Is arbitrage still a working concept on a crypto market?

10 000 question challengeCategory: Profits (trading, ICO, mining)Is arbitrage still a working concept on a crypto market?
HowToToken Team Staff asked 3 years ago
1 Answers
HowToToken Team Staff answered 3 years ago

Although there is an opinion that the extraction of arbitrage crypto profits will become impossible pretty soon, William Belk, a founder of, lists 7 reasons for continuation of arbitrage opportunities to appear.

1. Staggering regional competition between exchanges
Users from different regions prefer platforms not only because of interface or speed but also because of platforms’s connection with specific countries. As different factors affect different exchanges (for instance, a ban over accounts larger than N dollars by Chinese government does not affect exchanges with a small number of Chinese users), the price of coins is under very different risks at the same time. What makes a huge momentum impact on one platform, might take long time to be felt by another one.

2. Inability of exchanges to keep pace with demand
It is very difficult for platforms to achieve a sustainably low response time. Sometimes even giants like Kraken fall to provide this.

3. Massive proliferation of individual cryptocurrencies
“Regional influences and the unpredictable addition of new currencies to exchanges around the globe will continue to bring persistent arbitrage opportunities. Because cryptocurrencies are decentralized in nature, with the community able to host its own nodes, there can be no predictable and centralized authority over the global exchanges, protocols, or methods of transfer and remuneration.”

4. Security breaches and hacking will continue to destabilize the environment

5. Regulators will not be able to keep with the profileration of exchanges
Large players might be handicapped at a random as it has already happened in South Korea and USA.

6. Transferring US dollars will remain a nightmare
Right now there are no ways in which allow you to trade free and to move your funds between banks and exchanges very fast. And banks, as they are really worried by threats that are attributed to crypto, are not going to solve this quickly.

7. The future of trading will be peer to peer
Along with greater regulation and transparency will come natural anti-trends. One such trend will be more efficient peer-to-peer trading, or even blockchains whose host nodes support a standardized peer-to-peer trading exchange