Introduction to DCA Trading on Bybit EU

Bybit EU’s DCA bots allow you to automatically execute recurring purchases of selected crypto-assets based on user-predefined investment amounts and schedules. While automated purchasing allows users to execute a dollar-cost-averaging strategy over time, it does not eliminate market risk, protect against capital loss, or replace active personal risk management. The DCA bots are based on the Dollar-Cost-Averaging strategy, which involves investing a predetermined amount at regular intervals.

Dollar-Cost Averaging (DCA) bots automate the recurring purchase of crypto-assets. This feature may be a practical tool for users who:​

1. Plan to hold crypto-assets over a longer timeframe,
2. Aim to distribute their purchases to navigate short-term price volatility,
3. Prefer an automated purchasing schedule rather than actively monitoring the market.

How does the Bybit EU DCA bot work?

Bybit EU allows you to create a DCA bot with one coin or a portfolio of up to five coins. Let's see how the DCA bot works by using an example.

Before learning more about DCA trading, let's briefly understand some parameters of the DCA bot order page to make it easier for you to understand the following example.

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How to Get Started with DCA Trading on Bybit EU

Example 1

Suppose Trader A sets up a DCA bot with the following parameters:

1. Currency: USDC
2. Select Cryptocurrencies: BTC and ETH
3. Investment Frequency: 1 week
4. Total Fixed Investment Amount: 1,000 USDC
5. BTC Fixed Investment Amount: 600 USDC
6. ETH Fixed Investment Amount: 400 USDC
7. Max. investment amount for DCA bot (Optional): 5,500 USDC

Assuming that Trader A invests for five weeks, according to the weekly investment frequency, Trader A automatically performs a total of five transactions. The specific details are as follows:

Accumulated Quantity for BTC

Accumulated Quantity for ETH

Please note that the system will automatically transfer the required amount of funds from your Bybit Funding account to the Trading Bot before each purchase. If Rewards Service is enabled, the system will check your DCA bot asset for eligible assets and automatically subscribe them to Flexible Term Rewards Service for yield generation.

During a five-week investment period, the average entry prices for both BTC and ETH can be calculated using the following formula:

Formula

Avg. Entry Price = Accumulated Purchased Value in Quote Token ÷ Accumulated Purchased Amount of Base Token

BTC Avg. Entry Price (USDC) = (600 × 5) ÷ 0.10645868

= 28,179.95 USDC

ETH Avg. Entry Price (USDC) = (400 × 5) ÷ 1.41245423

= 1,415.98 USDC

In this case, Trader A buys 0.10645868 BTC at an average price of 28,179.95 USDC, and simultaneously buys 1.41245423 ETH at an average price of 1,415.98 USDC.

Example 2

If Trader A does not invest in batches through the DCA bot and instead buys BTC and ETH in one go with 5,000 USDC in the first week, the entry price and purchase quantity are as follows:

1. BTC Fixed Investment Amount: 3,000 USDC
2. ETH Fixed Investment Amount: 2,000 USDC

In this illustrative scenario, the DCA bot results in a higher accumulated quantity of BTC and ETH than the one-time purchase. This outcome depends on the assumed price movements and will not necessarily occur in actual market conditions.

In the above example, Trader A has set a max. investment amount of 5,500 USDC. Since the remaining 500 USDC isn’t enough to initiate the sixth auto-purchase — that is, each single investment is 1,000 USDC — the DCA bot will automatically close after the fifth auto-purchase. At the same time, 0.10645868 BTC and 1.41245423 ETH in Trader A’s DCA Bot will be returned to his Funding Account.

Reward Service

Bybit DCA bots now support automatic yield generation through Rewards Service. When enabled, the eligible coins purchased in each DCA cycle will automatically be subscribed to Flexible Term Rewards Service to earn yield.

Rewards Service is a Bybit Earn product and is not regulated under MiCAR. Product availability is subject to jurisdictional restrictions.

Key Features:

1. Default state: Disabled — you can turn it on manually during bot creation
2. Eligible assets: Coins held in your DCA will be automatically checked daily for yield opportunities
3. Minimum investment requirement: Each coin has a minimum subscription amount (e.g., 0.01 BTC). If your holdings don't meet the minimum, no yield is generated for that coin
4. Earnings display: View your daily earnings breakdown on the bot detail page, including: Coin, Date/Time, and Daily Net Value Added
5. T+1 settlement: After closing, accrued yield for the current day is settled on T+1 and automatically credited to your Funding Account

Notes:

— If you do not set a Maximum Investment Amount and the available balance in your Funding Account is not enough for the next auto-purchase, you will receive an email and notification to remind you to deposit funds into your Funding Account. If you fail to deposit sufficient funds in time for the next auto-purchase, the DCA bot will be suspended. Once there are sufficient funds in the Funding Account, it will be activated again at the next auto-purchase time.

— The suspension of DCA bot due to insufficient funds will not automatically terminate it. If you want to terminate your DCA bot, please close it manually.

— By enabling Rewards Service, you agree to transfer full legal and beneficial ownership of the relevant crypto-assets to Bybit EU GmbH for the duration of the subscription. The crypto-assets are therefore no longer held in custody for you, and you retain a contractual claim in accordance with the Agreement for Rewards Services.

Disclaimers

1. Please note that the examples above are purely illustrative. Market conditions vary, and during sustained upward market trends, a DCA strategy may result in acquiring fewer total assets than a one-time purchase. Past or hypothetical scenarios do not guarantee future performance.
2. Bybit Earn is not a regulated product under Regulation (EU) 2023/1114 (“MiCAR”). By subscribing, you transfer full legal and beneficial ownership of the crypto-assets to Bybit EU GmbH. While subscribed, your assets are no longer held in custody for you and may be used by Bybit EU for its own account. You retain only a contractual claim, without ownership or security rights, and MiCAR client asset protections do not apply.
3. Investing in crypto-assets is associated with risks, including high volatility and the potential loss of capital. Inform yourself thoroughly about the risks before making an investment decision. The information provided in this article is strictly for educational and informational purposes and should not be construed as financial or investment advice. This content constitutes a marketing communication within the meaning of the Markets in Crypto-Assets Regulation (MiCAR) and is provided by Bybit EU GmbH.