Bitcoin arbitrage, pros and cons, experience and profitability

[Oztwinpeaks]

I have achieved a kind of accident arbitrage when going from Coinjar (Australian) to BitNZ (New Zealand). Buying via Coinjar is a bit like buying from Coinbase- the fees aren't outrageous and withdrawal is free. BitNZ has poor liquidity, but this means that you can quite often get good selling rates because people are desperate to buy (given lack of orders) and move closer to the sell price.
I am not doing this for the purpose of arbitrage- I am simply wanting to go from AUD to NZD- but the end result 80% of the time is to achieve an end conversion that is better than the actual spot currency conversion rate- around about a 1.5-2% gain. I think it would be possible to buy back into BTC on Bitnz and achieve some BTC arbitrage too, but it would require a bit more patience for orders to fill. The benefit with low liquidity exchanges is that the market is often slow to react to broader market movements.

[1715013183]

1715013183

[crazyivan]

Great info, I ll look into these two, never used them before. 

[Minerjoe]

Well with recent news about large investment funds getting into the picture, I expect BTC price to become quite volatile which might create a lot of arbitrage opportunities.

[Nagle]

The problem with inter-exchange Bitcoin arbitrage is that many of the exchanges are sluggish about withdrawals. Also, what with all the fees, exchanges have to be more than 2-4% apart before it pays.

You also have to figure in a > 50% chance that any Bitcoin exchange will go bust.

[durrrr]

the more you spend in bitcoins the better. so if you can start buying smaller items and things you use in bitcoin do it if its not costing you to much. it will help with the growth and stability of bitcoin with more people doing this

[crazyivan]

There was a significant gap between BTCe and Bitstamp today, due to this Chine-related volatility. Unfortunately, I had no fiat available to purchase so I did not sell.

[gentacomp]

Just sharing...
1. Find trading web with chat room but <100 peoples with low volume and no trade fees
2. Check the price, do fast buy let say 1% volume
3. Go to chat and trolling around for 1 hour (play good people, give good news, persuade to buy more etc...) and use different ID if you want
4. Step 2-3 for 3-5 times
5. Sell it back

In 3-5 hours I get about :
80% I get 5%
10% I get up to 20% << Sometimes people just buy what ever the price as long its the lowest
10% lost to 5%

So if I did with 100 BTC, I get :
Profit = 4 BTC + 0.5 BTC (Consider you got bad luck) - 0.5 BTC = 4 BTC

Thanks

[crazyivan]

Just sharing...
1. Find trading web with chat room but <100 peoples with low volume and no trade fees
2. Check the price, do fast buy let say 1% volume
3. Go to chat and trolling around for 1 hour (play good people, give good news, persuade to buy more etc...) and use different ID if you want
4. Step 2-3 for 3-5 times
5. Sell it back

In 3-5 hours I get about :
80% I get 5%
10% I get up to 20% << Sometimes people just buy what ever the price as long its the lowest
10% lost to 5%

So if I did with 100 BTC, I get :
Profit = 4 BTC + 0.5 BTC (Consider you got bad luck) - 0.5 BTC = 4 BTC

Thanks

Sneaky. 

[spin]

Just sharing...
1. Find trading web with chat room but <100 peoples with low volume and no trade fees
2. Check the price, do fast buy let say 1% volume
3. Go to chat and trolling around for 1 hour (play good people, give good news, persuade to buy more etc...) and use different ID if you want
4. Step 2-3 for 3-5 times
5. Sell it back

In 3-5 hours I get about :
80% I get 5%
10% I get up to 20% << Sometimes people just buy what ever the price as long its the lowest
10% lost to 5%

So if I did with 100 BTC, I get :
Profit = 4 BTC + 0.5 BTC (Consider you got bad luck) - 0.5 BTC = 4 BTC

Thanks

Sneaky. 

Though not arbitrage.  As I it's not really risk free.

[gentacomp]

Just sharing...
1. Find trading web with chat room but <100 peoples with low volume and no trade fees
2. Check the price, do fast buy let say 1% volume
3. Go to chat and trolling around for 1 hour (play good people, give good news, persuade to buy more etc...) and use different ID if you want
4. Step 2-3 for 3-5 times
5. Sell it back

In 3-5 hours I get about :
80% I get 5%
10% I get up to 20% << Sometimes people just buy what ever the price as long its the lowest
10% lost to 5%

So if I did with 100 BTC, I get :
Profit = 4 BTC + 0.5 BTC (Consider you got bad luck) - 0.5 BTC = 4 BTC

Thanks

Sneaky. 

Though not arbitrage.  As I it's not really risk free.

Im just lucky because always profit until now. And yeah, nothings is free. Maybe 1 more profit I get is chatting for wasting time, waiting BTC generated from my miners...

[blankia]

The only real arbitrage I did was with bitcoinbuilder. I deposited money into Gox and got it out with around 70% profit margin. I was lucky to get it out in time, because two days later they froze their website. I don't see these opportunities anymore.

If you do arbitrage now, then if you calculate the arbitrage opportunities between exchanges after transaction costs, you can get on average 0.10$ per trade. So your just scalping the markets. This small profit margin wipes out very fast when you make some mistakes or do the wrong trade.  Also you have to do alot and very fast to make it profitable.

[duola9527]

The main problem was how to move BTC and/or fiat between different exchanges and the fact that in order to reduce the arbitrage risk to a minimum one needs to be able to buy BTC on an exchange with low price while selling the same amount of BTC on another exchange with high price AT THE SAME TIME.

[crazyivan]

The main problem was how to move BTC and/or fiat between different exchanges and the fact that in order to reduce the arbitrage risk to a minimum one needs to be able to buy BTC on an exchange with low price while selling the same amount of BTC on another exchange with high price AT THE SAME TIME.

The second part of your posts is really not an issue, especially lately. Due to recent China related events, there is  a lot of volatility creating a lot of arbitrage opportunities. The first part of your post, how to move fiat between exchanges in an issue. Unless you have lots of liquidity. 

[crazyivan]

This weekend the spread between Bitstamp and BTC-e was $26 at one point. Really volatile market, really looks like as if somebody is influencing BTC supply and demand. 

[xybersurfer]

i've tried this. the main issue i had was the amount of it takes to transfer BTC between exchanges. there is more risk if it takes long. volatility also increases risk.

but hearing that it can be profitable makes me want to look into it again.

[crazyivan]

i've tried this. the main issue i had was the amount of it takes to transfer BTC between exchanges. there is more risk if it takes long. volatility also increases risk.

but hearing that it can be profitable makes me want to look into it again.

True, volatility increases risk. But volatility is the essence of arbitrage. If all prices would be the same and stable, no trade there.

[crazyivan]

I guess yesterday was a good day to do arbitrage, over 2% rice difference between Bitstamp and BTCe at one point.

[crazyivan]

Has anyone tried any alts arbitrage and if yes, where and how?

[Mr. Net]

Has anyone tried any alts arbitrage and if yes, where and how?

Netcoins, I make about 10% per trade.
Netcoin on Cryptsy tends to be lower then on bter.com. (look for the NET/CNY pair)

[crazyivan]

The price gap between 2 major BTC exchanges is HUGE today, almost $20 per BTC or close to 4%. We ll see what result are we going to get. Does anyone have any idea why is this price gap so wide?