Wiserr
Active member
Things to look out for when crypto arbitrage trading
TRANSANCTION FEE
Another factor you should keep in mind is potential transaction fees. You don't want the overhead costs for executing trades and transfers to eat too much into your profits. To migrate the impact of high transaction fees, you can deposit sufficient holdings of crypto assets on multiple exchange at once. Then, whenever you want to seize on a crypto arbitrage opportunity, you can reshuffle your portfolio in such a way that allows you to capitalize on the opportunity.
For example, an arbitrage can hold 1BTC On coin base and $53,000 worth of USDT on binance.when the price of bitcoin is $53,000 on binance and $53,200 on coin base,the logical trader could sell their bitcoin on coinbase for USDT and buy 1BTC on binance with their USDT holdings. This would allow the trader to pocket $200 difference as a profit
In this way,the trader has bypassed any deposit and withdrawal fees,as well as saving the next time it takes for the process
INTEREXCHANGE
TRANSANCTION. The only thing such a trader needs to worry about are Maker and taker fees,which are however rather low for high volume traders. Note that crypto arbitrageurs almost always have to execute large trades on order to be able to generate significant profits from single arbitrage opportunity.
TRANSANCTION FEE
Another factor you should keep in mind is potential transaction fees. You don't want the overhead costs for executing trades and transfers to eat too much into your profits. To migrate the impact of high transaction fees, you can deposit sufficient holdings of crypto assets on multiple exchange at once. Then, whenever you want to seize on a crypto arbitrage opportunity, you can reshuffle your portfolio in such a way that allows you to capitalize on the opportunity.
For example, an arbitrage can hold 1BTC On coin base and $53,000 worth of USDT on binance.when the price of bitcoin is $53,000 on binance and $53,200 on coin base,the logical trader could sell their bitcoin on coinbase for USDT and buy 1BTC on binance with their USDT holdings. This would allow the trader to pocket $200 difference as a profit
In this way,the trader has bypassed any deposit and withdrawal fees,as well as saving the next time it takes for the process
INTEREXCHANGE
TRANSANCTION. The only thing such a trader needs to worry about are Maker and taker fees,which are however rather low for high volume traders. Note that crypto arbitrageurs almost always have to execute large trades on order to be able to generate significant profits from single arbitrage opportunity.