An experienced and successful bidder can become a lead trader and increase their profitability by sharing their own strategies with other users of a digital exchange. Lead trading is a new approach to making money on cryptocurrency exchanges, where experienced figures share their knowledge and strategies with novice market participants. Unlike independent trading, lead-trader subscribers get the opportunity to copy successful trades of professionals without wasting time on deep analysis of the segment. This is beneficial both for beginners, who earn with minimal effort, and for the leaders themselves, whose profits grow in proportion to the success of their subscribers.
Copytrading, which originated in traditional financial markets in the mid-2000s against the backdrop of technological development, has gained popularity in the cryptocurrency industry. As practice has shown, the more volatile and liquid the assets, the higher the efficiency of copytrading. Back in 2012, scientists from the Massachusetts Institute of Technology under the leadership of Yaniv Altshuller found out that traders copying transactions of more experienced colleagues, received income 6-10% higher than those who traded independently.
Copytrading became a sought-after tool on crypto exchanges, as it allowed beginners to earn as much as professionals, even if the former did not have sufficient knowledge in trading.
Why become a lead trader
Being a lead trader has several advantages. Here they are:
- Additional profit A lead gets a share of the subscribers’ income. Thus, the trader gets an additional source of profit. The amount of fees is set by the lead trader himself, but usually has a certain limit prescribed by the exchange. For example, on OKX the standard limit of lead trader’s commission is up to 13% of subscribers’ profit.
- Reduced commission costs. Another significant bonus that lead traders receive is discounts on trading commissions. Fees are sometimes waived.
- Participation in tournaments with prizes. This is necessary to motivate lead traders. Exchanges often hold competitions, giving out valuable rewards. For example, OKX cryptocurrency exchange is currently running a competition for lead traders with a prize pool of 50,000 USDT.
- Additional bonuses when participating in promotions. Crypto exchanges are interested in supporting lead traders, as they involve new users in active trading and thus increase the trading volume on the platform. For example, OKX provides payments from subscribers’ income and bonuses up to 2000 USDT for those who join the “Club of pros”.
On which crypto exchange can you become a lead trader?
Copytrading service is now available on many popular centralized crypto exchanges such as OKX, Binance, Bybit and others. When choosing a platform, you should evaluate its reputation among traders and popularity among copytrading participants. This will help you find a reliable and in-demand exchange to work with.
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ByBit предоставляет удобные и безопасные условия для торговли криптовалютами, предлагает низкие комиссии, высокий уровень ликвидности и современные инструменты для анализа рынка. Поддерживает спотовую торговлю и торговлю с плечом, а также помогает новичкам и профессиональным трейдерам с помощью интуитивного интерфейса и обучающих материалов.
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Крупнейшая криптобиржа, где можно быстро и безопасно начать путь в мире криптовалют. Платформа предлагает сотни популярных активов, низкие комиссии и продвинутые инструменты для торговли и инвестиций. Простая регистрация, высокая скорость операций и надежная защита средств делают Binance отличным выбором для трейдеров любого уровня!
It is also worth considering the additional features that platforms offer for copy traders. For example, OKX has an intelligent synchronization function available. It automatically adjusts the distribution of assets in accordance with the lead trader’s actions. If a lead trader uses 10% of his deposit to open a position, the same share will be applied to the trader who copies his trades, ensuring an exact match of strategy.
How to become a lead trader
To become a lead trader, you need to go through several steps. Here are the main steps:
- Pass verification. First, you will need to confirm your identity by providing snapshots of the necessary documents. This is a standard procedure on many exchanges, ensuring security.
- Fill out information about yourself. It is necessary to place links to your own pages in social networks to confirm your activity and reputation. This helps subscribers to better recognize the user as a trader.
- Choose the type of trading. The user should decide which trades will be available for copying: futures, spot trading or trading with bots.
- Check the status of the trading account. It must be active, with a non-zero balance, as well as have a history of transactions so that the exchange staff can evaluate the efficiency.
- Wait for the application to be considered. Exchange staff will analyze trading activity and strategy, which may take several days. Special attention is paid to the success of transactions and professionalism.
Only those traders who have demonstrated stable results and long experience on the platform will receive the status of lead trader.
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Author: Saifedean Ammous, an expert in cryptocurrency economics.
