Aug 3, 2025

3 Types of Cryptocurrency Bots – Which One Really Works and Delivers Profits?

Discover the 3 main types of cryptocurrency trading bots: from risky and non-transparent ones to backtesting-based bots. Find out which type really works and generates long-term profits.

Introduction – What Are Cryptocurrency Bots?

Automated cryptocurrency trading bots are becoming increasingly popular. They promise quick profits, passive income, and investing on "autopilot."
Unfortunately, not all bots are built transparently or reliably.

There are three main types of cryptocurrency bots on the market. They differ in their approach to strategy testing, transparency of results, and the level of risk for the investor.

In this article, we’ll explore these three types, reveal their risks, and answer the question – which crypto bot has real potential for long-term success?

1. Blind Bots – Trading Without Any Performance History

No Track Record

These are the simplest yet riskiest bots. They start trading live immediately, without being tested on historical data.
Profits they generate often come only from a favorable bull market rather than the bot’s actual algorithmic quality.

Why Investors Lose With These Bots

No historical results or transparency.
In a bear market, all earlier profits can vanish within weeks.
Often amateur projects in Python, sometimes with “AI” slapped on top, but without proper validation or testing.

Investing in such bots is essentially gambling in the dark.

2. Bots That Only Show Profits – Hidden Investor Losses

Manipulated Statistics

This type of bot looks much more professional, showcasing charts and profitable trade histories. The problem is that losing positions are hidden.
They often avoid using stop losses, meaning trades can remain open at -30%, -50%, or even -90%.

What Happens to the User’s Capital

Open losing positions remain stuck for months or even years.
The investor’s capital becomes locked and unusable.
Reported statistics look good only because they display closed profitable trades, while losses are passed onto the user.

In reality, this is a business model based on user churn – new investors see promising results, join in, and recommend the bot further. Only later do they realize their capital is trapped in losing positions.

3. Bots Based on Backtesting – The Honest Approach

What Is Backtesting and Why Does It Matter?

Backtesting is the process of testing trading algorithms on historical market data. This makes it possible to check how a bot performs during bull markets, bear markets, and sideways trends.

Benefits for the Investor

Transparency – investors can see results month by month.
No frozen losses – losing trades are closed, freeing up capital.
Realistic simulation – trade entries and exits in backtests match what the bot does on the real market.

This way, the investor gets reliable data and can make informed investment decisions.

Bots built on backtesting are the ones with the highest chance of delivering sustainable, long-term profits.

Conclusion – Which Cryptocurrency Bot Should You Choose?

On the market, you’ll find three main types of cryptocurrency bots:

Blind bots – no history, extremely risky.
Profit-only bots – appealing at first glance but hiding massive losses.
Backtesting-based bots – transparent, reliable, and based on real data.

👉 If you want safer, long-term results, only choose bots that rely on backtesting and transparent performance analysis.

👉 If you’re looking for a transparent backtesting-based solution that reflects real performance – check out Intralogic Backtesting Bot.