Good piece here:
Crypto Trading Bots: How to Choose the Right PlatformThis is my take...
Be extremely careful if:
- They tell you to upload your exchange keys to their online bot.
It's an outright scam if:
- They ask you to transfer funds.
- They tell you their bots are profitable without an audited track record.
- They tell you it's easy and that you can make money while you sleep.
- They tell you that you don't really need to know anything about trading, coding or even crypto!
One of the reasons why I've always steered clear of trading bots is the fact that a large majority of them usually turnout to be scams. I don't know about other exchanges but on Binance, you can actually determine the permissions for your account's API keys. I don't really know if the bots can get around it as Binance was hacked sometime in 2019 and I think it had something to do with users API keys but I'm not 100% sure.
you are just covering the obvious cases of scam bots. there are more sophisticated ones that don't need to rob you to rob you!
for example a while ago there was a bot that was being sold to people with the promise of huge returns and a lot of fake stats. the owner simply made money by fooling people into buying his useless bot while the bot wasn't doing anything malicious, it was just useless because it failed the moment bitcoin price went up (keep in mind this was during the downtrend).
At the end of the day, these bots are just a waste of time. If the bots are even legit, they might run your account to the ground with mediocre trading strategies. It's better to take time to learn trading even though it's time consuming and stressful.