What are Trading Bots?
Trading Bots in the web3 space are automated software tools designed to execute trades on decentralized exchanges (DEXs) and other blockchain-based trading platforms. These tools use predefined strategies, algorithms, or machine learning models to buy and sell digital assets without manual intervention. The category includes bots for arbitrage, market making, trend following, and liquidity provision, among others. Primary users are developers building trading strategies, quantitative traders, and DeFi projects seeking to optimize asset management or provide automated trading services. Key characteristics include real-time market data integration, smart contract interaction, customizable strategy parameters, and risk management features. Subcategories may include arbitrage bots, market-making bots, and portfolio rebalancing bots. Developers should explore trading bot tools when they need to automate trading operations, improve execution speed, or implement complex strategies that are impractical to perform manually.