Pure Market Making with Multiple Orders in a Crypto Bounty Program
Article Hummingbot docs
Summary
This interview describes a participant’s use of pure market making in the $ONE Makers liquidity bounty program. The trader reports adjusting order sizes to inventory, generally keeping spreads consistent except around significant news, and using multiple orders to seek more trading activity. They typically used about five orders and found that higher order counts could run into Binance order-frequency limits. The interviewee preferred this approach to cross-exchange market making, which they said produced fewer trades under the market conditions they encountered and offered no assured profit on take orders.
The account offers practitioner observations rather than a tested strategy evaluation. The interviewee estimated results beyond bounty rewards were around break-even or slightly positive and said their own performance tracker better reflected trade results than the platform’s inventory-focused tracker. A tight-spread test on another token pair may have lost money. The examples are specific to one trader, venues, pairs, and period; they do not establish general profitability or quantify execution costs and inventory risk.
Key ideas
- Pure market making was the interviewee’s preferred approach for generating trades in the bounty program.
- Order sizes were adjusted to inventory, while spreads were usually kept consistent unless significant news arose.
- The trader typically placed about five orders and encountered exchange order-frequency limits when trying more.
- The interviewee estimated performance beyond bounty rewards as near break-even, with possible small gains.
- A tight-spread trading example may have incurred losses, underscoring that volume does not ensure profitability.
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Full text
# Interview with Liquidity Miner Dominator008 --- date: 2019-09-03 authors: - coinalpha categories: - User Interviews tags: - User Interviews --- # Interview with Liquidity Miner Dominator008  It's been just over two months since the launch of the $ONE Makers liquidity bounty program. With intense competition, bounty hunters have diligently worked to climb the ranks on our newly launched, real-time leaderboard. The trading volume for $ONE in July and August totaled an impressive **USD $5.98 million**. In this post, we're excited to introduce Dominator008, who clinched the **#1** spot in the August reward period and has earned **over 10 ETH** in the previous period. Dominator008, a software engineer by profession with a deeply technical background, joined $ONE Makers in mid-July. He is currently utilizing hummingbot to trade various pairs, including ONE. *Disclaimer: This interview is not financial advice. The views expressed are solely those of the interviewee and do not represent the opinions of hummingbot.io. Hummingbot does not guarantee or claim to guarantee profits.*  ### How did you first learn about Hummingbot? I discovered hummingbot through Harmony. They were collaborating with hummingbot to enable community members to engage in market making themselves. Harmony chose to involve amateur market makers in addition to professional ones, to test its efficacy in a real-world setting. That's when I started exploring and using hummingbot. ### What has been your experience using Hummingbot? It's been overwhelmingly positive. On a scale of 1-10, I'd rate it a 9. The user interface is excellent, the setup guide is intuitive and well-detailed, and the documentation is comprehensive. Plus, the support team, including founder Mike and his team, is fantastic. They're always ready to assist, and I receive quick responses to my queries. ### Have you been successful in generating profits? Are you referring to profits beyond the liquidity bounties? My performance is around break-even, possibly slightly profitable. The profitability tracker in hummingbot focuses mainly on inventory, not the actual trades. Hence, I've developed my script to monitor real performance. (You can find Dominator008’s performance calculator [here](https://github.com/Dominator008/hummingbot-trades-calculator).) ### What strategies do you employ in the $ONE Makers program? I solely use pure market making. I experimented briefly with the cross-exchange market making strategy, but it wasn't generating many trades due to its reliance on specific market conditions and no guarantee of profit on take orders. I prefer strategies that offer more volume and a higher number of trades to maximize the average profit per trade. ### Did you encounter any issues during setup or configuration? The setup process was quite straightforward. There were a few bugs initially, but the team promptly resolved them, like the ones related to volume tracking and duplicate orders on Binance. Overall, the documentation was clear and comprehensive, making the process hassle-free. ### Do you believe your technical background made the process easier? Certainly, my technical background was advantageous, but the instructions are clear enough that even less technical individuals should find the process manageable. ### How long did it take for you to set up Hummingbot? In total, it took me just a few hours. It was not time-consuming to get everything up and running. ### Are the current strategies user-friendly for beginners? The documentation is excellent, providing clear examples and detailed explanations of strategies. While advanced features like multiple orders could use more documentation, the existing resources, particularly for inventory skew, are detailed and informative. ### Have you tried using multiple orders in pure market making? Yes, I frequently use multiple orders, typically around five. I once attempted ten orders but faced limitations with Binance's order frequency. I find that five orders are a balanced approach, allowing me to break even or even turn a profit with my current settings. ### Have you traded other token pairs with Hummingbot? Indeed, I have. For instance, during the Binance Celer trading competition, I used hummingbot for significant trades. With the BNB-CELR pair, I generated an average trading volume of **10 bitcoins per day**. Although I maintained a very tight spread, which might have led to some losses, it provided a valuable opportunity for testing.  ### Lastly, any trading tips for fellow traders? I recommend experimenting with different settings, as each pair and market condition is unique. Adjustments depend on inventory; I frequently modify order sizes and maintain a consistent spread, unless there's significant news. I stay informed through channels like the Harmony telegram for updates on partnerships and other developments. ------------------------------------------ Earn rewards by [installing hummingbot](https://github.com/hummingbot/hummingbot) and registering for the program. Join the conversation on [Discord](https://discord.gg/85Ms9QUQ). Follow us on [Twitter](https://twitter.com/hummingbot_io). ---
Shown in full with attribution under the source's licence. Licence: Apache-2.0
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.