Trading platforms help crypto traders and even investors to keep track of the changes in crypto value. However, differences between prices offered on various cryptocurrency exchanges are often huge. For this reason, many tend to rely on arbitrage bots. Looking for a risk-free return on Cryptocurrency trading? Arbitrage is the way to go.
What is Arbitrage?
It is the process of simultaneously buying an asset at a low price and selling the same asset at a higher price, locking up the difference as profit. Warren Buffett, arguably the best investor in the world, has used arbitrage to generate average annualized rate of return of 81.28% from 1980 to 2003 with very low risk. The concept of arbitrage trading is not a new one and has existed in stock, bond and foreign exchange markets for many years.
How does Arbitraging in Cryptocurrency work?
Buy low, sell high – cryptocurrency arbitrage sounds easy in theory, but that isn’t always the case. Arbitrage is made possible by a difference in trading volumes between two separate markets. For instance, in a market with high trading volumes where there is reasonable liquidity of a particular coin, prices are generally cheaper. Meanwhile, in a market where there is limited supply of a particular coin, it will be more expensive. By purchasing from the former and instantaneously selling on the latter, traders can theoretically profit from the difference.
Why Jubilee Ace is the Best Trading Platform for Arbitraging
Arbitraging is made easy on Jubilee Ace trading platform. All possibilities are analysed before given a risk rating, and then the trade will be executed. What makes Jubilee Ace different from other trading platform is the use of triangular arbitrage and AQUA (Ace Quantum Universal Arbitrage) bot for automated trading to the exchange within split seconds to identify possible profit.
Cryptocurrency Arbitrage on Jubilee Ace Further Explained
Buying 1 LTC with BTC cost 0.012658 (Method 1)
Buying 1 LTC with BTC through ETH cost 0.012644 (0.0345*036649) (Method 2)
Since there is a spread between the two different trading methods (0.012658 - 0.012644)
We will buy 1 LTC with BTC through ETH and sell the 1 LTC to get back a higher value in BTC
*To note, we can trade the other way round if Method 2 has a higher BTC value
The AQUA bot, based on Python AI script runs 24/7 to collect price data from the crypto exchange of each triangular pairs. The data collected is then run through the AI for analysis and then a risk-arbitrage factor is given to the analysis. In the case of a positive factor, the bot automatically places trades using trade APIs within split seconds. This process will continue to repeat itself on other triangular pairs.
How to Make Profit From Arbitraging on Jubilee Ace