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What Is an API and How Do You Use It To Trade?

  An application programming interface (API) is a software bridge that allows computers to communicate and execute tasks with each other. You can think of it as a language translator for computers. Summary An application programming interface (API) is a software bridge that allows computers to communicate and execute tasks with each other. APIs act as computer-to-computer code translators to carry out increasingly complex tasks at hyperkinetic speeds impossible for humans to replicate. Indeed, without API trading, crypto exchanges would be unable to offer customers the depth and breadth of services they provide. Without APIs, algorithmic and AI trading strategies would not be possible. Contents What Can an API Do? Top APIs for Crypto Traders Who Can Benefit From API Trading? Algorithmic Trading: Welcome to Robo-Trades Basic Algo Trading Strategies Trend following Arbitrage opportunities Index fund rebalancing Will Artificial Intelligence (AI) Replace Traders? An  application programmin

Pros and Cons of Automated Trading Systems

  Are you ready to trust your trading strategy to bots? Read about the advantages and disadvantages of algorithmic (algo) trading. Summary Automated, or algorithmic (algo), systems across all asset classes execute pre-set orders that can exclude the influence of human emotion or market swings. This is one advantage of algo trading, as emotional trading can result in overtrading, which in turn can trigger losses. Another benefit of algo trading is that a computer-managed system lets you trade multiple accounts and strategies simultaneously. Algo trading can help to reduce the incidence of mistakes made by humans when placing trades and can identify profit and loss (P&L) opportunities much faster than a human trader. Algorithmic trading is not for novice traders. It relies on expensive, complex software and takes place primarily at large investment banks, hedge funds, proprietary trading firms, and regulated cryptocurrency exchanges. Contents Advantages of Automated Trading Systems D

Understanding Order Management Systems

  Order management systems built specifically for trading digital assets connect to crypto exchanges to offer services tailored to the global crypto market Summary In financial markets, an order management system (OMS) automates and integrates tasks to process the lifecycle of a trade order into a single system. These systems were originally developed to solve for delays and a lack of cohesion in traditional trading firms. Over time, OMS software has integrated increasingly sophisticated features and functions — potentially to support cryptocurrency trading. Contents Understanding Order Management Systems Order Management Systems: Background Recent Developments An Order Management System for Cryptocurrencies Evaluating Cryptocurrency Order Management Services Understanding Order Management Systems In financial markets, an order management system (OMS) automates and integrates tasks to process the lifecycle of a trade order into a single system. These tasks include routing the order to

Crypto Wallets for Beginners: What You Need to Know

  Once you’ve purchased cryptocurrency, you need to decide how you want to store it. Here, we break down crypto wallets. Summary Owning cryptocurrency requires using a crypto wallet to store your funds. There are many different types of crypto wallets. A crypto wallet can be hosted online, or it can be software downloaded on your phone or computer or a specialized piece of hardware, among other options. Regardless of the crypto wallet type, they all store public and private keys which control the associated crypto and allow you to send and receive cryptocurrency. Transactions are then completed on the blockchain using the keys held in your wallet. Contents Understanding Crypto Wallets Hot Wallet, Cold Wallet, or Both? Custodial vs. Non-Custodial Wallets Different Types of Crypto Wallets Wallet Security Best Practices Choose the Best Crypto Wallet For Your Needs Understanding Crypto Wallets There is no perfect  crypto wallet , each different type of crypto wallet has pros and cons. Some

What Are Central Bank Digital Currencies (CBDCs)?

  CBDCs are not cryptocurrencies, even if built on blockchain. They are centralized — controlled by central banks — while crypto is famously decentralized Summary Central banks are responding to the rise of cryptocurrencies and other digital payment technologies by exploring adoption of central bank digital currencies (CBDCs). A CBDC is a digital representation of central bank-issued money that can be built on a blockchain or distributed ledger. Despite potentially sharing some architecture with cryptocurrencies, CBDCs are not considered cryptocurrencies because of certain technical differences and because they are controlled by a central authority. Contents Central Bank Digital Currency Isn’t Crypto Characteristics of CBDCs A  central bank digital currency  (CBDC) is a digital representation of a country’s government-issued, central bank-controlled money. CBDCs are different from the digital reserves and settlement account balances that  central banks , commercial banks, and other fin