Bitcoin Forum

I'm no Einstein but I'm sure I'm not the only person who has noticed the BTC price disparity between 3 of the largest exchanges. Obviously the market is in constant motion but at this time the last trade on
 : BTC-e was 288USD.

 : On Bitstamp its was 299.15USD

 : On MT Gox it was 316.75USD

Why are people not buying coins on BTC-e and then sending them to MT Gox for a $28.75 per coin and then transfer the coins back to BTC-e? There's no commission on Bitcoin transfers so the only reason I can see for not doing this is if you don't trust Mt Gox to transfer the coins back to BTC-e.

Am I missing something obvious here?

KS

Yes, you are.

If people buy coins on Btc-e and then send them to gox for $28.75 per coin, they can't transfer the coins back to BTC-e, because they sold them on gox. Now, in order to get the coins off of gox, they have to once again, buy coins at the goxxian price, which undoes their profit.

Here you go.

To send $$$ to Btc-e they charge you 1% deposit fee. Then they charge you trading fees. So lets call it $1.5% total. Then you send BTC to Mtgox.

Then you have trading fees on Mtgox of .5%. Now you are at a total of 2% fees.

Then you have to convert USD to Yen. That's normally a $4 premium. THEN you have to have a Japanese bank account in order to withdraw the Yen.

Do now you send $100,000 to Btc-e.  Subtracting 2% you are now at $98k.  You buy 340 BTC. You sell them on Mtgox for $312 (316-4). You now have $106k.

However, you might have a delay of 2 to 3 hours to get BTC from 1 exchange to another. What if the market goes down during that period? What if the exchange prices differences decrease before your wire gets to BTC-e?

And do you have a Japanese Bank account anyway?

Thats why it is much harder than it looks.

As cliche as it sounds...

"If it were so easy, someone would have done it already.."

That statement is extremly true in the crypto-world. Lots of innovative people trying everything imaginable, with no minimal government to stifle that innovation. It's really quite amazing. :)

Gox is a crazy bot game that fluxes between 0 and 20% from the other exchanges. China is full of crazy people too and follows gox a lot. Btce has deposit issues so its lower but the direction of the price follows gox like a robot. bitstamp is more stable and represents the true price.

Did you think this through?  What would buying a coin on BTC-e, sending it to MtGox and turning around and sending it right back to BTC-e do?

You would have 1 BTC on BTC-e.  Exactly what you had to begin with.  

If you mean SELL a coin on MtGox for USD and then withdraw that USD, deposit the USD on BTC-e and buy another coin to pocket the difference well as someone said .... if it was easy someone would have done it.

It is nearly impossible to get USD out of MtGox, delays are on the order of MONTHS.  It is also nearly impossible to get USD into BTC-e.  The difficulty is reflected in the different price.

This is why MtGox needs to finally get their ass in gear and start trading litecoin, which could be the facilitator between the exchanges (at least Gox and BT-e) and help stabilize/regulate the price between the two.

That said, I know Gox getting anything in gear is wishful thinking though.

No it wouldn't.  There is no issue in moving BTC between exchanges.  The issue is in moving USD from MtGox to your account to another exchange.   LTC won't magic that problem away.  MtGox fixing their banking system or moving to a country where they can fix their bank access will solve that problem.

Yeah I suppose you're right - the same issue would occur with LTC. My initial thought is it would provide crypto-crypto arbitrage opportunities, but you're right.