Types of #Cryptocurrency #Arbitrage

Inter-Exchange Arbitrage: Buying on one #exchange and selling on another where the #price is higher. Speed is crucial to minimize the risk of price changes during transfers.

Triangular Arbitrage: #Trading between three pairs on a single exchange to #profit from price discrepancies among them.

Cross-Chain Arbitrage: Taking advantage of price differences for the same asset across different #blockchains (e.g., using bridges between #Ethereum and #Binance Smart Chain). Quick execution is essential due to potential fees and transfer delays.

#Futures and #Spot Arbitrage: This #strategy exploits price discrepancies between the spot and futures #markets. An asset is bought on the spot market and simultaneously sold on the futures market, allowing #traders to lock in price differences.

Flash Loan Arbitrage: Utilizing decentralized finance (DeFi) flash loans to execute arbitrage trades without collateral. Traders borrow large sums instantly, profit from price discrepancies between decentralized exchanges, and repay the loan in a single transaction. If the trade is not profitable, the transaction is reverted, mitigating risk.

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