Marie Curie PhD on Machine Learning for High Energy Physics, with a background in Theoretical Physics from Oxford

2 minute read

Automated crypto trading can save time, eliminate emotions, and optimize your strategies. In this guide, we’ll walk through setting up a fully functional trading bot using Freqtrade—an open-source crypto trading framework—and deploy it on the AWS cloud.

Getting Started: Building the Bot

To get your bot up and running, you can follow either of these resources:

Deploying on AWS Cloud

Here’s a step-by-step guide to deploy your bot using AWS EC2:

  1. Create an AWS Account
    Head over to AWS and register.

  2. Launch a Debian-Based EC2 Instance
    Choose a lightweight Debian-based Linux AMI and generate a key pair (.pem file).

  3. Connect to the EC2 Instance
    Use your terminal to SSH into your instance: 
    ssh -i "KeyPair.pem" admin@<your-ec2-ip>
  4. Install Freqtrade
    Follow the installation steps from the Freqtrade Installation Guide.

    Tip: Make sure you meet all the system requirements before proceeding.

  5. Activate the Virtual Environment
    Once installed, activate the Python virtual environment: 
    source ./.env/bin/activate
  6. Configure the Bot
    Set up your bot by generating a new config file: 
    freqtrade new-config

    This will create a config.json where you’ll add your exchange and trading parameters.

  7. Connect to a Crypto Exchange
    • Generate your API key and secret from an exchange like Binance or Kraken.
    • Input these into your config.json to enable live trading or paper trading.
  8. Telegram Integration (Optional but Recommended)
    • Create a Telegram bot and get its token.
    • Find your Telegram chat ID.
    • Add both to the config file to monitor and control the bot via Telegram.
  9. Keep the Bot Running After Disconnection
    Use screen to keep the bot running even if you close your terminal: 
    screen

    Start your bot, then detach with:

    Ctrl + A, then D

    To resume:

    screen -r

    More info here: Keep SSH Sessions Alive

Limitations & Considerations

  • No Short Selling: Freqtrade only supports buying/selling spot pairs, not margin or futures.
  • No Market-Neutral Strategies: Since you can’t short or access perpetual contracts, strategies like arbitrage or funding rate exploitation aren’t feasible.
  • Market Risk: Automated doesn’t mean risk-free. Backtest thoroughly before going live.

Final Thoughts

Freqtrade is a powerful tool for algorithmic crypto trading, especially for those with some coding experience. Combined with AWS, it offers a scalable and low-cost setup for your bot — whether you’re just experimenting or looking to automate a production-level strategy.

Have you built your bot already? What strategy are you running? Share in the comments!

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