What is bitcoin arbitrage?

Bitcoin arbitrage is an investment strategy in which investors buy bitcoins on one exchange and then quickly sell them at another exchange for a profit. Because bitcoins trade at different prices on different exchanges, it’s an opportunity that many investors have seized in recent years. Arbitrage is not unique to Bitcoin investing.

What is arbitrage trading?

Arbitrage trading is the process of buying an asset for a lower price on one cryptocurrency exchange and immediately selling it for a higher price on a different exchange. The difference between the higher and lower buy-in price is your profit. The concept of arbitrage has been around for many years in traditional markets.

Could a bitcoin arbitrage trader make a profit?

If we take the December 2017 all-time high as an arbitrage example, bitcoin arbitrage traders could have bought 1 BTC at Kraken, transferred it to another exchange with a different price to sell, and could have turned a potential profit based on the price variance, minus fees.