I decided to explore something new for myself because I already have a lot of theories. Cryptocurrency arbitrage is essentially buying crypto cheaper on one platform and selling it more expensive on another. That’s how they make a profit from the difference. It sounds simple, but there are nuances.

Why does such a scheme actually work? The prices for the same coin on different exchanges can vary significantly. There are several reasons — different levels of demand and supply, delays in updating quotes, plus regional differences in legislation and demand. That’s what creates opportunities.

In terms of types of arbitrage, I’m not entirely sure yet. Inter-exchange arbitrage is when you buy on one platform, transfer, and sell on another. For example, buying Bitcoin cheaper, sending it to a second exchange, and selling it for a higher price. Intra-exchange arbitrage works within a single platform — you use the difference between trading pairs. For instance, ETH/USDT is cheaper than through BTC, you convert, and make a profit. Triangular cryptocurrency arbitrage is more complex — you exchange currency through several pairs in a row: USDT to BTC, then to ETH, and back to USDT. There’s also regional arbitrage — buying crypto on a major exchange and then selling locally via P2P in another currency with a markup.

Where to start? Accounts on multiple platforms are needed, that’s clear. Replenishing your balance with stablecoins like USDT or USDC is the easiest. Then monitor prices through special sites or bots — you can catch the difference there. Be sure to account for commissions, or all your profit will go to them. Speed of transfer is also important — if the network is slow, the price may change while the crypto is in transit. For quick operations, TRC-20 or BSC are better.

A practical example: suppose Bitcoin costs $96,000 on one major exchange and $96,100 on another. You buy on the first, send it to the second, and sell. Profit of $100 minus fees. It sounds simple, but here are the pitfalls.

Fees can completely eat up the profit if they are high. Transfer delays — while the crypto is moving, the price can drop. Withdrawal limits are present on many platforms, which also restricts. Plus, there are risks of account blocks due to regional restrictions or suspicion of fraud.

Is cryptocurrency arbitrage a truly working method, or am I missing something? I’d like to hear the opinion of experienced people because I’m still not entirely confident. Has anyone tried it already?