What is the difference between Hummingbot and a regular trading bot?

Hummingbot specializes in market making and liquidity provision strategies rather than directional trading. It places orders on both sides of the order book to earn the bid-ask spread.

Does Hummingbot work with decentralized exchanges?

Yes. Hummingbot supports DEX connectors including Uniswap, dYdX, and others alongside centralized exchanges like Binance and Kraken.

How much capital do I need to run Hummingbot?

There is no strict minimum, but market making strategies work better with sufficient capital to maintain orders on both sides of the book. Start with amounts you can afford to lose while learning.

Hummingbot | CLI Trader

TL;DR: Hummingbot is an open-source trading bot that specializes in market making and liquidity provision across centralized and decentralized crypto exchanges.

Hummingbot runs as a CLI application (typically via Docker) that connects to crypto exchanges and executes automated market making strategies. The core approach involves placing limit orders on both the buy and sell sides of an order book, earning the bid-ask spread. The bot includes several built-in strategy templates: pure market making, cross-exchange market making, arbitrage, and liquidity mining. Each strategy has configurable parameters for spread, order size, inventory management, and risk limits.

The tool supports a wide range of connectors covering both centralized exchanges (Binance, Kraken, Gate.io, KuCoin) and decentralized exchanges (Uniswap, dYdX, PancakeSwap). This makes it one of the few open-source tools that bridges CeFi and DeFi liquidity provision. Configuration is handled through an interactive CLI setup wizard, and the bot runs persistently with logging and performance reporting.

Hummingbot is designed for traders interested in market making and liquidity provision rather than directional speculation. It requires understanding of order book dynamics, spread management, and inventory risk. The learning curve is moderate, but the documentation and community provide substantial support for new users.