Cryptocurrency Trading Trends: What to Watch in 2024
The biggest current trend is using artificial intelligence in everything. While some believe that it’s just a fad, others are trying to implement it in all aspects of life. Contemporary algorithmic crypto trading is right on time for the party. With thousands of retail traders experimenting with new exciting financial products from automation vendors, it is certain that the future will bring more refined tools to work with. We believe that there is only one big trend in the whole industry — automation. However, it comes in different shapes and forms. Let’s discuss various ways you can use algorithmic crypto trading software to your advantage in 2024. And see what are the latest cryptocurrency trading trends.
The loudest word of the year is the AI
Artificial Intelligence became a new phenomenon that penetrated the collective mind of the world at the end of 2022 with ChatGPT becoming the fastest growing application. It was only the beginning of the craze that consumed everyone. The sheer volume of investment in this sector of the global economy is mind-boggling.
In 2024, the value of the AI market reached an astounding $136 billion. It is expected to grow even bigger and reach almost half a trillion US dollars in 2025. Current projections may seem slightly optimistic, but even if the hype is unreasonable, the total volume of real investments in the sector will push its growth against all odds in the foreseeable future.
There are many other important statistics that you should keep in mind when thinking about the use of artificial intelligence in the global economy and the financial sector. Here are some numbers for crunching:
The growth of the sector is expected to stabilize at 120% year-on-year starting next year. By 2025, more than 97 million people will be working in this expanding space.
83% of companies surveyed on the topic believe that the implementation of AI technologies is their main priority for the near future. Some 48% of companies already use advanced AI systems.
The most astounding statistic is that 97% of all surveyed businessmen said that they believe that ChatGPT and similar systems will be helpful in developing their businesses.
85% of all trading including HFT and even retail sector is controlled by various automatic systems with elements of artificial intelligence. 54% of all fund managers and financiers believe that AI will affect the way we are managing portfolios and risks.
The global AI portfolio management market is expected to grow to $11.6 billion by the end of 2024 with many companies offering a wide range of different services to help fund managers achieve better portfolio performance.
There is no denying: artificial intelligence is all people can talk about when it comes to any industry. The same is happening in the world of cryptocurrencies. Not only are many AI-oriented DeFi platforms are shaping up to become some of the most valuable companies in the blockchain industry, but there are also unique applications for the AI tech in the automation sector.
Companies like CryptoHopper and WunderTrading are heavily invested in designing new automation tools that utilize the power of machine learning and implement new exciting services in their product lineups. These platforms often define the landscape of the sector and dictate crypto trading trends that rule over the market. Here are some of such trends that have already taken the shape of definitive trading tools.
Using finely tuned preset solutions for crypto trading
The place of automation in the world of financial markets has always been undefined. There are many ways of looking at the industry. Here are some of them:
Some people believe that it’s best used for complex strategies such as statistical arbitrage and pairs trading where one needs to spend a lot of time analyzing the market and searching for suitable assets to implement in the system while bots do the trading.
Many people saw the potential of using social trading products in the sector. With web 2.0 completely overtaking the internet by the 2010s, many retail traders turned to copy trading and other forms of social trading. While it is a good way to start your journey in the world of crypto, we don’t believe that copy trading is representative of what automation is capable off.
The third group of automation enthusiasts focused on building custom automated crypto algorithmic trading systems based on their personal technical analysis approaches that they refined over time. With the arrival of the TradingView platform, millions of people around the world were able to share their analytical ideas and identify those that work well and see what are the latest cryptocurrency trading trends.
The growing number of retail traders and conservative crypto investors are looking at the growing selection of finely tuned preset bot options and incorporating them into their portfolios. These crypto algorithmic trading strategies utilize time-tested approaches such as Distributed Cost Average (buying or actively trading), Intramarket Arbitrage, GRID trading (one of WUnderTrading’s flagship products), and more.
The advantages of using preset bots are endless. You don’t really need to look for a strategy that will work, tinkering with bot settings is enough to make it work well. The only thing that an investor must do is manage risks. This task is still the responsibility of a retail trader using automated trading systems and no one else’s.
Using bots to diversify your portfolio
Diversification is the most important thing that an investor can focus on to reduce potential losses and create a consistent portfolio. However, some people believe that diversifying finances across multiple classes is not the best idea given the current global financial situation. As more people choose cryptocurrencies as a relatively safe bet against the inflation of fiat money, the idea of diversifying within the blockchain industry becomes more popular.
Here are some ways you can use automation to diversify your crypto portfolio:
Utilize copy trading bots to align your investment risk profile with your preferences. Choose managers at different risk levels to diversify your portfolio, using bots for either high-risk, high-reward or safer trades. For low-yield portfolios, riskier bots can offer significant returns, while safer traders suit high-risk assets. Incorporate systems like DCA and GRID for added consistency and risk management, ideal for gradual asset accumulation or as a low-risk element in volatile portfolios.
Statistical arbitrage can be extremely useful. People who understand financial analysis and can identify correlated digital assets that can form the foundation of a large statistical arbitrage trading system will be able to use algorithmic crypto trading software to manage their whole portfolio. The bots will follow rules established in your statistical arbitrage strategy to maintain a healthy balance of assets.
These methods are quite trendy and will remain attracting more people. We believe that the growth of the crypto market will fuel the expansion of the concept of diversifying a portfolio with AI and automated trading systems. People who learn more about how to do it properly will outpace the market and have a sizable advantage over those who ignore one of the most important crypto trading trends in 2024!
Cryptocurrency trading trends in the cryptocurrency world
We discussed some of the most important developments in the automation sector to illustrate some of the trends related to the concept of trading in particular. However, there are some market trends that are quite important to watch in 2024. Especially, if you want to use automation and other portfolio management tools.
Here are some important cryptocurrency trading trends:
Mainstream tokens continue gaining value. Bitcoin and Ethereum look quite strong in 2024 despite the horrible last year. They are up 63% and 40% respectively. It is important to note that some other significant tokens also gained momentum. Ripple and Monero have been performing well too despite some issues with regulators in various countries.
Staking is not as big as many believed it would be. The introduction of staking to the Ethereum platform did not affect its prices that much. Compared to Bitcoin, it performed slightly worse.
The landscape of the crypto market may change dramatically. The SEC continues pursuing regulation for the crypto sector of the financial world. The same is happening in some European markets. However, the biggest news is that Binance may be in trouble. Don’t panic as there are still many centralized exchanges that follow KYC and AML practices and also conduct audits. However, the shape of the crypto market may significantly change within a couple of months.
The market is shifting away from up and coming DeFi tokens. The craze around the world of DeFi is following the same trajectory as the hype surrounding NFTs but slower. We see that new DeFi tokens have to prove their utility before people start investing in them.