A program that trades instead of a trader in an automated mode. The algorithm could be built-in in the program or set by a trader manually.
Types of trading bots:
• simple trading bots (with preset settings);
• advanced trading bots (with the possibility of customization);
• script bots (open source bots);
• signal bots (they do not trade on their own, just send a buy/sell signal);
• arbitrage bots (work on the price difference between exchanges or trading pairs);
• statistical arbitrage bots (looking for undervalued or overvalued cryptocurrencies).
Read more about trading bots here