#ArbitrageTradingStrategy is a trading strategy that exploits price differences of the same asset on different exchanges or markets. The goal is to buy cheaper in one place and immediately sell at a higher price elsewhere, thus generating profit with minimal risk – known as arbitrage profit.

🔹 Types of arbitrage:

– Inter-exchange arbitrage: e.g. Bitcoin is cheaper on one exchange than on another.

– Triangular arbitrage: takes advantage of differences between exchange rates of three currencies (e.g. BTC/ETH, ETH/USDT, BTC/USDT).

– On-chain vs. off-chain arbitrage: differences between DeFi protocols and CEXs.

🔹 Advantages:

– Low risk (if execution is quick and efficient).

– Suitable for algorithmic and bot trading.

– Exploits market inefficiencies.

🔹 Disadvantages:

– Need for quick execution, as price differences quickly disappear.

– Transaction and withdrawal fees can eat into profits.

– Requirement for greater capital and technical infrastructure (e.g. API, bots).

On Binance, one can track the potential for arbitrage between spot markets, futures, or even different regions, but nowadays most arbitrage is performed automatically and profitable opportunities last only seconds.