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Crypto Crash: Make Money With These Bots RIGHT NOW - YouTube
Channel: Max Maher
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fake wind prices down quite a bit
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market's been rough lately now searching
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for the safest ways to earn passive
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income in crypto even if token prices
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are falling faster than bambi on ice and
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i found it a strategy that doesn't care
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if bitcoin is up 50 or down 20 this is
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spot futures arbitrage bots and don't
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worry if that sounds intimidating within
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the next couple of minutes i guarantee
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you'll have an aha moment and until then
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just think of these bots as automated
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fee collectors that don't give a rats if
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the market is up or what elon is
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tweeting first let's set up some bots so
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i can show you my profits later in the
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video i'm using pinex to do all this
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which is linked in the description below
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on pinex i'm gonna click earn and then
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moderate mode because this is the safest
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mode to use these bots i'm gonna put two
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thousand dollars into this spot click
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create and we're good to go then i'm
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gonna test out a few in aggressive mode
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going with bitcoin first two thousand
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dollars into the bitcoin bot and i'm
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going to leave that on 2x leverage click
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create and wait for that to set up now
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this can take a while to set up
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especially for smaller coins and i'm
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also going to set up three additional
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aggressive bots to add a little bit of
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spice to this experiment we're going to
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go with avax vet and doge the total
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amount invested is just shy of ten
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thousand dollars and believe it or not
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these bots can make up to 50 apr with
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very little risk but that begs the
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question how does it work what are spot
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futures arbitrage bots and why couldn't
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they come up with a more catchy name
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let's break this down piece by piece
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first arbitrage arbitrage is the
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practice of buying and selling the same
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asset in different markets for a profit
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a fascinating example is sam bankman
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free the 29 year old worth 22 billion
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dollars he made a huge chunk of money in
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crypto early through crypto arbitrage he
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noticed that due to demand for bitcoin
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in korea prices of a single bitcoin
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could trade for as much as 50 percent
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higher than u.s prices this meant he
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could buy a bitcoin for ten thousand
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dollars in the us and offload it for
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fifteen thousand dollars in korea but
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this had issues regulations were tight
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and it was hard to offload a ton of
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money so he eventually moved over to
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japan
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japan had a lower premium at only 15 but
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he could move much more money this
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resulted in him making quote literally
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10
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per weekday which is absolutely insane
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so in summary arbitrage is profiting off
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of price differences of the same asset
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but the whole title is spot futures
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arbitrage bots so what are spot futures
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arbitrage bots in this context in this
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case it refers to the markets you are
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invested in through this bot when
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investing in one of these bots you are
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actually buying two different assets a
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spot position and a futures position the
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spot position is no different than a
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regular old buy if you flat-out bought
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100 in bitcoin this would be a spot
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position also referred to as a long
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position a futures position on the other
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hand is a bet on the future price of an
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asset a futures position can be long or
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short a long futures position is similar
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to a spot position in that you're
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betting that prices will go up in the
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future a short position is a bet that
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prices will go down you make money if
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the price decreases on a short position
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a purchase into one of these bots splits
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the buy between spot and short in the
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market and this has a fascinating result
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it's very hard to lose money when you do
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this so let's say you invested one
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thousand dollars into one of these bots
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five hundred dollars would be similar to
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a regular buy a bet that prices will go
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up five hundred dollars would be short
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i'll bet that prices will go down the
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result is your investment dollar amount
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never changes much because if prices go
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up your long position makes money if
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they go down your short position makes
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money meaning your one thousand dollars
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stays right around one thousand dollars
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now you're probably wondering how is it
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possible to make any money if you're
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betting with and against the market at
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the same time it sounds like something a
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crazy person would do but this is where
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arbitrage comes in so let's piece this
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together spot futures arbitrage bot we
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know spot in futures are the types of
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buys that we're making betting for and
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against the market at the same time we
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know arbitrage is profiting off of price
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mismatches and bot of course just means
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a program that does everything for us so
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we don't have to sit at the computer and
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monitor things all day like some kind of
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hermit so what is the arbitrage where
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does the profit actually come from well
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this is from something called the
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funding fee also referred to as the
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funding rate this is a fee paid to
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holders to help ensure market prices are
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exactly where they should be the thing
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is traditionally in futures markets
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there's an expiration date meaning you
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could buy a futures position betting on
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the future price of an asset but that
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position would eventually expire usually
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this is done quarterly or monthly the
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reason for this is prices can get way
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off track regular buy and sell pressures
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in the market can make the spot price
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and the future price of an asset vastly
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different over time an expiration date
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essentially creates a reset button so
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prices are set back on track but this
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comes with an issue investors have to
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constantly re-up their contracts if they
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want to stay in those positions and
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that's why perpetual contracts were
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created futures contracts that never
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expire but because they never expire
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there needed to be a way to keep prices
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between the regular market and the
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futures market in line they need to be
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right around the same price it's easiest
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to think of this like a balancing scale
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you have long positions on one side and
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short on the other whenever prices
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decrease too far on one side a funding
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fee is kind of sprinkled on top to
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incentivize investors to move over to
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that side and this funding fee can be
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quite high it can get as high as one
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percent daily in large bull runs here's
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an example of a funding fee at point
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four percent every eight hours meaning
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if you had ten thousand dollars invested
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you would make 120 dollars per day
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nearly risk-free and that's because the
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beauty of these bots is you are market
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neutral you don't make or lose money no
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matter where the market heads but you
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still earn that funding fee now one
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percent daily isn't normal but it's
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fairly common to make 15 and up to 50
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apr urgent intermission so my bots have
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been running for about a week now and i
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ran into an issue the crypto markets
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have absolutely been crashing with major
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cryptos down 30 to 50 percent and this
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has thrown a wrench into my plan now i
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think it's important to be transparent
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and show how much i've actually made so
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far here are the bots the good news is
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all of them are positive except for one
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doge with doge i'm down less than a
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dollar though so in the last week i only
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profited four dollars in six cents on
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nine thousand seven hundred six dollars
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that comes out to about a two point two
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percent apr which of course isn't ideal
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now i'm not mad about that because in
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the last week if i just held those five
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cryptos outright i would have lost over
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seventeen hundred dollars so making four
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dollars i'll take that any day over
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losing 1700 but this highlights the need
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for a new strategy and this begs the
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question why did this happen i thought
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that these bots were market agnostic let
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me explain so remember the balancing
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scale between regular sellers and short
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sellers right now because cryptos are
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crashing this has led far more investors
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to sell short betting that the market
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will go down further tipping the scales
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and decreasing the funding fee
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temporarily looking back at my bots you
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can see that the funding fee is actually
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negative right now and this is pretty
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rare according to pioneex's
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documentation this only happens about 10
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percent of the time now it's not the end
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of the world because i still make money
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if the fee is slightly negative but
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unfortunately sentiment dramatically
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impacts funding rates here we can see a
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piece of research from finance that
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shows funding rates increase and
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decrease with the price of bitcoin which
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makes total sense if you think about it
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because funding rates are a market
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equalizer they are needed most when
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there's a ton of demand on one side to
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go ahead and equal out those balancing
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scales because of this i'm going to stop
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my aggressive bots and i'm going to
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place all of that money into the
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moderate bot the reason being that rates
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are actually higher in the moderate bot
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right now it's also important to note
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that the funding rates that you see are
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paid out every eight hours now from here
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i'm going to report back on the profits
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with this entirely new strategy now spot
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trade arbitrage bots are very low risk
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compared to most things in crypto but
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that doesn't mean there is zero risk
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with the moderate bot especially there
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is about as close to zero risk as you
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can get the only thing i can think of is
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some kind of api issue or bug in code
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that could cause some problems however
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this has a very very low probability
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with aggressive bots there's slightly
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more risk because you're taking on
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leverage this means there's a small
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chance of being liquidated if the price
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of your crypto for some black swan
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reason dropped extremely quickly and
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then the bot failed to rebalance the
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position what i like about pinex though
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is they have an insurance fund in case
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of rare events pinex charges 10 of
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profits for running these bots but half
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of that goes to their safu fund
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basically this fund is there in case a
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cataclysmic event happens the results of
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the experiment are in after the first
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day i was already on a better track
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profiting two and a half dollars day one
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which of course doesn't sound
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groundbreaking but that's like a nine
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percent annualized return more than
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something like the s p 500 with next to
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zero volatility risk from there the
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market downtrended a bit more and rates
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slightly decreased after 10 days the
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total profit came up to 15 or about 5.5
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percent annualized return again i can't
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be mad because crypto in that time
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dropped faster than like a fat kid down
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a water slide and so i'm excited that i
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made money when the market was down and
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i'm even more excited that when the
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market goes back upwards i will make far
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more than five percent apy that's
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because a friend of mine who put me onto
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these bots averaged 27 apy over 400 days
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on this type of bot so that means during
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a bear market it might take as much as
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six hundred thousand dollars to profit
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100 a day but averaged over time at 27
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apy it would take more like 135 000
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invested of course this can be scaled
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down to any investment size in order to
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make one dollar profit per day you'd
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only need 1 350 invested according to
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these numbers so again i'll have these
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bots linked in the description below
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from here if you're interested in other
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crypto passive income ideas check out
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this video on screen and i would like to
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thank you so much for watching and i
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hope you have a profitable day
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