ARBITRAGE: Bitstamp -> CEX.IO - Proof of Concept

[buwaytress]

Seems like Bitcoin is refusing to "correct". Gargantuan momentum keeps driving it up - I've noticed volumes on some local exchangers are doubling and some buyers are offering even 5% above polo's ask. I can see a bare 1% profit if I were to buy from these exchanges and sell locally. But without a bankroll the effort's not quite worth it yet.

[Alice Nuttal]

Seems like Bitcoin is refusing to "correct". Gargantuan momentum keeps driving it up - I've noticed volumes on some local exchangers are doubling and some buyers are offering even 5% above polo's ask. I can see a bare 1% profit if I were to buy from these exchanges and sell locally. But without a bankroll the effort's not quite worth it yet.

It feels like the difference in prices offered by Bitstamp and Cex.io is gradually increasing again. Do you really think trading on local exchanges will make higher profit? Are you keeping any particular exchanges in view? 

[mrBTCman]

For me, it is pretty much like short-term investing. You put your money in some asset, keep it and then sell after a short period of time. Does it work like this? Or is it better to sell bitcoins right away? 

Actually the principal idea of arbitrage involves making transactions immediately or close to immediately.

[recklessMe]

Seems like bitcoin price is at the stage of correction. The rates are little different among the exchanges.
Don’t you think it’s the right time to buy and wait until the price goes up?

Bitcoin price has surpassed $3000. And looks like it is going to follow the trend. I'm guessing the difference in prices among exchanges will continue to grow as well.

Probably you are right. But since it reached that mark there has been no significant upswing. Bitcoin price is kept within $2700-2800 range instead.

[sk8LoremIpsom]

One thing to consider in doing arbitrage is the block confirmation time. Nowadays, it average about ~40 https://blockchain.info/charts/avg-confirmation-time?timespan=1days minutes to find each block. Given that time span, bitcoin's price has already flactuated like crazy. Another thing good to note, is the minimum confirmation before a certain btc be allowed to withdraw unto the secondary btc exchanger.

[Supercrypt]

One thing to consider in doing arbitrage is the block confirmation time. Nowadays, it average about ~40 https://blockchain.info/charts/avg-confirmation-time?timespan=1days minutes to find each block. Given that time span, bitcoin's price has already flactuated like crazy. Another thing good to note, is the minimum confirmation before a certain btc be allowed to withdraw unto the secondary btc exchanger.

The chances for going into massively profitable arbitrage trading is being killed by these types of practical problems. Many traders here has reported about getting struck with some exchanges regulations against KYC and now a days bitcoin confirmation delay must be a very big hurdle to go for profitable arbitrage trading.

I tried few times within my local exchanges even it involves bank transfers, due to some prior experiences I was able to crack some profits. I targeted big gaps, but when I got ready prices got little near in both the exchanges.

[buwaytress]

Seems like Bitcoin is refusing to "correct". Gargantuan momentum keeps driving it up - I've noticed volumes on some local exchangers are doubling and some buyers are offering even 5% above polo's ask. I can see a bare 1% profit if I were to buy from these exchanges and sell locally. But without a bankroll the effort's not quite worth it yet.

It feels like the difference in prices offered by Bitstamp and Cex.io is gradually increasing again. Do you really think trading on local exchanges will make higher profit? Are you keeping any particular exchanges in view? 

Yes, local exchanges tend to be quicker when it comes to liquidating your crypto, depending on the country you're in. The problems with the exchanges we're talking about here, as noted by other responses, is simply practical problems such as network confirmation delay and delays in processing withdrawals.

But a local exchanger generally lets you access local banking for instant or near-instant resolutions, so you're less affected by price fluctuations.

Still, as I mentioned, you do need large volumes to be able to float profit.

[mrBTCman]

Seems like bitcoin price is at the stage of correction. The rates are little different among the exchanges.
Don’t you think it’s the right time to buy and wait until the price goes up?

Bitcoin price has surpassed $3000. And looks like it is going to follow the trend. I'm guessing the difference in prices among exchanges will continue to grow as well.

Probably you are right. But since it reached that mark there has been no significant upswing. Bitcoin price is kept within $2700-2800 range instead.

However the price gap between bitstamp and cex is within $200 or so. 

[JJ17]

Hey guys,

has anybody of you ever used the withdraw to VISA function on CEX.io successfully?

Because the biggest hurdle to arbitrage trading on cex.io as I see it is the setting up the fiat side of the circle, since the normal transfer options like SEPA can take weeks according to multiple post on this forum.

[Victorycoin]

Hi everyone!  

I am newbie on bitcointalk.org and hope that I created thread in right place.

I have an idea how to make arbitrage between exchanges and make money without any risk.

But I am trying to undertand where I am wrong.



The idea is simple - buy bitcoin on Bitstamp @$2374.99 and sell on CEX.IO @$2540.00.
Profit is $165.01 per 1 BTC.


Could you dab me where I am wrong?  

If you have big enough amount money then it is worth to wait even 20 days. Otherwise doesn't worth to wait. I know some people doing this all the time but most of them doing this as a company so they can play with big amount money.

Actually it could come easier and more profitable with the availability of some significant fund. You circumvent the fees and time lag by having significant amounts of fiat and crypto at both or all the exchanges you intend working with, then as you buy say 1BTC at the cheaper exchange, you also sell 1BTC at the other exchange with higher price. After several transactions you can now cash out without any pressure. 

[Alice Nuttal]

Hey guys,

has anybody of you ever used the withdraw to VISA function on CEX.io successfully?

Because the biggest hurdle to arbitrage trading on cex.io as I see it is the setting up the fiat side of the circle, since the normal transfer options like SEPA can take weeks according to multiple post on this forum.

I used cex.io withdrawal function many times. Of course, sometimes there may be a bit of a delay,  but in most cases the withdrawal is completed instantly. It is another reason I chose it for arbitrage.

[Wholesaleff]

Arbs only happen, of course, in times of high volatility. Otherwise - the markets are very well optimised given the number of bots operating.

The "arb" from exchange to OTC remains open though! And some currency pairs into OTC

Good Luck

[Herbert2020]

Arbs only happen, of course, in times of high volatility. Otherwise - the markets are very well optimised given the number of bots operating.

The "arb" from exchange to OTC remains open though! And some currency pairs into OTC

Good Luck

what do you mean by OTC? something like peer to peer exchange, off exchanges and selling to people, like what they do on localbitcoins?
if that is true, then i don't think you can call it "arb"itrage trading anymore. it is just buy low and sell high to people who don't want to go to exchanges to buy cheap! it is more like a business, and you have to gain "customers" by building up some reputation.

[yugoslav]

CEX now has lower price than Bitstamp or BIttrex, does anyone knows what might be the cause??

[alessandromanzoni]

Can I make a question very silly but that I need to be answered. You say you buy lower at Bitstamp and then you sell an higher price at Cex.io.
Ok I undertand this, but when does Cex.io knows that my position is not a short position and that I have already bought it elsewhere?
Does the system do it automatically?
Or do I need to prove it to them about my long position elsewhere?
I am a novice, so please just be easy and try to explain this to me.
Thanks in advance to anyone who will give the right answer.

Alessandro

[Serpens66]

Can I make a question very silly but that I need to be answered. You say you buy lower at Bitstamp and then you sell an higher price at Cex.io.
Ok I undertand this, but when does Cex.io knows that my position is not a short position and that I have already bought it elsewhere?
Does the system do it automatically?
Or do I need to prove it to them about my long position elsewhere?
I am a novice, so please just be easy and try to explain this to me.
Thanks in advance to anyone who will give the right answer.

Alessandro

first understand trading in general before considering anything else.
Bitcoin trading is not forex or any of this rubbish.
You buy real btc , send real btc and sell real btc elsewehere. So no need of short/long positons.

[hitrawal91]

Well, Arbitrage is really and cool and easiest way to make money if you are a trader but provided you have two exchanges with the bigger margin of buying and selling prices there on their trading screen. You need to make sure that you don't see any kind of commissions or big transaction charges because arbitrage is possible only when you cut the excess of transactions fees and if you time the trade correctly otherwise you will be breakeven on most of the occasions. I have tried it many times on stock exchanges while trading stocks.

[Ashimwe]

arbitrage is very profitable but my worst fear is the change that happens when moving one exchange to another

[Symbolic]

What the heck happened to Cex? It's at only 1.5% premium now vs other exchanges. It used to be 8-10%.

With their shitty withdrawals this is a worthless exchange now.

Did this happen because of them partnering with other exchanges etc or because the big drop in market the overall interest is low in Cex? (Which doesn't make logical sense as Cex was always a premium market)

[exchange.blue]

Hi everyone! 

I am newbie on bitcointalk.org and hope that I created thread in right place.

I have an idea how to make arbitrage between exchanges and make money without any risk.

But I am trying to undertand where I am wrong.



The idea is simple - buy bitcoin on Bitstamp @$2374.99 and sell on CEX.IO @$2540.00.
Profit is $165.01 per 1 BTC.


Could you dab me where I am wrong? 

This should help
http://www.arbitrage.expert