What is arbitrage trading?

What is arbitrage?

Identifying cryptocurrency arbitrage opportunities

PointPay: ETH-USDT
Binance: ETH-BTC

Why are the prices of cryptocurrencies different?

Centralized exchanges

Decentralized exchanges

Types of crypto arbitrage strategies

Simple arbitrage

  • The selling price of Bitcoins on exchange A is $56,900.
  • The buying price of Bitcoins on exchange B is $57,100.

Triangular arbitrage

  • The ETH / TRX price can come from exchange A.
  • The ETH / USDT price can come from exchange B.
  • The TRX / USDT price can come from exchange A as well.

Why is crypto arbitrage considered a low-risk strategy?

  • The risk associated with cryptocurrency arbitrage trading is somewhat lower than other trading strategies, as it usually does not require predictive analysis.
  • Arbitrage traders need to make trades that do not last more than minutes, so the trading risk is much lower.

Risks of crypto-arbitrage trading

Fees

The timing

Final Thoughts

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
PointPay

PointPay

Cryptocurrency Ecosystem: pointpay.io Crypto Bank, Exchange, Wallet, Payment System. Buy Bitcoin → https://payments.pointpay.io/ Earn up to 30% yearly with PXP.