The cryptocurrency industry, in recent years, has experienced a meteoric rise in the financial world due to its “high risk, high reward” image.
Thanks to the industry-shaking rise and slight fall of Bitcoin and the advent of blockchain technology, cryptocurrency now rivals stocks and mutual funds in terms of investment viability. Just like the innovative technology that it runs on, cryptocurrency is also outfitted with several cutting-edge tools that allow traders to take advantage of the rapidly changing technological landscape. Out of all the different developments in the cryptocurrency industry and crypto technology as a whole, there’s one particular tool that has quickly risen in popularity: Crypto APIs.
Regardless of whether you’ve heard of it through a cryptocurrency news report or an update from a well-known trader, Crypto APIs have gained and maintained their popularity for a variety of reasons. With the cryptocurrency industry itself evolving at a rapid pace, Crypto APIs have been constantly used by experienced crypto traders to stay on top of every update and opportunity that comes out.
What is Crypto APIs?
Short for “application program interface,” APIs are a technology that allows one type of software application to interact with another technology. APIs, in essence, act as a point of compatibility between two previously unliked applications in order to serve a certain purpose.
Through the use of APIs, application developers can easily plug a digital technology in different apps without having to build a new version from the ground up painstakingly.
With regard to the cryptocurrency or crypto-asset market, APIs enable and provide a certain level of access that traders can use to gain information on market data concerning blockchain protocols and exchanges. Crypto APIs, in particular, come in various forms, with the most common being:
- Trade execution: These types of APIs simply enable traders to make exchanges and perform their namesake functions through third-party platforms
- Price APIs: On the other hand, these particular APIs are responsible for providing digital asset exchange offers and on-going rates from one application to another
Additionally, crypto APIs can also come in the form of market data, token sale information, blockchain analytics, and other pertinent cryptocurrency-related functions.
Where are crypto APIs used?
Crypto APIs are commonly used by professional traders, cryptocurrency wallets, data analytics platforms, and hedge funds.
Through the use of crypto APIs, the aforementioned entities perform several functions, such as automated trading strategies, algorithmic trading, real-time pricing, and past performance modeling (through the use of historical prices).
On the other hand, APIs can also be used by cryptocurrency wallets to provide real-time information that each wallet user can use to gauge their current investment performance through accurate values.
While they still may be in their infancy stages, crypto APIs have a bright future ahead and are guaranteed to make even greater contributions to the cryptocurrency industry in the future. Knowing the basics of crypto APIs will also help with figuring out the technology on a more basic level, making it much easier to transition towards greater levels of knowledge and applicational skills.
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