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Topic: Arbitrage on crypto-currency exchanges: basic schemes! (Read 113 times)

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legendary
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Where is my ring of blades...
Arbitrage on crypto-currency exchanges: basic schemes!
May 09, 2018, 06:13:16 AM
#2
arbitrage is always working in theory but when it comes to practice it fails. foe example in the example you included here you are intentionally changing the numbers so that your calculations show profit. in reality what happens is that first of all the profit is nowhere near that big ($40 in $1000 is 4% you would be lucky with less than 1%), it usually is $1 in $1000 and the risk doesn't justify the small reward.
second thing that happens is that the market is too active specially when there are lots of bots actively looking at the price. it is not just the arbitrage bots but normal ones keeping an eye on other prices like bitcoin price to take action in the altcoin market. for example if bitcoin went down they will automatically dump their altcoin because they know it will go down with a little delay so they want to be first.

Quote from: harastvo on May 09, 2018, 06:00:39 AM
1) Include 1,000 dollars on the stock exchange.
2) Buy buy them 1428XRP.
3) For 1428XRP you are buying 142EOS.
4) You change 142EOS to 1040 dollars.
5) Profit - 40 dollars.
harastvo
jr. member
Activity: 92
Merit: 7
Re: Arbitrage on crypto-currency exchanges: basic schemes!
May 09, 2018, 06:00:39 AM
#1
    It's the continuation of this topic
https://bitcointalksearch.org/topic/m.36608056

Arbitrage transactions can be conducted both within a single exchange, and between several exchanges. Accordingly, there are two basic schemes of arbitration - intra- and inter-exchange.

  • In-exchange arbitration

The scheme is very simple and accessible even for inexperienced users. Its essence - to use the wrong stock quotes for earnings on the difference of rates. Under incorrect, we mean the quotes, which the management of the exchange has not yet managed to "pull up" to the middle level. Most often they are related to the course of crypto currency to fiat and are executed in several steps.

Here is an example of an in-exchange deal, relevant in the past year:

1) Include 1,000 dollars on the stock exchange.
2) Buy buy them 1428XRP.
3) For 1428XRP you are buying 142EOS.
4) You change 142EOS to 1040 dollars.
5) Profit - 40 dollars.

  • Inter-exchange arbitration
The classical scheme is also simple - you buy a currency on a stock exchange with a low quotation and immediately sell on the stock exchange, where the quotation is higher. For example:

1) You buy on the exchange A 500XRP for $ 350 (1XRP = $ 0.7).
2) Sell bought 500XRP at Exchange B, where one coin is worth $ 0.78. You get 390 dollars.
The profit is 40 dollars.
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So, do u have any expirience in arbitration?
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