Bitcoin Arbitrage

Arbitrage is a trading method where one buys a coin from any exchange that has the lowest price of the currency in the market and selling the coin in an exchange with a much higher value. The main reason for this price difference among different exchanges is because the prices of a coin are dependent on the last trade. As there are a different number of people on different exchanges with different preferences thus the prices vary too.



For example, if the price of BTC is $4000 in exchange A and $4500 in exchange B. An investor can buy 10 BTC from exchange A which gives them a value of $40000 total. Now they selling these 10 BTC on exchange B. An investor gets a total value of $45000. This is a profit of $45000-$40000= $5000.



In financial investing, arbitrage refers to the simultaneous buying and selling of the same asset or security on different exchanges to profit from price differentials on these exchanges.



For example, if the price of an asset is trading at $100 on exchange A and at $98 on exchange B, an investor can purchase the asset for $98 on exchange B and then immediately sell it for $100 on exchange A to generate an effectively risk-free profit of $2. This is the concept of arbitrage trading.



In Brazil, bitcoins are subsumed under the general class of "intangible goods" but without any proper identity. Intangible property that is worth money. In Brazil, cryptocurrencies are similar to shares. But being intangible goods they are not subjected to import tax or other customs duties.



Another example is Colombia, which is ranked 7th in terms of Bitcoin trade. In the past years, Colombia has witnessed a growth rate of bitcoin trade which makes it a very fertile ground for Bitcoin arbitrage.



There are a number of good platforms in Malaysia like Luno where investors can easily buy and sell Bitcoins and earn profit through arbitrage.