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Crypto Knowledge Base

Botsfolio Bot Review

Crypto investing shows a lot of promise but there are hurdles for beginners to overcome. Enter Botsfolio, attempting to make crypto more accessible.

Botsfolio is a trading app that’s been designed to automate crypto portfolio building and futures trading. It’s aimed at newcomers who don’t understand the market yet, so in a nutshell:

  • It doesn’t need configuring beyond setting the level of risk
  • Good security. Assets stay at the exchange.
  • Only available for Binance at the moment.
  • Prices vary according to the value of your assets that the bots have to manage. The more they manage the more it costs.

Crypto trading bots for all

Cryptocurrencies have captured the public imagination of late. They’ve found their way into mainstream news, usually under headlines marvelling at the massive rises in Bitcoin’s value and ordinary people becoming millionaires overnight.

But that doesn’t mean that they’ve become accepted as mature investments on a par with the stock market. As with anything new that comes along with big promises they are still viewed with some suspicion. They are still seen as difficult to access and the fact that they are highly volatile assets that are backed by nothing other than market sentiment has made them something of a hard sell to the general population.

But those perceptions are starting to change as more people take the plunge, following in the footsteps of big-name investors like Elon Musk, who committed Tesla to a $1.5 billion bitcoin purchase in February 2021.

Still, for those new investors who have dipped a toe in the bitcoin waters, one of the main stumbling blocks they encounter is timing their entry and exit points. An asset that can fall 40% overnight requires nerves of steel but now Botsfolio is promising that its automation features mean you can leave the sleepless nights behind, but can you trust it?

Crypto trading for beginners

Botsfolio automates trading and it’s been specifically designed for cryptocurrencies. The idea of automated trading is that you don’t need any technical knowledge to use it.

To get started you need to link your Binance account to Botsfolio, and then you’re supposed to set its trading bots loose on buying and selling popular cryptos like bitcoin and ether. It’s an attractive proposition because you don’t need to configure them at any point, so there’s no need to worry about strategy or taking a deep dive into their settings.

In the same way that apps like Wealthsimple can spread your investments across various index funds, Botsfolio uses a range of bots to handle the strategic workload, to give you a diversified approach to crypto investing that’s inherently safer than speculating with all your currency eggs in the same basket.

The focus of each Botsfolio bot is different:

  • Long bot — slowly spreads 80-90% of your portfolio across 10 likely-looking assets, taking long positions and diversifying according to different factors and use cases.
  • Scalper bot — uses small price fluctuations to scalp, so you could pick up a few dollars from this one every few hours.
  • Swinger bot — homes in on price swings in one direction and takes larger positions over longer time frames to pick up profits a few times a month.
  • Trendy Bot — looks for prices that are clearly only ranging within certain pounds. It stands ready to jump in when there’s evidence of a clear trend.
  • Hedge Bot — reacts to periods of high volatility with hedged positions and picks up income from futures. Then, when the asset settles on a clear direction it cancels the redundant part of that trade.

Cutting risk for amateur investors

Botsfolio aims to attract more nonprofessional investors to crypto by cutting out some of the risk factors that make them wary.

  • The bots are adept enough to use hedging to maintain your portfolio value when the market is very volatile, assuming your risk level lets them.
  • If you’re a bit more risk-averse, Botsfolio can use straddled trades to pick up fixed amounts from your position, at the same time removing risks associated with price movement.
  • Futures trading can be risky so the bots only commit a small chunk of your capital. They avoid the most significant threat—that of liquidation with automatic stop-losses.
  • If the portfolio’s net value should drop below the level of your starting investment, the bots know to lower your level of risk, using smaller amounts and not executing as many trades in order to chip away at the deficit until they get you back to your starting investment amount. We liked this feature but we hope it isn’t an admission that Botsfolio isn’t likely to put you in this position!

For and against points

For

  • You don’t need to worry about strategy or settings.
  • It’s patient enough to build you a diverse portfolio, picking the best moments to buy and sell.
  • It only trades futures when your risk level permits it to and an obvious market trend has become apparent.
  • It will opt for hedged positions to make money when markets are heading sideways.
  • Provides good value compared to competitors’ offerings.

Against

  • Only works with Binance right now but you might see other exchanges being added further down the line.
  • You’ll need to put in 1000 Tether to get set up.
  • In our test, it tended to trade the ETH/USDT pair on futures.

Performance

The way that tools like this perform will vary according to a range of different factors, including market conditions, amount invested, and risk profile. For this review, we were only able to test futures trading, and in this regard it averaged an impressive 7 out of 10 trades that managed to make a profit, yielding an average of 5.5% return on net investment (a month) or 66% over the course of a year.

Remember that these results were only for futures trading and that this represented only 10-20% of our net investment. The bots didn’t see any good chances to buy while we were testing which means that most of our money wasn’t in play. Perhaps if we’d stuck around longer we might have seen the bots buying tokens for the portfolio, although we’d obviously have had to wait a long time to see any results.

Pricing

The base tier costs $18 a month for looking after $1000 worth of investment, rising to $20 a month once it’s using all of your capital in the portfolio. This is significantly cheaper than the majority of similar services, and unlike them, it looks after all the setup parameters for you. That could make it quite an attractive option if you’re happy to let an algorithm play with your cash.

The price goes up in tandem with the portfolio value, topping out at $72 per month when your portfolio hits the $50,000 Mark.

Security

All your trading takes place on Binance and that’s where your assets stay. The bots work through an API that connects to the exchange, but its Withdraw function is disabled so that nobody can use it to steal your assets. The API keys are encrypted for greater security too, so even if a hacker steals them, we can’t see any way for them to send your money to another wallet.

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