
Show HN: Automatically Index the Top 20 Cryptocurrencies by Market Cap - haggenballs
https://www.hodlbot.io
======
iampims

        I still don’t trust HodlBot with my API Keys
    

That’s really a major issue that should be your main focus. Can’t wait to see
the Electron app.

~~~
salimane
you can use
[https://github.com/salimane/cryptodiversify](https://github.com/salimane/cryptodiversify)
today and it is open source

~~~
haggenballs
That's really funny. I went to the github repo and saw my words copied and
pasted from my blog into the description.

I'm not upset though, I think this is actually pretty cool. Good job for
putting this together. I'm happy with people using this if they want to run it
locally.

------
haggenballs
_TLDR: Got sick of manually managing a cryptocurrency index, made an algo bot
that automatically does it for you_

Over the Christmas break I realized I was spending close to 5 hours a month
manually rebalancing my portfolio of ~20 cryptocurrencies weighted by market
cap.

I got sick of that pretty quickly so I decided to make a bot that uses
Binance’s API to automatically handle that. For the memes, it’s called
HodlBot.

A few months later, I’m releasing the hosted version of the bot. Now anyone
can put their trade-only API keys into HodlBot, and it will automatically
trade into the top 20 cryptos. It will also handle monthly rebalancing
automatically.

 _What does the algorithm do?_

The algorithm take the top 20 coins and assign each coin a % allocation based
on their weighted market capitalization.

Then it caps every coin to be at most 10% of the total portfolio value.
Anything above 10% gets redistributed to all the coins below by weighted
market capitalization until the entire sum of the portfolio adds up to 100%.

 _What do I need to get started?_

    
    
       1.Binance Account
    
       2.Binance Trade-only API Keys
    
       3.$200 in cryptocurrencies
    

_How much are Binance transaction fees on rebalancing?_

I simulated monthly rebalancing on a 3 year period, and found that the average
transaction fees were 0.26%.

This can be higher or lower based on how volatile the market is in the future.
The theoretical max is 1.2% (if every coin in the top 20 turned over every
month).

 _How much does it cost?_

For the first month it’s $1. Afterwards it’s $10 per month. No % fees.

 _How can I trust HodlBot with my API keys?_

We encrypt the keys on our end. Also we don't require withdrawal permissions,
just trade-only.

 _I still don’t trust HodlBot with my API Keys_

In the next month we’re releasing a version of the app that never stores API
keys server-side and only executes trades in the browser. After that, we’ll be
releasing an electron app so you can store your API keys on your local
computer.

 _How is this different than projects like Crypto20?_

Users hold their own assets as opposed to a tokenized guarantee of some
underlying assets. Tokenized assets like C20 often times trade above and below
the net asset value of the assets they claim to hold. In my opinion, this adds
a layer of speculation and complexity on top of the index that makes it
marginally worse than holding the assets yourself.

 _How do I report tax on HodlBot trades?_

Export your Binance transactions as a csv. Plug it into a tool like
cointracking.info and get a tax-friendly report.

 _More Info:_

I dig into the portfolio construction and share the algorithm in this blog I
wrote here:

[https://medium.com/@AnthonytXie/hodlbot-cryptocurrency-
inves...](https://medium.com/@AnthonytXie/hodlbot-cryptocurrency-investing-on-
autopilot-dce2e4c9a7f7)

