Need 2 Knows

This is a section of the documentation that contains some useful information that might be worth noting.

🧮 Hidden tax benefits

Warning

This is no financial advice. The authors of this software are not tax advisors. The following scenario may not apply universally. Users should conduct their own research.

In many countries, the tax principle of First In, First Out (FIFO) is applied to cryptocurrency trading. The infinity-grid benefits from this, as the first purchased assets are the first to be sold. This means that in sideways or downward-trending markets over the medium to long term, sell orders may liquidate assets bought at higher price levels (from a tax perspective). Consequently, even if actual profits are made by selling at a higher price than the last buy order, no taxes may be due, as the transaction could be considered a loss for tax purposes. This approach can be utilized to accumulate cryptocurrencies in declining markets, such as with the GridHODL strategy, potentially without incurring any tax liabilities.

💡 Further things to know

  • The trading bot allows the use of an in-memory database. Only use this for testing and debugging purposes, since information gets lost after the instance was terminated.

  • Using SQLite as DB for a single instance might be appealing, but can slow down the trading bot and is not as stable as running against a real PostgreSQL instance. Using a PostgreSQL DB backend is the recommended way as it also allows running multiple trading bot instances against the same DB backend.

  • Use different userref’s for different bot instances. The userref is used by the bot to identify which orders belong to him. Using the same usererf for different assets or running multiple bot instances for the same or different asset pairs using the same userref will result in errors.

🐙 Kraken Crypto Asset Exchange

  • Use different API keys for different bot instances, otherwise you will encounter nonce calculation errors.

📋 What happens to partially filled buy orders?

The algorithm manages its orders in lean way, meaning partially filled buy orders that may get cancelled will be remembered. This is done internally by saving the order price and filled amount in order to place a sell order at a higher price in the future.

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