Backtesting compliance refers to the process of evaluating a trading strategy by applying it to historical data to see how it would have performed in the past.

This is vital for assessing the reliability and effectiveness of a trading approach before using it in real-time markets. In cryptocurrency trading, backtesting allows traders to analyze various strategies, such as trend following or arbitrage, against past market conditions.

By simulating trades using historical prices and volumes, traders can identify potential strengths and weaknesses of their strategies. Compliance involves ensuring that backtesting is done correctly.

This includes using accurate data and adhering to specific rules and metrics to avoid bias. Proper compliance helps to ensure that the results are realistic and can provide valuable insights for future trading decisions. Ultimately, backtesting compliance helps traders build confidence in their strategies, minimize risks, and enhance their overall trading performance.