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General TradingA

Arbitrage

The practice of simultaneously buying an asset on one exchange and selling it on another where the price is higher, capturing a risk-free profit from the price discrepancy. Arbitrage opportunities are common in cryptocurrency markets due to fragmented liquidity across numerous exchanges. While conceptually simple, successful arbitrage requires fast execution, low fees, and sufficient capital, as price differences tend to close quickly.

Example

The trader spotted a $200 arbitrage opportunity between Binance and Coinbase and executed buy and sell orders within seconds to lock in the profit.