Crypto Basics

What is Copy Trading and How to Use it for Better Returns?

Explore the power of copy trading for enhanced returns. Uncover the art of replicating successful strategies to optimize your crypto investment journey.
S. Vishwa
9 Minutes
MIN

In the world of cryptocurrency trading, a strategy has been gaining popularity among traders of all experience levels - copy trading. 

By leveraging the expertise of other successful traders, copy trading allows you to replicate their trades automatically and potentially earn profits without having to make trading decisions on your own. 

In this guide, we will delve into the concept of crypto copy trading, how it works, the pros and cons, and how you can develop an effective copy trading strategy.

What is Copy Trading?

Copy trading is a form of investment that allows you to mirror the trades of successful traders. Instead of conducting extensive market research and analysis, copy trading enables you to identify profitable traders on a copy trading platform and automatically replicate their trades in your own trading account. 

This strategy particularly appeals to those new to trading or lacking the time and expertise to make trading decisions. Copy trading lets you choose the traders you want to follow based on their trading style, risk tolerance, and past performance. 

Once you have selected a trader to copy, their trades will be executed in your account in real-time, proportionally to the amount of capital you have allocated to them. This means that if the trader you are copying opens a buying position on Bitcoin, the same trade will be executed in your account.

How Does Crypto Copy Trading Work?

Crypto copy trading is a universal concept that can be applied to various financial markets, including cryptocurrencies. Cryptocurrencies have gained significant popularity in recent years, attracting both experienced traders and newcomers to the market. 

Copy trading in the crypto space allows you to leverage the expertise of successful cryptocurrency traders and potentially profit from their trading strategies.

To start copy trading in the crypto market, you need to open an account with a copy trading provider that offers access to cryptocurrencies. 

Once you have opened an account, you can browse through the available traders on the platform and choose the ones that best match your trading goals and risk appetite.

After selecting the traders you want to copy, the copy trading platform will automatically replicate their trades in your trading account. It's important to note that while copy trading allows you to benefit from the expertise of other traders, it does not guarantee profits.

The success of your copy trading strategy will depend on the performance of the traders you choose to follow and the overall market conditions.

Copy Trading Strategy

Developing an effective copy trading strategy is crucial for maximizing your chances of success in the market. While copy trading eliminates the need for extensive market analysis, it's important to carefully select the traders you want to copy and manage your risk effectively. 

Here are some key points to consider when developing your copy trading strategy:

  • Tradeable Markets: Consider the markets that the traders you are copying focus on. Some traders may specialize in specific cryptocurrencies, while others may have a more diversified approach. Choose traders whose trading style aligns with your preferred markets.
  • Risks: Determine how much capital you will allocate to each trader and how you will manage your overall risk. Many copy trading platforms allow you to set a maximum loss or allocate a specific percentage of your trading account to each trader. Diversification is important to mitigate risks.
  • Market Analysis: Although you are copying the trades of successful traders, it's still important to monitor your copied trades and make adjustments if market conditions change. Stay informed about the market trends and news that may impact the trades you are copying.
  • Leverage: Decide whether you want to copy trades on leverage. While leverage can amplify profits, it also increases the risk. Only invest what you can afford to lose and be aware of the potential risks associated with leveraged trading.

Pros and Cons of Copy Trading

Like any trading strategy, copy trading has its own set of advantages and disadvantages. Here are some of the pros and cons to consider before engaging in copy trading:

Pros:

  • Automated Trading: Copy trading allows you to automate your trading by following successful traders. Once you have selected the traders you want to copy, their trades will be executed in your account automatically, saving you time and effort.
  • Learning Opportunity: Copy trading provides an excellent learning opportunity for traders. By observing their trading decisions and strategies, you can gain valuable insights into the market and improve your trading skills.
  • Diversification: Copy trading allows you to diversify your portfolio by following multiple traders with different trading styles. This can help reduce the overall risk and potentially increase your chances of profiting in various market conditions.

Cons:

  • Dependency on Trader Performance: Your trading results in copy trading are directly tied to the performance of the traders you follow. If a trader makes a bad trade, it will also affect your account. Choosing traders with a proven track record and monitoring their performance regularly is important.
  • Market Risk: Copy trading exposes you to market risks like any other form of trading. Fluctuations in cryptocurrency prices and market conditions can impact the profitability of the trades you copy.
  • Execution Risk: There is a risk of slippage and execution delays in copy trading. If the market moves rapidly, there may be a difference between the price at which a trader opens a trade and the price at which it is executed in your account.

How to Use Copy Trading Strategy?

Using a copy trading strategy is relatively straightforward. Here's a step-by-step guide to getting started with copy trading:

  • Choose a Copy Trading Provider: Open an account with a reputable copy trading provider that offers access to cryptocurrencies.
  • Select Traders to Copy: Browse through the available traders on the platform and choose the ones that align with your trading goals and risk appetite. Consider factors such as their past performance, risk level, and trading style.
  • Allocate Funds: Decide how much capital you want to allocate to each trader you are copying. Diversifying your allocation and not putting all your eggs in one basket is important. Many copy trading platforms allow you to set a maximum loss or allocate a specific percentage of your trading account to each trader.
  • Monitor Performance: Regularly monitor the performance of the traders you are copying. Monitor their trading results, risk management strategies, and overall market conditions. Consider adjusting your copy trading strategy if a trader's performance deteriorates or market conditions change.
  • Adjust Allocation: As you gain more experience and confidence in copy trading, you can adjust your allocation to different traders. You may choose to increase or decrease the amount of capital allocated to a specific trader based on their performance.

Remember that copy trading is not a guaranteed path to profits. It's essential to conduct thorough research, choose traders wisely, and continuously monitor your copy trading strategy to ensure its effectiveness.

How Token Metrics Can Help You?

If you want to invest in crypto passively, you can copy the alpha of other traders. So Token Metrics was an early contributor to an open-source project called Astradao.

With Astradao, an open-source project operating as an index marketplace, investors gain access to a diversified portfolio effortlessly. 

Token Metrics Ventures, a fund with multiple indices on Astradao, encourages investors to explore and copy trade these indices. Furthermore, investors can create and launch their indices, allowing others to invest in the same digital assets.

Is Copy Trading Profitable?

The profitability of copy trading depends on various factors, including the performance of the traders you are copying, market conditions, and your risk management strategies. While copy trading can potentially lead to profits, it is not without risks.

To increase your chances of profitability in copy trading, it's important to:

  • Choose Traders Wisely: Select traders with a proven track record of success and a trading style that aligns with your goals.
  • Diversify Your Portfolio: Allocate your capital to multiple traders with different trading strategies to reduce the overall risk.
  • Monitor Performance: Regularly review the performance of the traders you are copying and make adjustments if necessary.
  • Stay Informed: Stay updated on market trends, news, and events that may impact the trades you are copying.

By following these guidelines and continuously improving your copy trading strategy, you can potentially increase your profitability in the crypto market.

Frequently Asked Questions

Q1. How do I choose traders to copy?‍

When choosing traders to copy, consider factors such as their past performance, risk level, trading style, and market expertise.

Q2. Can I adjust my allocation to traders? 

Yes, you can adjust your allocation to different traders based on their performance and your risk management strategies.

Q3. What should I consider when monitoring trader performance? 

When monitoring trader performance, consider factors such as their trading results, risk management strategies, and overall market conditions.

Q4. Are there any fees involved in copy trading? 

Some copy trading platforms may charge fees for using their services, and you may also need to pay fees to the traders you are copying.

Q5. Can I manually close a copied trade? 

Depending on the copy trading platform, you may have the option to manually close a copied trade if you feel it is necessary.

Q6. Is copy trading suitable for beginners? 

Copy trading can be suitable for beginners as it allows them to leverage the expertise of successful traders without extensive market knowledge.

Q7. Can I copy trade on leverage? 

Some copy trading platforms offer the option to copy trades on leverage, but it's important to understand the risks involved and only invest what you can afford to lose.

Q8. How can I get started with copy trading? 

To get started with copy trading, open an account with a copy trading provider, choose traders to copy, allocate funds, and monitor performance.

Q9. Is copy trading a guaranteed way to make profits? 

Copy trading is not a guaranteed way to make profits. Success in copy trading depends on various factors, including trader performance and market conditions.

Conclusion

Copy trading offers an accessible and potentially profitable way to engage in cryptocurrency trading. By leveraging the expertise of successful traders, you can learn from their strategies and potentially earn profits without extensive market knowledge. 

However, it's essential to understand the risks involved and develop a well-defined copy trading strategy. With proper research, risk management, and continuous monitoring, you can make the most of copy trading in the crypto market.

Remember, copy trading is a strategy that requires continuous monitoring and adjustment. It's important to stay informed, manage your risk effectively, and choose traders wisely to increase your chances of success in the market.

Disclaimer

The information provided on this website does not constitute investment advice, financial advice, trading advice, or any other advice, and you should not treat any of the website's content as such.

Token Metrics does not recommend buying, selling, or holding any cryptocurrency. Conduct your due diligence and consult your financial advisor before making investment decisions.

Build Smarter Crypto Apps &
AI Agents in Minutes, Not Months
Real-time prices, trading signals, and on-chain insights all from one powerful API.
Grab a Free API Key
Token Metrics Team
Token Metrics Team

Recent Posts

Announcements

How to Build On-Chain Crypto Trading Bots Using Token Metrics Crypto API and Chainlink Functions

Token Metrics Team
8 min
MIN

In the evolving world of Web3 development, the need for real-time, reliable, and institutional-grade crypto data has never been greater. Whether you’re building decentralized trading bots, DeFi apps, or smart contract platforms, accessing powerful off-chain data is key to creating intelligent and profitable on-chain systems.

That’s where the Token Metrics Crypto API comes in.

In this guide, we’ll walk you through how to integrate the Token Metrics API with Chainlink Functions, enabling you to deploy live smart contracts that interact with real-time crypto signals, token prices, and trader grades. You’ll learn how to use more than 20 API endpoints and smart contract adapters to power decentralized apps with actionable data.

If you’re searching for the best crypto API for smart contract development, or you need a free crypto API to start testing on testnets, this article is your ultimate resource.

What Is the Token Metrics Crypto API?

The Token Metrics API is an advanced data interface designed for traders, developers, and Web3 builders. It provides access to over 20 endpoints covering everything from:

  • Token prices
  • AI-powered trading signals (bullish/bearish)
  • Trader and Investor Grades (0–100 scoring system)
  • Quant metrics
  • Support and resistance levels
  • Sentiment analysis

Built by a team of quant analysts, machine learning engineers, and crypto-native researchers, the Token Metrics Crypto API brings hedge-fund-grade intelligence into the hands of everyday builders.

Why Use the Token Metrics API with Chainlink Functions?

Chainlink Functions enable smart contracts to securely retrieve off-chain data from any API. By integrating with the Token Metrics Crypto API, you can bridge institutional-grade analytics into fully decentralized apps—something not possible with basic or unreliable data sources.

Here’s why this combo is so powerful:

  • đź”— Chainlink decentralizes your execution
  • đź§  Token Metrics powers your logic with predictive analytics
  • ⚙️ Smart contracts can now act on real market intelligence

This integration enables the creation of intelligent trading bots, dynamic token allocations, and governance proposals backed by hard data—not speculation.

Step-by-Step: How to Integrate Token Metrics API with Chainlink Functions

Let’s walk through how to connect the best crypto API—Token Metrics—with Chainlink Functions to build and deploy a live smart contract.

1. Clone the GitHub Repo

Start by cloning the GitHub repository that contains the full codebase. This includes:

  • A set of ~20 pre-built smart contracts
  • API adapter logic
  • Sample scripts to interact with the contracts
  • A detailed README with setup instructions

Each smart contract is tailored to one Token Metrics API endpoint—meaning you can plug and play any dataset, from prices to sentiment scores.

2. Set Up Your Environment

The README provides a full list of recommended environment variables, including:

  • API_KEY for Token Metrics
  • LINK_TOKEN_ADDRESS
  • CHAINLINK_SUBSCRIPTION_ID
  • ORACLE_ADDRESS

Once your .env is ready, you can start compiling and deploying.

3. Build and Deploy a Sample Trading Bot Smart Contract

In this walkthrough, the developer built a Solidity smart contract that:

  • Pulls live data from Token Metrics (price, signal, grade)
  • Evaluates the signal (e.g., bullish)
  • Executes a buy trade if the signal is positive

The contract is compiled in Remix IDE, connected via MetaMask (on testnet), and deployed using testnet ETH and LINK tokens.

After deployment, you’ll receive a contract address that can be added to your Chainlink subscription.

4. Create a Chainlink Subscription

To fund your contract for data requests:

  1. Go to the Chainlink portal
  2. Create a new subscription (testnet or mainnet)
  3. Fund it with some LINK
  4. Add your deployed smart contract as a consumer

This allows your contract to make external data calls using Chainlink’s decentralized oracle network.

5. Run a Script to Invoke Real-Time Token Metrics Data

Using the provided JavaScript scripts, you can interact with the smart contract and test data flow:

  • Check the bot’s active status
  • Retrieve token price, trading signal, and grade
  • See how the smart contract responds to live market conditions

In the demo, the bot received a bullish signal, saw that the grade was high, and executed a buy trade accordingly. This logic can be expanded into full-scale trading strategies, rebalancing rules, or even on-chain governance triggers.

Why Token Metrics API Is the Best Crypto API for Smart Contracts

Here’s what makes the Token Metrics Crypto API the best crypto API for building advanced, data-driven dApps:

âś… Institutional-Grade Signals

Get access to proprietary AI trading signals, used by hedge funds and institutional desks.

âś… 20+ Endpoints for Every Use Case

Whether you need sentiment data, grades, price trends, or quant models, it’s all there.

âś… Real-Time and Back-Tested

The data is not just live—it’s tested. Token Metrics backtests every signal against market conditions.

âś… Easy to Integrate

Pre-built smart contract adapters make it easy to use the API in Chainlink, Remix, or any EVM-compatible environment.

âś… Free Crypto API Tier Available

Start testing on testnets with a free crypto API key. Upgrade later for full production access.

Real-World Use Cases for Token Metrics + Chainlink Functions

Here are some examples of what you can build using this integration:

  • On-Chain Trading Bots: React to bullish or bearish signals in real time
  • Decentralized Rebalancing Strategies: Adjust token allocations based on trader grades
  • Token Governance: Trigger proposal alerts when sentiment crosses a threshold
  • Risk Management Contracts: Move funds to stablecoins when volatility spikes
  • NFT Floor Price Triggers: Use sentiment and price data for automated mint/pass logic

Final Thoughts: The Future of Crypto Intelligence Is On-Chain

As Web3 matures, the ability to combine decentralized execution with centralized intelligence will define the next generation of dApps. The integration of Token Metrics Crypto API with Chainlink Functions is a major step in that direction.

Developers can now build on-chain applications that make smarter, faster, and more profitable decisions—powered by data that was once out of reach.

Whether you're a DeFi developer, a DAO engineer, or just exploring your first smart contract, this setup gives you a free crypto API to experiment with and the power of the best crypto API when you're ready to scale.

🚀 Ready to Get Started?

  • âś… Get your free Token Metrics API key
  • âś… Clone the GitHub repo and install the smart contracts
  • âś… Join the Token Metrics Dev Telegram community
  • âś… Start building intelligent, AI-powered crypto applications today

Your next-generation crypto trading bot starts here.

Crypto Basics

How Risky Are Moonshot Investments?

Token Metrics Team
8 min
MIN

 Introduction: The High Stakes of Moonshot Crypto

Moonshot investing in crypto is a double-edged sword. On one side, you have tokens that can 10x, 50x, or even 100x your portfolio. On the other side? Complete capital loss. While these asymmetric bets can lead to explosive profits, they also carry extreme risk—especially for uninformed or impulsive investors.

This guide will break down the risk landscape of moonshots: what makes them so volatile, common pitfalls to avoid, risk management strategies, and how tools like Token Metrics help reduce blind spots when betting on the next big thing.

What Makes Moonshot Investments So Risky?

Moonshots live in the outer rim of the crypto market. They are typically:

  • Low market cap (<$20M)
  • Light on liquidity
  • Not listed on major exchanges
  • Lacking product-market fit
  • Speculative or narrative-driven

These factors create an environment where price moves fast—but fundamentals are often thin. You're betting more on potential than proof.

Common Risks in Moonshot Investing

‍

‍

You must assume every moonshot has some of these risk factors — and plan accordingly.

Risk Profile: Moonshots vs. Blue Chips

‍

‍

Moonshots = high variance. Don’t treat them like stable assets.

🛡️ How to Manage Moonshot Risk (and Stay Sane)

  1. Use Proper Position Sizing
    Never allocate more than 1–3% of your total portfolio to a single moonshot.

  2. Diversify Your Moonshots
    Build a “moonshot basket” of 5–10 different bets across categories (AI, DePIN, L1s, Meme, etc).

  3. Set Clear Entry and Exit Plans
    Know your take-profit and stop-loss targets before entering.

  4. Track Vesting & Unlock Schedules
    Use tools like Token Unlocks to avoid buying before big token dumps.

  5. Don’t Fall in Love With Your Bags
    Stay objective. Exit when the narrative fades or fundamentals change.

đź§Ş Risk Evaluation Checklist

If you answer “no” to 2 or more of these, tread cautiously.

How Token Metrics Minimizes Risk Exposure

Token Metrics helps de-risk moonshots by analyzing over 80+ data points using AI and quant models:

  • Risk-adjusted momentum scores
  • Tokenomics evaluations
  • On-chain behavior analysis
  • Contract audit status
  • Community health signals
  • Bullish/Bearish alerts based on AI

You get a comprehensive view of upside and downside before making a decision.

Mental Models for Risky Investing

  • “Play with house money” – Take profits early and only risk profits.
  • “Barbell strategy” – Majority in stable assets, small % in high-risk/high-reward.
  • “Expected Value (EV)” – Even if 8/10 fail, 1 big win covers losses.
  • “Don’t chase losses” – Accept failures quickly and move on.

Moonshot investing is mental warfare. Stick to frameworks, not FOMO.

Final Thoughts: Risk is Inevitable — Manage It, Don’t Fear It

The path to 100x gains in crypto will always be riddled with landmines. But risk isn’t inherently bad — it’s the price of asymmetric upside. The real danger is unmanaged risk, impulsive decisions, and poor research.

With the right approach, the right tools, and a clear head, moonshot investing can be one of the most rewarding strategies in crypto.

Just remember: You only need to be right once.

Crypto Basics

Are Moonshots Only Meme Coins?

Token Metrics Team
8 min
MIN

Introduction: The Meme Coin Myth

When most people think “moonshot” in crypto, they think of meme coins like Dogecoin, Shiba Inu, or Pepe — volatile, viral, and often with no utility. While it’s true that meme coins have historically delivered explosive returns, they’re just one type of moonshot. In reality, some of the best moonshots are deeply technical projects with innovative real-world use cases.

In this blog, we’ll explore why moonshots go far beyond memes, the other types of high-potential assets you should be watching, and how to distinguish hype from substance in your moonshot hunt.

Why Meme Coins Became the Face of Moonshots

Meme coins dominate headlines and retail attention for good reason:

  • Low entry barriers – Often priced at fractions of a cent
  • Viral marketing – Driven by memes, humor, and community hype
  • Explosive gains – SHIB, DOGE, and PEPE all had 1,000x+ runs
  • Community-driven – Holders often act as evangelists

Because of these qualities, meme coins are often perceived as the only moonshots. But perception doesn’t equal reality.

The Reality: Many Moonshots Are Utility-Driven

Some of the most successful moonshot investments didn’t begin as memes — they were innovative, under-the-radar projects that grew into billion-dollar ecosystems:

None of these were memes — they were tech-focused moonshots.

Categories of Non-Meme Moonshots

Here are several non-meme sectors producing moonshot-level gains:

  1. AI Coins – e.g., Fetch.ai, Render, Akash
  2. DePIN (Decentralized Physical Infrastructure) – e.g., Helium, IoTeX
  3. RWAs (Real-World Assets) – e.g., Centrifuge, Goldfinch
  4. L2 & Interoperability – e.g., Starknet, Hyperlane, Axelar
  5. Privacy Coins – e.g., Namada, Secret Network
  6. Early-stage L1s – e.g., SEI, Monad

These projects combine visionary ideas with real-world applicability — and many began as stealth moonshots before going mainstream.

How to Spot Utility-Based Moonshots Early

Look for:

  • Unique narrative fit – Aligns with hot macro themes (AI, DeFi 2.0, Web3 infra)
  • Underexposed – Not yet listed on major CEXs or hyped by influencers
  • Backed by smart money – VC involvement or known crypto angels
  • Product roadmap – Testnet/Mainnet imminent or newly launched
  • Active GitHub or whitepaper – Real builders, not marketers

Meme coins may be powered by emotion — but utility moonshots are powered by execution.

Token Metrics Helps Spot Both Meme & Utility Moonshots

Token Metrics doesn’t just chase hype — it grades thousands of tokens using 80+ data points including:

  • Momentum and price trends
  • Community sentiment and buzz
  • GitHub commits and developer activity
  • Market cap ranking
  • AI-generated bull/bear signals
  • Smart contract risk analysis

This means you can discover both emerging meme coins and tech-driven moonshots based on real metrics — not just Twitter noise.

Can Meme Coins Still Be Valid Moonshots?

Yes — but they should be treated like short-term plays with proper risk management. When timed right (early launch, CEX rumor, meme trend), meme coins can 10x fast. But unlike utility tokens, meme coins often lack long-term sustainability unless they evolve (like DogeX or SHIB ecosystem).

Use tools like Token Metrics AI Signals to time entries and exits.

⚠️ Avoiding the Meme Coin Traps

‍

Don’t confuse “meme” with “momentum.” Use data.

Conclusion: The Smart Moonshot Portfolio is Diversified

If your moonshot portfolio is 100% meme coins, you're gambling. If it’s 100% early L1s with no traction, you may be stuck waiting years. Smart investors build a balanced basket that includes:

  • Memes with momentum
  • Mid-cap undervalued alts
  • Undiscovered AI, RWA, and DePIN gems
  • Fundamental plays with strong tokenomics

Meme coins are just one path to the moon — don’t miss the others.

Choose from Platinum, Gold, and Silver packages
Reach with 25–30% open rates and 0.5–1% CTR
Craft your own custom ad—from banners to tailored copy
Perfect for Crypto Exchanges, SaaS Tools, DeFi, and AI Products