Crypto trading bots are used by many experienced traders who want to up the ante by deploying automated trading strategies. Some of the biggest exchanges support automated trading in order to help their users get the most of their account. But the question is: does Kraken allow trading bots?
Kraken is one of the oldest exchanges in the cryptocurrency market. After 11 years of existence, it would be a surprise if the exchange didn’t support one of the hottest features in crypto. In this article, I’m showing you how to use a crypto trading bot on Kraken and connect your API keys to 3rd-party trading software.
What is Kraken?
Kraken is a cryptocurrency exchange based in the United States that launched in 2011. The exchange is led by Crypto Twitter’s beloved decentralization-proponent Jesse Powell. At the time of writing, Kraken is ranked fourth on CoinMarketCap’s leaderboard for spot exchanges. The exchange processes up to a billion dollars in daily trading volume.
Kraken owes its popularity to its rich liquidity and large token offering. The exchange also offers some of the lowest fees and features minimal slippage on spot trading pairs. Kraken is especially good for deploying trading algorithms that automate your strategy. Shrimpy users are free to link their Kraken account and use crypto trading bots.
Does Kraken Allow Crypto Trading Bots?
As of 2022, Kraken still supports crypto trading bots. Kraken users are free to use either REST or WebSocket APIs to deploy their custom trading bots. But if you do not wish to code your own trading bot, you can try out third party platforms.
At the time of writing, Kraken supports the following crypto trading bot platforms:
Kraken has published a trading bot code example that developers can explore to discover how to implement a trading bot using Kraken’s APIs. The google drive folder linked here contains code for a stable coin trading bot written in python.
About Shrimpy Crypto Trading Bots
Shrimpy is an automated portfolio management platform that offers crypto trading bots and other automated trading features. Shrimpy allows you to manage your entire crypto portfolio in one place. You can link more than 30 exchange accounts and wallets to easily manage your assets, track your performance, analyze the market, and trade assets.
Shrimpy is a popular crypto trading bot due to its rich list of features, reliable server infrastructure, and user-friendly interface.
Shrimpy supports Kraken and allows you to link your account via API keys. Once you connect your exchange account, you can:
Backtest automated strategies
Deploy portfolio stop loss
Create custom index funds
Manage all your linked exchange accounts
Users can also join our social trading platform and copy trade some of the market’s best crypto traders.
Security is every trader’s first priority. Providing another platform with access to your funds can be a frightening thought. But you’ll no longer have any fear after you understand just how secure crypto trading bots are.
Kraken uses API keys to connect your exchange account to a third party trading platform. API keys represent a form of authentication that two or more platforms use to confirm your identity. Think of it as using a private key to confirm a blockchain transaction or to obtain access to your account.
You generate your API keys directly on Kraken. As long as you don’t share your public and private keys with anyone, no one will have access to your funds except you.
Another reason to not worry about security is the fact that you can adjust permissions for your API keys. For example, you can decide that the other platform only reads your account data or executes trades on specific markets (e.g. futures). You can even disable withdrawals and prevent the other party from moving your portfolio’s assets.
To conclude: there is nothing to worry about when using crypto trading bots on Kraken. As long as you keep your keys safe, interact exclusively with trusted bots, and disable withdrawals, your coins will stay with you.
How to use a Crypto Trading Bot on Kraken With Shrimpy
The first step to using crypto trading bots on your Kraken account with Shrimpy is to generate your API keys. I recommend following our simple guide at the following link to find out more about generating API keys on Kraken.
After generating your keys, the next step is to link your Kraken account to Shrimpy. You can do so by logging into Shrimpy, clicking on your username and pressing the ‘Add Account’ button. You will then head to the settings page.
At the settings page, click the ‘Link exchange’ button and select Kraken from the list as shown in the image below. The next step is to copy and paste your public and secret API key. Next, click save, and Shrimpy will complete linking your Kraken account.
Now that the linking process is complete, you will soon find your Kraken portfolio data on the Shrimpy dashboard. From the dashboard, you can monitor your portfolio, execute trades, rebalance your portfolio, and do much more.
I suggest starting by visiting the “Automation” tab located at the left part of your screen.On this tab, you can create a portfolio and include the assets that you’ll automate by clicking the ‘Add Assets’ button. Besides automating a portfolio, you can also create a custom index fund.
Portfolio rebalancing is Shrimpy’s primary area of expertise. It represents our best and most advanced trading bot. You can rebalance your portfolio by setting initial allocation targets for each asset you own. You can see an example of a portfolio and its allocation in the image below:
After setting allocations, it’s time to adjust your rebalancing strategy. Under ‘Rebalance Strategy,’ pick periodic or threshold rebalancing. Periodic rebalancing adjusts your portfolio on a fixed time basis (daily, weekly, monthly). Threshold rebalancing adjusts your portfolio once an asset’s allocation drifts too far from its original allocation (e.g. +7%).
You can set an hourly, daily, and weekly rebalancing time-basis next to the periodic rebalancing option. And next to the threshold, you can type in any number for your rebalancing threshold.
To protect your portfolio from unexpected market disturbances, you can set up a portfolio stop loss in the stop loss section. You can read more about portfolio stop loss orders in this article. You can adjust the stop loss time period, the threshold after which the stop loss order activates, and the stablecoin currency into which your assets will convert.
Unless you want to make any other changes, you are now done setting up your automated rebalancing strategy. You can deploy the strategy by clicking the ‘Start Automation’ button.
That’s it! You’ve successfully deployed a crypto trading bot on Shrimpy for your Kraken account. If you want to learn more about using Shrimpy’s other features, I recommend reading the following articles:
Marko is a crypto enthusiast who has been involved in the blockchain industry since 2018. When not charting, tweeting on CT, or researching Solana NFTs, he likes to read about psychology, InfoSec, and geopolitics.