What is Crypto Arbitrage?

December 28, 2021 12:54 AM AEDT | By Daniel Paul Johns
 What is Crypto Arbitrage?
Image source: © Rastudio | Megapixl.com

Highlights

  • Crypto arbitrage is a way to make money off cryptocurrency without exposing oneself to the risk involved in day trading and investing
  • Crypto arbitrage is where investors capitalise on slight price differences of a cryptos across multiple markets or exchanges
  • Arbitrage Underdog Evergreen claims to be the most advanced, and profitable arbitrage software of its kind
  •  

Anyone who spends their time trading cryptocurrency will tell you it’s not for the faint-hearted. It’s a stressful business whose side-effects often include lack of sleep, high blood pressure, hypertension and, in the worst cases, complete and utter despair.

That’s not to say it’s all bad, of course. Conversely, crypto trading can be accompanied by feelings of euphoria, increased adrenaline and, in some cases, a compulsive desire to inform friends and family about the trade that just made you a fortune.

Such is the manically volatile and unpredictable nature of the crypto markets, that traders can potentially experience all these side effects, good and bad – sometimes in the same day.

What many might not know, however, is there’s a way to make money in the crypto market without exposing oneself to the risk involved in day trading and investing.

Crypto Arbitrage

Crypto arbitrage is where investors capitalise on slight price differences of a cryptos across multiple crypto exchanges.

In basic terms, the investor buys a digital asset on one exchange and then immediately sells it on another exchange where the price is higher.

Now admittedly, the price discrepancies are only very slight and therefore when the investor sells they’re only making a small profit. But if you do this several times a day, you’re guaranteed to make money with practically no risk involved.

Let’s look at an example.

Let us assume, the price of Bitcoin (BTC) on the Binance Exchange is US$56,547. Now, if we go over to another popular exchange, Kraken, Bitcoin’s price is US$56,565.

In this scenario, the investor would buy Bitcoin from Binance and then immediately sell on Kraken.

Now granted, that’s only a profit of US$18, but bear in mind, it’s an quick and easy process which really only requires the pressing of a couple of buttons. Not to mention that the discrepancy between exchanges on a token can be much higher, resulting in a greater profit.

Also remember, there’s practically no risk involved. If you perform this tactic many times over, you can pocket quite a good income.

Evergreen– Crypto Arbitrage Software

Arbitrage Underdog Evergreen claims to be the most advanced, and profitable arbitrage software of its kind.

This software, more or less, does the research for you, putting leads on one side of the screen, while matching those leads up with sellers, meaning the investor doesn’t have to do the time-consuming research.

The Verdict

 If you’re unfamiliar with cryptocurrency and want to see what the big deal is about then crypto arbitrage is a good way for you to make money with very little risk.

What it also does is introduce you to the concept of cryptocurrency pricing and crypto exchanges, so if you do decide to get involved in crypto trading or investing, you’ll at least have some knowledge under your belt.


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