The crypto arbitrage technique allows traders to profit from the price discrepancies existing in the prices of a cryptocurrency over different exchanges. The Arbitrage Tool at Torex manually functions and analyzes the liquidity existing in the order books throughout the supported crypto exchanges: Binance, Bitfinex, Bittrex, BKEX, CREX24, Coinsbit, Huobi, Poloniex, and KuCoin. More exchanges are considered to be added in the future.
Traders who have multiple accounts on multiple exchanges, that are supported by Torex, can link them via API to Torex and perform manual crypto arbitrage transactions in the Torex Trade section.
Traders can perform an inter-exchange arbitrage transaction in case they weighed possible risks, took into consideration the associated commissions that will be taken by the exchanges, and came to a conclusion that it suits their trading goals.
Utilizing Crypto Arbitrage Tool at Torex
Searching crypto arbitrage windows with the Torex trading platform follows an advanced mechanism that is guided and described in the following detailed steps.
Since crypto arbitrage measures the irregularities existing among the exchanges over the same crypto assets, you need to select at least two exchanges to utilize the tool properly.
The slider under the option of “Filter orders on minimum daily volume” sets up a BTC equivalent value. Along with that, you can manually enter the amount in digits. This option supports the trader to exclude such orders during the operation that have minimal trading volumes and low liquidity, thus limiting the trader’s profit.
The trader can set the next slider showing a percentage with “Expected profit”. You can alternatively mention the amount in digits in the box present below the slider. This allows you to exempt the currency pairs with the minimum percentage set for the profit being expected. The “Expected profit” value does not include any commissions that are charged by exchanges over transactions including buying/selling or depositing/withdrawing crypto assets. As an example, depending on the market situation, traders can consider setting the expected profit value to 0.7 – 2.0% for finding crypto arbitrage windows.
An optional checkbox depicts the option of “Consider minimum order volume.” This sets the desired arbitrage volume in BTC for searching liquidity among exchanges’ order books and currency pairs in the market. The digital market can show very high fluctuations. From time to time it occurs that the Torex Arbitrage Tool is unable to provide you with high “Expected profit” arbitrage windows due to market conditions. As an example, depending on the market situation, traders can consider setting the trading volume value by 0.5 – 1 BTC for finding crypto arbitrage windows.
Tap on the “Analyze” button to search for crypto arbitrage windows based on your previously entered settings. The search can have two possible outcomes: 1) arbitrage windows are found and displayed in the results of the screen; 2) arbitrage windows are not found.
1) In case the crypto arbitrage windows are found, a trader can consider making an manual crypto arbitrage transaction: buy a crypto asset on one exchange and sell on another. This can be considered when the trader has conserved a balance on the exchange for executing an arbitrage transaction. However, it should be kept in mind that the crypto window that is available shows a potential risk of influencing the profitability or the necessity of fulfillment of the transaction due to the rapid fluctuations of the prices within the exchanges.
2) With no specific windows available for the set value, the screen displays the prompt message of “No suitable deals for the moment”. In that case traders can amend their previous settings. For example, if that suits a trader’s goals, additional crypto exchanges can be added to the search or “minimum daily volume”, “expected profit” and “minimum order volume” values can be lowered.