Within today’s financial world, APIs are omnipresent, and yet most people don’t even know when they use one. Trading on API is more used every day on crypto.
Stock trading mainly took place over the phone before the Internet. For example, if you wanted to buy stocks, you had to call your broker and have them trading on your behalf. In the post-Internet age, buying and selling moved online, and technology development has advanced the method in many respects. The development and use of trading on API were one of those ways.
What does API or trading on API means?
API stands for “application programming interface.” An API is a program that allows you to connect with one software application. Simply put, an API is a messenger that takes inputs and asks a system whatever you want it to do. And then returns the answer to you from the system.
Because of their use of algorithmic trading systems, trading APIs are particularly popular among hedge funds and proprietary trading companies. Still, even private investors can use trading APIs offered by online brokerages and more recently by cryptocurrency exchanges.
A key for mass adoption:
The more experienced investors enter the crypto-asset markets, the higher will be the growing use of trading on API and automated trading. For sure, these trading systems, which aim to take benefit of arbitration incentives, would help make the cryptocurrency industry more liquid and successful. Also, it would bring more institutional investors to this new category of assets.
The more developed the ecosystem of crypto-asset trading, the more market entrants can appear. We are currently heading in the direction of becoming part of the established global financial markets for crypto-asset markets. Once crypto regulations are in place in leading economies around the world, more institutional money will come in, and the development of sophisticated and secure trading APIs will play their small but fundamental role in that.