Design an AI market making bot in Coinrule to place maker quotes, manage inventory and respond to volatility on Binance, Kraken, Bybit and OKX.
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Instead of babysitting the order book all day, an AI market making bot on Coinrule can automate maker quotes with clear guardrails. Set rules like: place buy and sell limits 0.20% from mid, refresh every 30 seconds, and pause if spread narrows below 0.05%. Connect to Binance, Kraken, Bybit or OKX via API keys while keeping funds on the exchange.
Traders start by defining where quotes should sit relative to mid price and when to re-quote. The engine watches price, spread and volume, then updates orders when conditions change. You can add filters such as only quote when 1-minute volatility is below 0.8% and the 15-minute trend is flat. Logs show every cancel and replace so you can audit behavior over time.
Every market making setup needs inventory limits, not just tight spreads. Use position caps like max 2% of portfolio per pair, and rebalance back to target when exposure drifts by 0.5%. Add protection rules: if price moves 1.5% in 5 minutes, cancel all quotes and wait 10 minutes before resuming. Combine these with take-profit ladders to reduce inventory into strength.
Order Book Spread Capture
Templates help you start with maker-only orders, then layer in re-quote timing and spread bands. For example, quote 0.15% wide in calm markets, widen to 0.35% when ATR(14) on 1-hour candles rises above a threshold, and stop quoting if slippage exceeds 0.10%. This keeps the system focused on liquidity provision rather than chasing.
Non-Custodial Automation
Coinrule runs your rules while you keep control: CEX connections use exchange API keys, and on-chain automation can use smart accounts with limited permissions. You can pause, clone or schedule strategies, and keep a single view of exposure across venues. For deeper automation concepts, see /automated-trading.
Market Maker Spread Capture
Places maker buy and sell limits around mid price. Re-quotes when price moves beyond a set band. Pauses during volatility spikes to reduce adverse selection.
Order Book Imbalance Fade
Fades short-term order book imbalance by quoting heavier on the thin side. Cancels quotes if imbalance flips within 60 seconds. Uses inventory drift limits.
Time-of-Day Liquidity Sniper
Quotes more aggressively during high-liquidity windows and widens spreads off-hours. Refreshes orders every 20-45 seconds. Disables when volume drops below a threshold.
Dynamic Grid with ATR Spacing
Builds a maker grid with spacing based on ATR. Adds levels when volatility expands and removes levels when it contracts. Enforces a max position cap per side.
VWAP Reversion Scalper
Quotes near VWAP and leans inventory toward mean reversion. Enters when price deviates 0.6% from VWAP on 15-minute candles. Exits as price returns to VWAP.
Market Maker Spread Capture
Places maker buy and sell limits around mid price. Re-quotes when price moves beyond a set band. Pauses during volatility spikes to reduce adverse selection.
Order Book Imbalance Fade
Fades short-term order book imbalance by quoting heavier on the thin side. Cancels quotes if imbalance flips within 60 seconds. Uses inventory drift limits.
Time-of-Day Liquidity Sniper
Quotes more aggressively during high-liquidity windows and widens spreads off-hours. Refreshes orders every 20-45 seconds. Disables when volume drops below a threshold.
Dynamic Grid with ATR Spacing
Builds a maker grid with spacing based on ATR. Adds levels when volatility expands and removes levels when it contracts. Enforces a max position cap per side.
VWAP Reversion Scalper
Quotes near VWAP and leans inventory toward mean reversion. Enters when price deviates 0.6% from VWAP on 15-minute candles. Exits as price returns to VWAP.
Bollinger Band Mean Reversion
Adds maker bids near the lower band and offers near the upper band. Uses 20-period bands on 1-hour candles. Stops quoting if bands widen sharply.
Stop Loss and Trailing Take Profit
Adds a hard stop to market making inventory and trails profit on favorable moves. Tightens the trail after 8% unrealized gain. Cancels quotes on stop trigger.
Range Bound Reversal
Quotes inside a defined range and fades touches of support and resistance. Confirms range with low ADX. Exits if a breakout holds for two candles.
Liquidity Sweep Breakout
Detects fast sweeps and switches from quoting to protective mode. Cancels maker orders when a sweep exceeds a set size. Re-enters after a cooldown and spread recovery.
Laddered Limit Maker
Places a ladder of maker orders with fixed size per level. Rebalances inventory back to target every hour. Uses a max drawdown rule to halt activity.
Unlike black-box systems, Coinrule lets you combine AI-style signals with explicit rules you can test and adjust. An AI market making bot can use adaptive inputs like volatility regime, spread percentile and recent fill rate, then apply deterministic actions. Try a concrete setup: if spread percentile is above 70 and 5-minute volatility is below 0.6%, quote 0.18% wide; otherwise widen to 0.40% or pause. You keep the final say over sizing, caps and shutdown conditions.
On this platform you can run the same strategy across multiple venues without duplicating work. Connect Binance, Coinbase, KuCoin and Hyperliquid, then standardize risk limits per account. Use per-exchange toggles to disable a venue during maintenance or unusual fees. Centralized reporting helps you compare fill rates and inventory drift across markets.
When you change quoting logic, roll it out like software. Start in paper mode, then go live with small size such as 0.25% of balance per side and a max position of 1%. Add a rule that stops all bots if daily PnL drops below -1.2% or if three consecutive re-quotes fail to fill. Once stable, scale gradually and keep a changelog of parameter updates.
For decentralized execution, you can automate trades through smart accounts while keeping self-custody. Session keys can restrict permissions to specific tokens, sizes and time windows. Routing can seek best pools to reduce price impact when rebalancing inventory. This approach is useful when you want automation without handing over private keys.
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Fees decide whether spread capture works. Track maker fees per venue, and account for occasional taker fills when you rebalance. A simple rule is to require expected spread capture to exceed fees by at least 2x before quoting aggressively. If fees rise or rebates disappear, widen spreads or reduce refresh frequency to avoid churn.
When price accelerates, passive quotes can get picked off. Use volatility gates like: if 1-minute range exceeds 0.4%, cancel quotes and wait for two calm candles. Add trend filters such as a moving average slope check to avoid leaning against strong momentum. These constraints often matter more than extra indicators.
Set alerts for unusual behavior: fill rate drops below 10% for 30 minutes, inventory exceeds target by 0.7%, or spread compresses under your minimum. Review daily summaries rather than staring at charts. Consistent monitoring beats constant tinkering.
Start with one liquid pair, then expand carefully. Keep separate caps per asset and a global exposure limit across all bots. Rebalance periodically so one runaway position does not dominate the account. Portfolio-level thinking turns a set of rules into a system.
Coinrule combines visual strategy design, multi-exchange execution and non-custodial control. You can prototype quickly, then harden rules with timeouts, caps and emergency stops. Templates speed up iteration while logs keep you accountable. For more on building rules, see /trading-bots.
Pick a market, define a spread band, set a refresh timer and add a volatility pause. Then run with small size and review fills for a day before adjusting. The fastest progress comes from simple rules you can measure and refine.
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