statement […]

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  • Gemini exchange has launched in the UK.
  • The exchange will serve both retail and institutional investors.
  • This follows the recent EMI license awarded to the company by FCA.

Cryptocurrency investors in the United Kingdom (UK) will now be able to access Gemini’s suite of digital currency services. The cryptocurrency exchange said in a press statement that it has fully launched in the country. The Gemini exchange launch in the UK was said to be a part of its plan to expand its operations globally.

Gemini exchange launches in the UK

Following the recent announcement, both the retail and institutional UK investors can access Gemini exchange for services like crypto trading, custody services, and market data, all in their local currency. The exchange will reportedly offer additional features for the UK residents, such as local support and faster means of funding their accounts in pounds sterling (GBP), thereby avoiding exchange rate fees.

The UK is a global center of financial innovation with a stringent and progressive regulatory regime,” said Tyler Winklevoss, the CEO of Gemini exchange. “Going live with our full services available in GBP in the UK is another exciting step forward in Gemini’s international expansion, advancing our mission to empower individuals and organizations around the world through crypto.

Gemini registration in the UK

The launching of Gemini exchange in the United Kingdom follows the recent Electronic Money Institution (EMI) license that was awarded to the company by the UK’s Financial Conduct Authority (FCA). The exchange will be operating in full compliance with the regulator, given that it also received FCA’s approval under the Fifth Money Laundering Directive (5MLD) crypto-asset registration process.

As Cryptopolitan reported, two Gemini entities, namely Gemini Europe and Gemini Europe Services was approved in August and have been enlisted on FCA’s website as registered companies. Gemini Europe Services manages the exchange and custodian operation in Europe, while Gemini Europe facilitates e-money services.

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