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The following article is an op-ed by Laurent Benayoun, CEO of Acheron Trading. Algorithmic trading, or “algo trading”, has swiftly established itself within the financial landscape, particularly within the volatile, high-paced crypto market. While often perceived as a domain for high-frequency traders with deep pockets, algo trading is, at its core, about automating trading strategies to create a more systematic, unbiased approach. The crypto market has proven to be an ideal playground for these strategies, given its 24/7 operation, high volatility, and rapid evolution, but misconceptions persist.While many assume algo trading is synonymous with high-frequency trading (HFT), it’s actually a broader category. In fact, algorithmic trading is responsible for approximately 60-70% of overall trading volume in developed markets, with a significant portion of trades automated to replace human inconsistencies with disciplined, data-backed decisions. An algorithm might follow simple rules, such as moving average crossovers or more advanced predictive models, strategies that bring precision and structure to trading decisions in a market that never stops.Despite its strengths, algorithmic trading faces challenges: the biggest being the need to adapt to unpredictable market shifts and rapidly changing technologies. However, its potential is enormous: the global algorithmic trading market size was valued at around $17 billion in 2023 and is expected to reach $65.2 billion by 2032, growing steadily as both retail and institutional players adopt these technologies. This growth demonstrates the potential of algo trading to facilitate faster, more data-informed trades, while democratizing access to trading strategies previously reserved for institutional players. By addressing these challenges and dispelling myths, we see how algo trading is transforming crypto into a more accessible and resilient landscape for all types of traders. Algo Trading Isn’t Just for Big Players One common misconception is that algo trading requires substantial infrastructure and data resources, making it exclusive to…

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Filed under: News - @ December 28, 2024 5:13 pm