The Ultimate Guide to Cryptocurrency Trading Tools
The cryptocurrency market grew from $193 billion in Q1 2020 to $668 in Q4 2020, with Bitcoin adding over $300 billion to its market cap in 2020. Overall, the crypto market cap grew by more than 3.3 times, evidencing that cryptocurrencies are hitting mainstream adoption. Amidst the growth of crypto trading, developers have come up with several tools, including portfolio managers, wallets, market watchers, portfolio balances, crypto news aggregators, and exchanges, to make trading straightforward and profitable minimizing risk.
Using the right set of crypto trading tools coupled with a proper trading mindset is crucial to realize success in cryptocurrency trading. Here is a guide to cryptocurrency trading tools you should consider using in 2021 and beyond to take your trading to the next level.
Why You Need Them: To buy or trade cryptocurrencies
Cryptocurrency exchanges offer a gateway to the cryptocurrency world by allowing investors to trade cryptocurrencies for other assets such as other digital currencies, conventional fiat money. Crypto exchanges may accept various payment forms, including wire transfers, credit cards, or other payment forms deemed safe and convenient. The crypto space is no short of exchanges that take different forms. Some function like market makers simply taking the bid-ask spreads as a commission for the exchange service offered. In contrast, others act as matching platforms (i.e., linking buyers and sellers) and charging a transaction fee. Some cryptocurrency exchanges also integrate traditional assets such as stocks and fiat currencies. When choosing an ideal cryptocurrency exchange, you should consider security, transaction fees, and liquidity or exchange volume. The best crypto exchanges you should consider are:
Founded in 2012, Coinbase is one of the most trusted and reliable cryptocurrency exchanges holding over $20 billion in assets with a trading volume of over $50 billion. The best thing about this exchange is that it allows crypto purchases using fiat currencies, plus it’s beginner-friendly. In terms of security, the Coinbase exchange has never been hacked and has been licensed by over 40 regulatory bodies to operate in the US and other 31 countries worldwide. Besides, users’ funds (up to $250 000) are insured by FDIC.
Coinbase also packs plenty of features, including an instant exchange feature with no extra fees, the Shift Card (Coinbase debit card), and supports crypto withdrawals to users’ wallets. The exchange also offers an in-built crypto wallet, which is very safe since 99% of users’ assets are stored in offline cold storage. The remaining 1% of the assets is stored in the online hot wallet is insured in hacking. If you’re looking for an easy way of buying, selling, and storing cryptocurrencies such as Bitcoin, Ethereum, Litecoin, and more, Coinbase is among the top options. However, note that it’s not available across the globe, plus it has limited listed coins.
Binance is another outstanding crypto exchange with the highest trading volume in the crypto space averaging $ 1 billion trades. The exchange supports over 100 different cryptocurrencies with a meager exchange fee of about 0.1% and a 50% trading discount when using its native coin, i.e., Binance Coin (BNB). Regarding security, Binance is entirely secure, boasting security features such as two-factor authentication (2FA) and CryptoCurrency Security Standard (CCSS).
The exchange is relatively fast, supporting up to 1.4 million transactions per second. Binance accepts crypto-fiat purchases meaning that users can purchase crypto using multiple currencies, including EUR, USD, and GBP, with no limitations. Binance is excellent for beginners and advanced users as it offers two options, i.e., Basic and Advanced. Easy to use interface coupled with low trading fees and extensive supported digital currencies make Binance among the top crypto exchanges.
Why You Need Them: To access multiple crypto exchanges on a single platform
Sometimes, you may want to use multiple exchanges to trade your crypto portfolio, maybe due to different listed prices, or you prefer to trade a particular coin on a specific exchange. Logging in and out of exchanges can be quite cumbersome. Trading platforms streamline your crypto trading experience by providing a single platform to access all your exchanges and execute trades. This allows you to waste no time executing trades when opportunities arise and allow you to monitor the market closely. Suitable trading platforms you may consider are:
Launched in 2014, Coinigy is among the leading trading platforms in the crypto space. The platform supports over 45 exchanges and features customizable trading charts as well as constructive customer support. It also features historical crypto market data, which can be purchased and used to analyze the market.
Coinigy is available on the web and as an app (Android and IOS). It allows you to manage your multiple exchange accounts from a single platform. The platform also features portfolio monitoring tools and real-time crypto market insights to take your trading game to the next level. It offers a 30-day free trial, after which memberships are charged from $ 18.66 to $99.99/month.
Altrady is also another excellent trading platform that supports over twenty crypto exchanges. The platform packs plenty of features, including a user-friendly interface, personalized layouts & moveable widgets, easy navigation, multiple market tabs, high-definition interactive charting, automatic portfolio manager, crypto base scanner, real-time crypto alerts, and break-even calculator, among other features.
Why You Need Them: For technical analysis
Charting tools allow crypto traders to check out indicators and draw trend lines to determine their direction. Using charting tools, you can conduct technical analysis (TA) to gauge a downtrend or an uptrend. Essential charting tools in the crypto space include:
TradingView is one of the best charting tools in the crypto and stocks market. The tool is quite popular with crypto traders. It offers different forms of charts, including line charts and candlestick patterns. It consists of a comprehensive list of technical indicators to enable traders to analyze the market and develop a profitable trading strategy. TradingView also integrates a unique chat function to allow traders to share trading strategies with their counterparts. Some features of the tool are free, while others are unlocked to premium users.
Cryptowat.ch is another great charting tool in the crypto space. The tool is owned by Kraken exchange and offers over ten charts in a single view. The tool also has an in-built trading platform, but users must pay a subscription fee to use it. The charts can be customized and come with several drawing tools.
Cryptocurrency Market Stats Tools
Why You Need It: To check out crucial statistics and reference points
Cryptocurrency market data such as total supply, circulating supply, market capitalization, etc., are vital in the crypto markets. Market data providers allow traders to easily analyze a coin and determine whether it’s suitable for investments. Best crypto market data include:
CoinMarketCap is a comprehensive crypto market data platform providing a comprehensive data set including trading volume, official website, cryptocurrency token’s prices, market cap, 24 hours and seven days trading volume, the supply of coins, etc. It also features individual charts for each coin and an API if an individual wants to integrate crypto market data to their own interfaces.
CryptoCompare is another excellent crypto market data platform that offers reliable data, including prices, volume, and coins supply. The platform also consists of tools that allow users to track their portfolios. Plus, there are new articles on the development of different coins.
Cryptocurrency News Aggregator
Why You Need Them: Real-time updates regarding crypto markets.
Fundamental analysis is crucial in the crypto space to come up with a profitable trading strategy. Crypto news, both legitimate and rumors or fake news, affect coin prices in some way. Tons of crypto-related news emerge every hour, making it very difficult to keep up with the market’s happenings. Crypto news aggregator tools come in handy to keep you posted on the latest crypto news from a single platform. Best news aggregator tools/sites are:
CryptoPanic is a free, comprehensive crypto-news aggregator with multiple news sources, including social media news, online news articles, polls, etc. Users can customize which news they would like to be updated on. Additionally, it features a price bar where users get the latest coin price updates.
CryptoSpectator is very similar to CryptoPanic but comes with more features. For instance, it allows users to vote on how the market will behave regarding particular news. This allows users to get a rough idea of whether the market will be bullish or bearish.
Crypto Events Calendar
Why You Need Them: To be aware of upcoming events that can influence a coin’s price.
Calendar tools keep you updated on the latest developments of a particular coin and the upcoming events such as Halving in the case of Bitcoin. If you want to know what’s happening to a particular coin, whether coin burns, forks, exchange delisting, or crypto-related conferences and events, you can find it all under a single platform. Suitable crypto events calendar include:
CoinMarketCal gives you a bird’s eye view on the upcoming crypto events on all major coins, including beta, alpha release, Mainnet or testnet launches, airdrops, and launch of new features or listings. Additionally, users can set up their own events. However, if you add your event, it won’t be approved by the site’s admin but passed to the community to vote whether legitimate or fake.
Coindar also lets you view all upcoming events in the crypto space under a simple, sleek interface. Users can also post events and also notify you of significant upcoming events via Telegram and Twitter. Choose between dark mode and light mode interface options.
Why You Need Them: To execute trades when certain conditions are met automatically.
Trading bots have gained widespread usage in the crypto space among both experienced and beginner traders. Beginners employ trading bots to automate their crypto trade, while expert traders use the tool to execute trades at particular conditions in a market that runs 24/7. Using the right trading strategy coupled with a reliable trading bot, you can easily rake in lucrative profits even as you sleep. The crypto market is awash with hundreds of trading bots, and you really need to choose one that complements your trading strategy. Here are some trading bots you should try out.
Cryptohopper is among the best trading bots available in the market today, with a myriad of handy features to enable users to execute their trading strategies in a bullish and bearish market. In addition to automatic trading features, some ideal features on the platform include mirror trading, arbitrage trading, backtesting, and more. Users can customize their trading strategies by accessing several technical tools available on the platform.
HaasOnline is undoubtedly among the best crypto trading bots with outstanding features, including a sleek user-interface, arbitrage trading, and access to hundreds of technical indicators. This tool offers top-notch automated trading solutions that allow users to profit to a great extent.
Crypto Tax Tools
Why You Need Them: To generate and file crypto tax reports.
Several countries have already implemented cryptocurrency taxations creating the need for tax management tools. Manually determining cryptocurrency taxes can be challenging given that regulators are yet to implement precise, multi-coin guidelines. Crypto tax software can undertake all your crypto tax calculations on your behalf as you focus on other investment tasks. Filing wrong tax returns are considered tax evasion, which is a severe offense leading to unwarranted fines and/or penalties or even imprisonments. Ensure you use the below tools to calculate and manage your crypto taxes. Note that most crypto tax tools have tiered pricing costing up to $600 per year.
Zenledger is a top of the class cryptocurrency tax tool that automatically generates ready-to-file crypto tax information adhering to the IRS standards. The tool features an API, enabling you to import all your historical data from several leading crypto exchanges to obtain an accurate tax report. The software also reports on capital gains, profit-and-loss as well as crypto donations you might have made. Zenledger will enable you to come up with an accurate ready-to-file tax report with no much complexity involved.
CryptoTrader.Tax is another handy crypto taxation software that generates crypto tax reports directly uploaded to TurboTax for seamless filing. It also generates IRS Form 8949 Form cryptocurrency income and/or loss plus allows users to easily calculate gain/loss exposure.
Cryptocurrency Portfolio Trackers
Why You Need Them: To Keep Track of Your Portfolio
As a trader, you should always be aware of your portfolio’s performance, and there’s no better tool to help you other than portfolio trackers. Cryptocurrencies are very volatile; therefore, it’s hard to manually keep track of each coin you’re investing in by updating prices in an Excel spreadsheet. Portfolio trackers allow you to see the value of your assets in real-time. Given that these tools are vulnerable to hackers, it’s crucial to choose a portfolio tracker with outstanding security features and other handy features ideal for your crypto trading needs. Best portfolio trackers are:
Blockfolio is a favorite portfolio tracker among crypto traders thanks to an intuitive, sleek user-interface, signals, and news section. The tracker is available as an app available in Google Play and App Stores and allows you to track over 3 000 different coins across over 100 exchanges. You can track different cryptocurrencies on the platform by pinning them on a customized dashboard and viewing them on a simplified graph. Additionally, you can track order books, set alarms for real-time price changes, and submit your trades’ data, including price, amount, and market, to know exactly how much you’ve earned from a particular trade. While you have to enter data manually, this is an excellent feat in regards to security.
Blockfolio is a must-have crypto trading tool if you’re trading multiple coins to keep track of each coin’s performance in your portfolio. Better yet, the app is absolutely free.
Delta is an excellent crypto portfolio tracker allowing you to effectively track all your coins in over 300 crypto exchanges and wallets. You can access liver prices of all cryptocurrencies and other investment assets such as ETFs, stocks, indices, mutual funds, forex, bonds, options, and futures on the tracking app. The app is available for free download on Apple Store and Android Store.
Portfolio Rebalancing Tools
Why You Need Them: To buy and sell coins based on portfolio weight automatically.
Portfolio rebalancing is a necessary crypto trading strategy if you’re looking to minimize risk and maintain a continuous profit stream. Portfolio rebalancing tools automatically buy and sell assets in your portfolio to maintain the set portfolio allocation. For instance, if you want Bitcoin always to be worth 50% of your portfolio, but Bitcoin’s price rises, increasing its worth to be 70% of the portfolio, rebalancing tools will automatically sell out some BTC to bring it back to 50%-the vice versa is also true.
Portfolio rebalancing tools come in handy to hedge your assets, ensuring you continually generate profit. The best rebalancing tools are:
Shrimpy is certainly the best portfolio rebalancing tool in the crypto space. Unlike other portfolio rebalancing tools in the crypto space, Shrimpy doesn’t rely on signals and trading indicators to rebalance users’ portfolios. Instead, it employs dollar-cost averaging, which is very effective. The platform offers two types of portfolio rebalancing: periodic rebalancing and threshold rebalancing. Users need to integrate the platform into their exchanges or wallets. The platform will automatically buy/sell cryptos in each cycle (hours, days, or weeks) as per the set goals or classifications.
Apart from portfolio rebalancing, Shrimpy offers additional services, which make it a comprehensive tool. Additional services offered on the platform include backtesting, performance tracking, crypto indexing, crypto trading, and market data API for developers. The platform is available for free, but there is a professional package with additional features billed at $19/month or $13 per annum. Major crypto exchanges support, great customer service, a wide range of features, and top-notch security makes Shrimpy the best portfolio rebalancing tool.
Unlike Shrimpy, 3Commas is not free but comes with some excellent features for your crypto rebalancing. The tool is compatible with crypto exchanges such as Bittrex, Poloniex, Binance, and many others via a single interface. Apart from rebalancing, 3Commas comes with smart trading features such as a crypto trading bot, trailing stop-loss, and trailing take-profit, as well as social trading, to enable users to grow their portfolios.
DeFi Risk Assessment Tools
Why You Need Them: To determine whether a certain crypto project legit or an exit scam in the DeFi space.
Investing in new cryptocurrency projects is risky, considering numerous projects were exit scams out to con unsuspecting investors. Risk assessment tools analyze various aspects of a crypto project to determine whether a project is legit or a scam. Therefore, before investing in any crypto project, whether a wallet, an exchange, or an ICO, you’ll want to use these tools to check out the suitability of investing in them.
Unicrypt is a blockchain ecosystem and liquidity locking mechanism that seeks to build investors’ confidence by enabling them to establish whether a project is a viable investment or a scam. Unicrypt was developed to work in line with liquidity pools on Uniswap and provides rewards to farmers for providing liquidity to Uniswap using UNCL and UNCX tokens. The platform features various protocols that are designed to build trust in the crypto sector.
In essence, Unicrypt seeks to reduce the risk associated with Uniswap purchases through its unique liquidity locking mechanism. By leveraging the platform’s locking mechanism and advanced smart contracts, investors are guaranteed that new projects cannot pull off an exit scam. Similarly, new crypto projects build confidence in investors by locking their liquidity for an agreed time before the platform officially goes live. As such, the platform drastically reduces the risk of exit scams in the crypto space.
DEXTools allows investors to explore and analyze DeFi projects before investing in them easily. The platform features several insights, unique functions, data analytics, and insights to help traders gauge DeFi platforms. The platform’s unique features include UniSwap pool explorer, UniSwap pair explorer, BigSwap explorer, and a multi swap feature. There is also a wallet info tool to enable investors to search and compare various wallets. The platform enables investors to explore various projects, check out their history, and determine a market dump’s possibilities on the safe investing side.
When it comes to crypto trading, being well-informed of vital news happenings and catching trends before they break really matters can be the difference between a win and loss. Using the above tools will definitely give you an edge over other traders, ensuring you realize success in the hugely competitive sector. Obviously, there are other tools available in the space but the ones discussed here are most reliable and leading in their particular fields. Try out these tools today to take your cryptocurrency trading to the next level.