#ArbitrageTradingStrategy

Arbitrage trading in crypto involves exploiting temporary price discrepancies for the same digital asset across different exchanges or markets. The core principle is simple: buy the cryptocurrency on an exchange where its price is lower and simultaneously sell it on another exchange where its price is higher, pocketing the difference as profit.

These fleeting price imbalances arise due to varying liquidity, trading volumes, and geographical demand across numerous decentralized and centralized platforms. While seemingly low-risk, successful arbitrage demands rapid execution, often facilitated by automated bots, to capitalize on opportunities before they vanish. Transaction fees, withdrawal limits, and slippage must be meticulously factored in. Common types include cross-exchange arbitrage, where assets are moved between platforms, and triangular arbitrage, which involves trading three different cryptocurrencies on a single exchange to profit from their relative price differences.