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Author: Admin | 2025-04-28
Markets in developing DeFi ecosystems such as Cosmos, as market participants may be less efficient. For example, the ATOM borrow APR on Umee, a Cosmos' money market is around 4.65%, whereas the ATOM lending APR on Nitron, also a Cosmos’ money market is around 7.11%, presenting an interest rate arbitrage between the two assets.Image taken from: UmeeImage taken from Nitron, DemexNote: These are examples; CoinGecko is not endorsing these protocols or recommending this particular interest rate arbitrage. Please perform due diligence before performing any arbitrage.Bot ArbitrageArbitrage trading can take a lot of time because you have to compare prices on different exchanges. On top of that, price differences are usually gone by the time you attempt to manually arbitrage them. But if you use a bot program, your bots can find arbitrage opportunities and do the work for you faster than you can physically.We’ll discuss the bot arbitrage strategy and its profitability in more detail shortly.Statistical ArbitrageBots use statistical arbitrage, but some traders with a background in designing or reading mathematical models may choose a personalized, statistical approach to arbitrage trading. Python is a popular tool for algorithmic arbitrage trading.Doing so opens the potential opportunity for more arbitrage trades. However, this skill takes time, which is why many people rely on bots.Triangular ArbitrageTriangular arbitrage involves buying and selling three or more cryptocurrencies for profit without having to leave an exchange. Such a method is ideal for people with limited cryptocurrency exchange choices due to their country of residence.The basic idea behind triangular arbitrage is to convert one crypto to another, then to a third, before converting back to the original crypto. If the exchange rates between the different crypto pairs are not proportional, there may be an opportunity to make a profit.An example of triangular arbitrage in crypto is buying
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