Bitcoin Forum

say.. BTC is $1070(sell) on poloniex and $1135(sell) on cex.io why would anyone sell his bitcoin on poloniex at the moment and not transfer them to cex and sell them in there?
The reversed is still true, why would anyone buy on cex since the bitcoin is way cheaper on other markets?

Well there are many factors to factor in when it comes to the prices on the different exchanges.

Given the transaction fees + the fees implemented by the different exchanges, it would usually not be profitable to buy at the cheap end and sell at the expensive end. Time is an issue.

In addition, some traders favor specific exchanges as they have a vested interest or holding on there, you also need to take into account, bots, automated traders, and even time zone differences from different countries.

The only thing that is certain that between the major exchanges, the price of btc in usd will usually fluctuate between 1-15% based on many factors, most of which i have listed above.

i tottally get the second part of your message, but i am not sure why it would not be profitable to switch markets
For example moving bitcoin from 1 wallet to other is free, then selling for 1135 sounds way better then for 1070 and buying the same in opposite dirrection.
What do you mean exactly by not being profitable? That is the part i did not fully understood.
Maybe a short mathematical example would help

It all comes down to supply and demand on different exchanges.  what people are willing to sell it for and what people are willing to buy it for is what dictates the price.  ;)

Yes, you are most welcome to do so and you can make instant profits by doing this type trading across exchanges. This type of trading is termed as arbitrage trading and people are loving to do this as it will not involve risks as you can make profits by just making buy and sell in quick times (no waiting in between buy and sell).

Bitcoin prices are being determined when people buy/sell it. When one exchange is very much concerned about verification and accommodations, it will have very less volume and hence prices will be moving slowly. That must be the reason cex prices are lagging. You can buy from any exchange where prices are comparatively low.

Like el kaka mentioned, some people do this kind of trading to get profits from the margins quickly, however, buying and selling may incur different fees, add the withdrawal fee and the volatility of the prices to +-100 in short periods of time, by the time you transfer the what you bought from A to B, there are occasional periods where the price at the higher price point would have stabilized. Also probably why people convert to altcoins before hand for even more drastic profit margins

Because the different volatility of the market will give the different volume and supply. The volatility if the market are making everyone to still buy on that market and not try to buy on the other place with the cheap price. The arbitrage trade is very risky. don't try this at your home.

because bitcoin not central price
so every exchanger can difference price, only supply and demand in exchanger can get difference bitcoin price
bitcoin not fix rate price, not regulation if all exchanger must same price

the reason is always because of the exchange platform and their options.
for example poloniex doesn't have a USD market at all, that is an altcoin with the same value as USD called USDT. and also cex.io is a direct fiat deposit and you can use credit cards so they are different.
for example btc-e usually has lower prices during volatile times but that is because depositing and withdrawing money has huge fees and that fee always defeats any possibility of making profit from what you are describing which is also known as arbitrage trading.

This is also exist in dollars exchangers and others currencies and this what expert called arbitration. There will ever be different on different exchangers because of volumes, time and place. Many arbitrage traders are taking advantage of it to gug out profit every days.

I feel that you might have a strong point in there but i did not fully get the idea, could you offer a concrete mathematical example?

I am looking for a BTC is.... on ... market if i .... and ... then ... type of explanation, that would make it clear why is so risky

Yeah and another thing is that. Different trading platform are not synchronized with each other. Meaning their prices are independent with each other. It varies because the price in every platforms depends on the traders itself. That's why when you compare the prices of a certain coin (or even bitcoin), you can see a slight difference in its price.

And as what have been said above some traders took this opportunity to generate profit or a strategy called Arbitration. It is buying at a platfrom with the lowest price then transfer the coin into the platform with the highest selling price.

Thats why we can see some arbitrage trader since market price on each trading sites are different from one another and to lucky for the people if they spot a cheap coin on other site and sell on site who's price are bigger, I've lucikily done this for many times and yet try to spot for another coin that gives me another income from it. And also my other conclusion is other sites got different whales support and maybe thats the reason why we can see some downfall on other exchangers.

They're doing it.

Of course it's an entire job to do the correct arbitrage.
Not as easy as it seems because you have to take into account all the fees and the time needed to do the transfer ^^

Yes, the time delays to  get approved for withdrawal and then network conformations are biggest enemies to kill our plans of doing arbitrage trading. I tried any times to trade across exchanges but got many similar hurdles to throw away myself out of those earning opportunities. Maybe having enough accounts and funds on those exchanges would be a solution here.

But usually buying prices in one market would be higher than what seller do offer in another exchanges. So arbitrage opportunities are very rare and being ready with funds across exchanges are not feasible for many traders.

The prices gaps across exchanges are usually convergences in quick time usually.

You have taken example when bitcoin price was dumping really hard so difference look huge at that time. But if you look right now, difference is of only few $ and there will be always some difference in price between different exchanges due to lots of factor like the payment processor they support for deposit/withdrawal, trading fees, fees on deposit/withdrawal, number of active traders and daily trading volume in those exchanges etc.

For a simple person in simple words I will say that different exchanges show different prices because of the crowd on different exchanges. Suppose on one exchanges there are many people to buy bitcoins and the sellers find that they can easily sell at high price so the price at that exchange increases while in others where the buyers are not much in number the sellers try to keep lower in order to get some buyers.

because each exchange has a user that is different. anybody can perform different actions. This makes different prices.
usually an exchange that has a lot of users will have a competitive price.

Interestingly enough, they all have their own marketplace software. So, the person who sells bitcoin on one exchange for altcoin, is not exchanging it on another at the same time. You get to do it only on one exchange.
Meaning the highest volume exchange will have less risk and less volatility.

Tough the one that starts new and has low volume might be more open to speculation and prices will change quickly depending on the people.

Arbitrage bitcoin is risky, besides the fluctuation and volume, you need to consider transaction speed, it's very necessary if you want to do arbitrage.
You said transfer amount of btc is free.. No, exchange charge the fees too. Although the fees is near free compared with other payment processor.

I think altcoin is good to trade arbitrage, because typically more fast.

Each website has it's users. For someone one website is good to use with it's interface and etc, for someone - second. Also there are many factors and that's normal, price difference means it is decentralized and as everyone knows, such difference in bitcoin price excist because of previous reason.
Well, to my mind that's because there is no official global bitcoin price.

Bitcoin has a global price since its price depends on the various trading site such as BTCC, Bittrex, Okcoin, and etc. Its price rely on the sell order and buy order for each site. As sell orders are more than buy orders, then that's the time bitcoin's price would go down. Bitcoin is decentrelized currency that its rate is upon its users demand and supply, same as forex.

When there is no law, regulations telling exchanges to set their prices properly, this shows the true decentralization of cryptocurrencies.
Even if you see $1170 on an exchange how many coins can you sell or buy with exact amount?

That is right, each exchange fixes their own rate according to their demand and supply but their computers endeavors to sync their prices, which is one reason those wild disparities doesn't stay long. There are some traders that actually set out to hunt for these disparity and exploit them. The use of software makes it less stressful and quicker to spot and respond to. So next time you spot such differences in price and the fee are not disagreeable, go ahead and make some coins out of the situation - network speed permitting.

It's because there is no regulation and there's no regulator or body of international government that monitor bitcoin exchanges price. If you are familiar with "suggested retail price" for products in supermarkets. The same thing is bitcoin exchanges, since there is no suggest bitcoin price. An exchange can adjust the amount that they desire.

This is nothing but mis-pricing of security, in theory of efficient market hypothesis EMH by Eugene Fama, an asset price incorporate all the available information and will be trading at fair value.

In reality, we are not part of perfect market, most of the markets worldwide are semi-strong efficient. What it means is, the new information takes a while to get reflected in the price. whereas in perfect market (strong form of efficiency) stock price reflects as soon as some information is made available.

To link this to your question, it may happen that the investors in different stock exchanges may be not aware of the exact information leading to different pricing of same security in two different markets.

It may also happen that as the prices of a security is derived from actual transactions, availability of buyer and seller also be a reason. A higher liquid market absorbs the information faster than relatively illiquid market.
Happy Investing!!!

1) Front-running. It used to be rife on the mainstream stock exchanges until they made it illegal. 

Front-running is where you know what your client will do next and you trade before him, knowing that his later trade will change the price in your favour.

The exchanges know how much cash their clients hold.  They also have power over how long it takes before they credit you with the dollars you just sent to the exchange.  They say it takes one to eight days.  It should be the same value day.  They can credit all clients on a Sunday night, knowing the wave of buying will start on Monday morning.

Once your coins are on the way to the exchange or already arrived its not worth the time or trouble to move them to another exchange.

2) For exactly the same reason as above, most exchanges don't take Tether.  If they did, you could instantly arbitrage between exchanges, thus undermining their profits from front-running.

I think the reason behind why there are some differences in prices between the exchange markets is the commission or additional charge that they impose in all transaction. In this way they can earn revenues that will support all of their expenses and the excess will be their income .

It’s a very nice thinking and it is a very good question. In this online market there are too many exchange but the take a charge different amount, it’s main resin is site capacity and popularity and some website have too many worker so they accept high fees and his service is very useful. 

I think the best reason from this why there are different exchange rates in different markets is because of the mark up cost or the commission that they imputed in this rates.
All exchange market companies earn revenues through putting commission in exchange rates. For me this regards the price because the more important is the quality of service they provide in every customer.

I'm seeing  huge price gaps in the same exchange, but different pairs as well, for example in kraken bitcoin price in euros is higher than in USD. This is all due to usd/euro exchange rate or other parameters?

It is depend on his website and it's depend domain security, some crypto currency site have a best protection as like bittrex, Binance, Poloniex so this site have a different price and different exchange fees and also depend how many worker stay with this company.

 In addition there is also the difference in the volume of people who trades. It might be a lot greater on this exchange than the other. So if the demand is greater on this exchange then the price will also increase.
 It would be hassle and time consuming if you would buy btc in this exchange and trade it to other exchange. You'll go bankrupt with the price of the transaction fees implemented on each exchange.

Because each exchange market has different trader, different people will place different orders so different prices. The difference between the exchange floor is the reason for the price of Altcoin up or down.

I think it's good., just choose an exchanger that's already familiar with you and it has been proven can be trusted and you feel comfortable with it.
And I think for exchangers that are proven can be trusted and already famous, it certainly will be the most updated about the development of the coins prices and in accordance with the facts.

Actually that is the thing I observed in different exchange market. I think the reason behind of this thing is the commission that they imposed in each transaction. There are some companies that is too much expensive in terms of its services while others are cheaper.

In each market the number of transactions takes place differently and the amount of money and coins in the exchanges markets is different so prices will vary. in the addition,   the price in the exchange are regulated by the trader and depend on the need of buying and selling.

They're all independent structures and this is normal when you understand they're independent. The price can't follow the same path everywhere because the traders are not the same people everywhere. They're all different traders with different order books.

I think that a lot of people were doing a lot of arbitrage between the traditional exchanges and the korean exchanges, and they were shut down a few days ago.
Maybe you do not care about this, but this is the root of the thread, the korean exchanges were the first example about expensive exchanges, and the traditional ones, the cheap ones.

Market price is determine by both buyer and seller, the order that on an exchange is what is being used to set the price, it is not even controlled by the exchange, that is how market works.

It is because in different market there has different admins and different number of users, and in every crypto market there has a different prices of taxes that they paid ,
thats why there have a different prices in the exchange market.

Hi,

I noticed that there are some huge differences on exchanges for E-coin (ECN) . For example : it's worth 90 $ on Yobit, 160$ on coin exchange and 7 $ on c-cex. I get it that there might be slight differences, but this huge ?!?! 

Also, did any of you guys trade on any of those 3 exchanges? which would be the safest choice ?

this way and used by large players, called it arbitrage, a simple investor is not profitable to do this you need to have a lot of money on each exchange. And with the arbitrage traded mostly robots! Here's the link for comparing prices: http://www.arbitrage.expert/

Because the volume of cryptocurrency market still small compare others market like stock or forex, and that why exchange have different price. And also the demand in each exchange also different, small volume also will become the price less in liquidity.

The fact that withdrawal fees, late deposit on requested exchange when the price stabilises and the associated trading fees are some factors hindering me from arbitrage trading. Maybe I'll try it out with little cash  8)