Arbitrage
strategy · trading
The practice of exploiting price differences for the same or related assets across markets.
1.strategy
Arbitrage is a trading strategy that attempts to profit from price discrepancies. A trader buys where an asset is cheaper and sells where it is more expensive, or uses related markets to capture a temporary mismatch.
2.types
Crypto arbitrage can be spatial (between exchanges), triangular (between trading pairs), DeFi-based (between liquidity pools), or funding-rate based (between spot and derivatives markets). Many opportunities are automated and disappear quickly.
3.risks
Arbitrage is not risk-free. Execution can fail because of price movement, network congestion, bridge delays, exchange withdrawal pauses, MEV, inventory constraints, or inaccurate market data.
Related terms
Cryptocurrency Exchange
→A cryptocurrency exchange is a platform for buying, selling, or trading digital assets through crypto or fiat markets.
trading · exchange · platform
Decentralized Exchange
→A decentralized exchange (DEX) lets users trade digital assets from their wallets through smart contracts or peer-to-peer settlement.
trading · exchange · blockchain
Transaction Fee
→The network cost of processing a transaction, separate from the amount sent to the recipient.
blockchain · technical · basics
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