$20,000 in three days? It sounds impossible, but here's how I did it.
Unlock the secrets of arbitrage using this Ultimate Arbitrage Guide and make money fast π§΅π
Unlock the secrets of arbitrage using this Ultimate Arbitrage Guide and make money fast π§΅π
What we'll be covering:
β’ What arbitrage is
β’ What you need to prepare for arbitraging
β’ How to find arbitrage opportunities
β’ Arbitrage strategies: CEX-DEX, DEX-DEX, Spot-Futures, Listings
β’ What problems you may run into during arbitrage
Let's dive in π€Ώ
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β’ What arbitrage is
β’ What you need to prepare for arbitraging
β’ How to find arbitrage opportunities
β’ Arbitrage strategies: CEX-DEX, DEX-DEX, Spot-Futures, Listings
β’ What problems you may run into during arbitrage
Let's dive in π€Ώ
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What is Arbitrage?
Arbitrage is basically buying a token on one exchange cheaper than on another, transferring the tokens to the exchange where the price is higher, and selling them there.
See the visual explanation of the concept here:
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Arbitrage is basically buying a token on one exchange cheaper than on another, transferring the tokens to the exchange where the price is higher, and selling them there.
See the visual explanation of the concept here:
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Of course, it's a simplified explanation, so it doesn't cover most of the complicated arbitrage strategies where you don't need to withdraw any tokens, you need to use bridges between blockchains, etc, but we'll talk about it more later.
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What you need to prepare for arbitraging:
β’ CEX accounts
β’ Basic DeFi knowledge
β’ Some funds
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β’ CEX accounts
β’ Basic DeFi knowledge
β’ Some funds
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CEX Accounts
Many CEXes don't allow you to use their services unless your account is verified. So, you need to create accounts on all major exchanges and pass KYC verification.
I've compiled a list of CEXes you should definitely have accounts on:
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Many CEXes don't allow you to use their services unless your account is verified. So, you need to create accounts on all major exchanges and pass KYC verification.
I've compiled a list of CEXes you should definitely have accounts on:
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For many arbitrage strategies, you need to use DEXes, lending protocols, etc. So, some basic DeFi knowledge is certainly needed to profitably arbitrage.
If you don't know anything about DeFi, watch the video below:
youtube.com
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If you don't know anything about DeFi, watch the video below:
youtube.com
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Unfortunately, you can't start arbitraging with no money at all. You need to have at least $100-1000 to get some profit from arbitrage situations.
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How to find arbitrage opportunities:
β’ Manually
β’ Arbitrage scanners
β’ Other arbitragers
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β’ Manually
β’ Arbitrage scanners
β’ Other arbitragers
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Most beginners find arbitrage opportunities manually.
They check token prices on different CEXes/DEXes and calculate the difference between them. If the difference is good enough to arbitrage, they start to arbitrage this token.
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They check token prices on different CEXes/DEXes and calculate the difference between them. If the difference is good enough to arbitrage, they start to arbitrage this token.
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But arbitrage experts usually use special scanners which process the information on all trading pairs from exchanges and give out those pairs for which there is a difference in price.
As far as I know, these scanners aren't sold anywhere, so you need to write them yourself.
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As far as I know, these scanners aren't sold anywhere, so you need to write them yourself.
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Also, if you have friends who are arbitragers, they may share with you information on arbitrage opportunities.
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CEX-DEX strategy
If the price of the token is higher on CEX than on DEX, you can buy the token on DEX, deposit it on CEX, and sell it there.
Example of $DC CEX-DEX arbitrage:
Spent on DEX: $15370.7 USDC
Received on CEX: $15688.85
Profit: $318.15
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If the price of the token is higher on CEX than on DEX, you can buy the token on DEX, deposit it on CEX, and sell it there.
Example of $DC CEX-DEX arbitrage:
Spent on DEX: $15370.7 USDC
Received on CEX: $15688.85
Profit: $318.15
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DEX-DEX strategy
Sometimes price difference occurs between different blockchains, so you can buy the token on the chain where the price is lower, bridge it, and sell it higher.
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Sometimes price difference occurs between different blockchains, so you can buy the token on the chain where the price is lower, bridge it, and sell it higher.
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Example of $DC DEX-DEX arbitrage:
Spent: $9236 (Dogechain DEX) + $9480 (hedge on MEXC)
Received: $9214 (Uniswap) + $9593 (MEXC after closing the hedge)
Profit: $91
Too many screenshots of these transactions, so I didn't include them all here
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Spent: $9236 (Dogechain DEX) + $9480 (hedge on MEXC)
Received: $9214 (Uniswap) + $9593 (MEXC after closing the hedge)
Profit: $91
Too many screenshots of these transactions, so I didn't include them all here
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Spot-Futures strategy
When the price of futures is higher than on spot, you can buy tokens on spot and hedge them on futures.
When the price difference between them becomes 0%, you will be able to close your positions with some profit.
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When the price of futures is higher than on spot, you can buy tokens on spot and hedge them on futures.
When the price difference between them becomes 0%, you will be able to close your positions with some profit.
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Example of $DC Spot-Futures arbitrage:
Spent: $2845 (Kucoin) + $2825 (hedge on MEXC)
Received: $2980 (Kucoin) + $2744 (MEXC after closing the hedge)
Profit: $53
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Spent: $2845 (Kucoin) + $2825 (hedge on MEXC)
Received: $2980 (Kucoin) + $2744 (MEXC after closing the hedge)
Profit: $53
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Listings strategy
Sometimes when a token gets listed on a CEX, its liquidity there isn't enough to meet the demand. This can cause the price to skyrocket.
You can buy tokens in advance, deposit them on the CEX, and then sell higher at the moment of listing.
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Sometimes when a token gets listed on a CEX, its liquidity there isn't enough to meet the demand. This can cause the price to skyrocket.
You can buy tokens in advance, deposit them on the CEX, and then sell higher at the moment of listing.
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Example of $DC listing arbitrage:
Spent: $20000 (Uniswap)
Received: $20923 (Kucoin)
Profit: $923
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Spent: $20000 (Uniswap)
Received: $20923 (Kucoin)
Profit: $923
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What problems you may run into during arbitrage:
β’ CEX account bans
β’ Spread disappearing
β’ Deposit/withdrawal issues on CEX
β’ Any other problems
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β’ CEX account bans
β’ Spread disappearing
β’ Deposit/withdrawal issues on CEX
β’ Any other problems
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CEX account bans:
Sometimes CEXes ban accounts for various reasons. Most of the bans can be easily removed by providing documents required by CEX support, but this process takes time - so you won't be able to arbitrage with that CEX for some time.
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Sometimes CEXes ban accounts for various reasons. Most of the bans can be easily removed by providing documents required by CEX support, but this process takes time - so you won't be able to arbitrage with that CEX for some time.
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Spread disappearing:
When you buy tokens on a DEX, you hope to sell them higher on a CEX. But nobody guarantees that the price wonβt drop after you make a deposit - meaning sometimes you have to sell at zero profit or even a loss.
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When you buy tokens on a DEX, you hope to sell them higher on a CEX. But nobody guarantees that the price wonβt drop after you make a deposit - meaning sometimes you have to sell at zero profit or even a loss.
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Deposit/withdrawal issues on CEX:
If you see a good spread between CEX and DEX, always check if it's possible to deposit/withdraw this token on CEX.
If these functions are closed, you won't be able to get your profit from this arbitrage opportunity.
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If you see a good spread between CEX and DEX, always check if it's possible to deposit/withdraw this token on CEX.
If these functions are closed, you won't be able to get your profit from this arbitrage opportunity.
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Any other problems:
There are a lot of random issues that can come up when you're trying to arbitrage tokens. For example, bridges between blockchains needed for executing arbitrage trades may not work, or CEXs stop stablecoin withdrawals, etc.
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There are a lot of random issues that can come up when you're trying to arbitrage tokens. For example, bridges between blockchains needed for executing arbitrage trades may not work, or CEXs stop stablecoin withdrawals, etc.
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That's all I wanted to tell you in this thread.
If you want to start arbitraging but still have questions, feel free to ask them in the comments.
If you want to start arbitraging but still have questions, feel free to ask them in the comments.
I hope you've found this thread helpful.π
Follow me @rektfencer for more
Like/Comment/Retweet the first tweet below if you can.
Follow me @rektfencer for more
Like/Comment/Retweet the first tweet below if you can.
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