Topic: What's up with arbitrage (Read 1610 times)

The possibility for arbitrage trading is there, but the execution part is more difficult as we have to take into
consideration the small liquidity of the market at some coins, different transaction and withdrawal fees ,
transaction time. All this is more realistic to be calculated and realized fast by trading bots.

I have also found great arbitrage opportunities in different exchanges that I use, but delays in transactions and sometimes the disadvantageous fees are a great impediment to carry out the arbitrage in an efficient and profitable way. Some occasions I have observed variations of up to 30% for several hours, but when I tried to carry out the exchange, the three-hour delay that took me that transaction made the opportunity absolutely inconvenient.

If you do really like to feel profits on arbitrage trading then you would really need big funds in able to feel it because doing it on smaller funds would really be not worth it considering on the fees on each transactions been made it will surely affect. Price differences or gaps on any exchanges do really occur and as a trader its up to you if you would take the risk on doing it or not.

Which is another limitation for this strategy, in order to obtain significant profits the amount of money you need to risk is huge, a trader can get huge profits by investing a small amount of money in the right coin at the right time, but with arbitrage, you need to have a huge amount of money to obtain small profits, and those profits get even smaller when you get into account transactions fees and the fees of the exchange.

I notice it herein i am worried because when i tried some amounts transfer fron the exchange i used to buy from one another it was a really hard time and sometimes some alts had been hold for withdrawals so instead of making profits it is a loss. I have many factors concerning to arbitrage. The price difference makes an attractibe but the majority is not good one to do. The gap of price and the time in transferring is also a bad experience at me when the deposit was arrived the price was dump already the worst cases.

Since there are literally a lot of exchanges expect these sort of price gaps,the main risk involved with these sort of arbitrage trade is that,it is really impossible to send or receive the coins in time,there was a time when you were able to get faster transaction even with bitcoin and alt coin and i used to take advantage of this price difference,but now that is not the case,even if you send an ETH based token,some exchanges ask for thirty confirmation,which will take hours to confirm which negates the profit.

This is the issue on doing arbitrage things which transfers would either be instant or not depending on the coin you are transacting and depending on which exchange you are in. I agree on the thing you do said that some of them would possibly take some days or weeks to get such withdrawal which this would really be a big problem on doing arbitrage because any delays would really cost you money.

There is no way for a human to pull that off anymore, you will need arbitrage bots to do it for you, and those are costly and difficult to configure, any mistake you make is going to cost you a fortune and a lot of time to recover, that is why arbitrage is not an strategy that is so common despite the apparent benefits that we can get, besides that assumes that the exchanges are going to pay you fast and we know that some exchanges are taking weeks to process a withdrawal.

This uppurtunity seems to be very unreliable in the last few days. Perhaps due to the falling price but at least there is no consistency in the price difference these days as it used to be. I'll keep watching it though.

even this strategy doesn't make sense today because you have unlimited currency exposure
arb bots can make you richer in btc or eth but your total net worth in fiat won't change so what's the point?

bitcoin is down 35% since january 1 and falling further every week, so why would one hold any crypto when regulators are about to crack down big time

Exactly. All the posts here are commenting about transferring deposits to different exchanges. That's not how to do arb, and of course you'll lose money like that. You should have balances in all pairs on all exchanges you intend to arbitrage with beforehand, and then do the arbitration at the exact same time (buy order on one exchange, sell order on the other with no delay). The only time you'd then transfer between the exchanges is much later when funds from one pairing have depleted, or you want to cash out a little.

I did observe that there are many arbitrage opportunities and I do believe that many have benefited from it but then people are somewhat reluctant to do it because there are times when orders would not be executed because of some problems and in case of some huge arbitrage opportunties, most likely the exchange would deactivate the wallet of that certain coin so that traders would not be able to benefit from it. There are some cases then that an arbitrage would be successful but when one arbitrage goes wrong, the one who is doing it would be reluctant to do it again especially if it involves a large amount.

Cryptocurrencies arbitrage isn't profitable anymore, unless you know how to program  and trade with extremely low latency bots that can outperform the domestic bots working on the exchanges servers(certainly not the junk sold in the retail); and even then it requires a 24/7 monitoring of the activity and constant adjustements of strategies and updates by developers as it a highly competitive business in a perpetual race.

The manual cross arbitrage ship has already sailed months / years ago, as the market as grown increasingly competitive and aggressive

I'd like also to emphasize that it is very easy to get badly burnt trying to do this kind of operation without extensive experience. The market is totally unregulated and full of traps settup for the newbies trying to catch price differences. And i've seen many getting badly screwed and go home totally broke. Transfers getting lost, withdrawals stuck for weeks while the currency plunges, deposits not showing up for days, currencies flash crashing, dead pools traps, exchange shutting down,  exchange scams, etc etc..

I think it is unethical to lure people with irrealistic expectations when considering arbitrage and to not warn them about the extreme danger on the long run of trying this. There is no such thing as free lunch in the markets; price differences always have reasons, which mean that 99,9% are untradable because either the exchange is shutdown, nodes are under maintenance, withdrawals are suspended, exchange is a scam, or because the volatility is temporarily extreme and that it is nearly suicidal to even try it

You'd better educate yourself and try your luck with mid-long term trading strategies which have been yielding solid returns until now, rather than trying this near zero profit business only accessible to the most advanced and well funded traders
You could just have bought ETH and hold for the past months and made 30x what you have done doing crappy amateur arbitrage

The withdrawal price of btc is another factor of arbitrage.  This discourage investors to do arbitrage. You need a huge amount of btc to feel the profit from arbitrage.

Sometimes I make arbitrage with low value (less than 100k $) ethereum tokens; but only with small amounts. There is no gurantee that you sell them with profit. I don't like daily trading but I often see arbitrage opportunities between ether tokens. You may watch for them.

If you do not want to risk losing the price when doing Arbitrage, better do not do it. Because I also did it and did not make a profit because of the long delivery time that made me angry. But I should be grateful, because the benefits I get more than the losses that I received.

Yes, bitcoin used to be a good coin for arbitraging and I used to do a lot earlier. However, I have stopped arbitraging using bitcoin because of the slow network and high transaction fees. The slower network will make you loose the opportunity and the higher fees will eat up your profits. So bitcoin is not anymore suitable for arbitraging.

Instead, I will recommend you to use ETH for the same purpose. ETH transactions are superfast and cheaper. So you can move funds from one exchange to another very easily. I am using ETH for the arbitrage trades and it's worth it. Even though ETH price doesn't have much differences in various exchanges, but if you invest a good amount of money, the return will be great.

Arbitrage requires a lot of experience and experience. You have to compete over time and take action within seconds. A friend was making money with arbitrage and losing 7.5 Bitcoin because of the rush, because the wrong address transferred. For this reason it is a very difficult business.

my arbitrage method,

I've partner that live in US and can buy LTC in their exchange, I live in asia where all coin is overprice. I buy LTC from my partner +5% fee, he sent me ltc, I sell it on my exchange +10%.
Compound it.

That's probably a sign that you should stop trading shitcoins. I remember how I have made the same mistake back in 2014. I bought coins from Mintpal to sell them on Crypto at a near 30% higher price. It were instant profits, or at least, that's what I thought. Turns out, that shitcoin had its wallet disabled at Cryptsy, where I had to sell the coins over at Mintpal to get my initial investment back. I "only" suffered a loss of nearly 10% due to the lack of actual buy support. That was my first and directly last encounter with arbitrage trading concerning altcoins. Either just stick with Bitcoin, or else the top altcoins in the market.