Bots & Trading Strategies

Bots often outperform manual trading in liquidity and volume generation

Although no actual transactions occur in zkMakers, certain trading strategies can generate more volume and liquidity, and therefore, higher rewards.

Automated bot trading tends to generate more volume and liquidity than manual trading. Traders may use any type of bot to implement their strategies.

The use of bots is optional for traders and is not required to certify trading activity.

Market Making

High frequency trading involves continuously placing orders on both sides of the order book to profit from the spread, or difference between the bid (buy) and ask (sell) orders.

This strategy is used by institutional investors such as brokerage houses, hedge funds, and banks and generates high quality liquidity and depth.

Arbitrage

Arbitrage involves buying an asset on one exchange and selling it on a different exchange to profit from the price difference.

This strategy is used to ensure that asset prices do not diverge significantly between exchanges. The fragmentation of the cryptocurrency market offers opportunities to profit from the price of a token and volatility on different exchanges.

Grid Trading

Grid trading is a strategy that uses multiple orders to capture price movements within a range of prices. This strategy is popular among bot trading platforms due to its ease of use and setup.