Binance unveils spot copy trading feature in automated strategy tools expansion

Binance, the largest crypto exchange by trading volume, is set to roll out a new spot copy trading tool — enabling users to follow and automatically execute the same trades as some of the platform’s top traders.

“At Binance, we’re always listening to our users and incorporating their feedback into our products. Our users give us great ideas because, very often, they know what works best for them,” Binance CTO Rohit Wad said in a statement shared with The Block. “Spot copy trading is one such idea that came from community feedback. This is a great tool that automates trading for our users, and gives them the ability to try new trading strategies.”

Pioneered by the social trading platform eToro, copy trading allows anyone to leverage the techniques and risk management strategies of experienced traders who can monetize their expertise by opening up their portfolios for replication. It has also been deployed by other major crypto exchanges such as Bybit, OKX and Bitget in recent years.

Binance’s new spot copy trading product is open for registration to “lead traders” who meet its minimum portfolio asset management size requirements from today, with the tool then rolled out to copy trading users gradually in May.

Lead traders’ spot copy trading portfolios must be between 500 USDT and 250,000 USDT, a Binance spokesperson told The Block. Lead traders receive a 10% profit share and a 10% trading commission rebate weekly from copy traders who replicate their trades.

Users can review lead traders' metrics, such as their profit and loss record, copy up to ten lead trader portfolios at a time, and set their own automated risk controls such as stop-losses and copying by a fixed ratio or fixed amount, the spokesperson said. Leverage is not available for spot copy trading, they added.

Users can become both lead and copy traders. The feature will initially be available in selected markets across Latin America, Europe, the Middle East and the Asia Pacific regions. It will begin with over a hundred spot pairs, with more introduced over time, the spokesperson added.

Binance also announced a lead trading tournament will run from April 24 to May 8, enabling lead traders to start building up their portfolios ahead of the products' rollout on the Binance app.

Binance’s expanding automated trading tools

Binance’s spot copy trading feature will add to its existing automated strategy tools, including dollar-cost averaging and a rebalancing bot to automatically adjust crypto portfolios. Binance said such tools can help users better control how they participate in a 24/7 market, removing emotions from decision-making and enabling them to execute trading strategies more efficiently, with greater diversification and risk management.

Binance previously launched a copy trading feature for its futures products in certain regions in October 2023. Lead traders enrolled in the existing futures copy trading product are still required to register for spot copy trading separately, the Binance spokesperson confirmed.

Binance said the spot copy trading feature will offer users greater flexibility in how they manage their trading strategies in markets where both tools are available. In terms of the specific benefits of spot copy trading over futures copy trading, Binance's spokesperson said that for less experienced users, spot copy trading could allow them to experiment and learn about crypto and trading before they decide to move on to other products like futures. They also argued that Binance could offer better liquidity with less slippage for users when executing trades compared to rival copy trading platforms.

The spokesperson could not disclose the percentage of users who have used Binance's existing copy trading feature. However, as spot trading is more widely available to more users, lead traders could potentially access a larger user base of copy traders to engage with, they said.