What is a grid trading bot?

A grid trading bot divides a selected price range into levels and places buy and sell orders across them. It aims to capture differences from completed trading cycles as price moves between levels. It cannot ensure that price stays inside the range.

Example: a 90–110 USDT range

Assume a hypothetical token has grid levels at 90, 95, 100, 105 and 110 USDT. Buying one token at 95 and selling it at 100 produces a 5 USDT gross difference. With an assumed 0.1% fee on each fill, commission is 0.095 + 0.100 = 0.195 USDT, leaving 4.805 USDT before slippage.

Why grid profit differs from total profit

Other tokens held by the bot can lose value. If completed cycles earn 5 USDT while the remaining holding falls by 20 USDT, the combined result is −15 USDT before other costs. A move below the range can leave the bot holding a depreciating asset.

Narrower spacing can create more trades while reducing the gross difference per cycle. Our comparison of crypto trading bots considers grid controls beside fees and operational risks.