On May 26, 2020, Bitbengrab launched a tool meant to help traders capitalize on manual or automatic arbitrage trading in up to 29 established cryptocurrency exchanges. Arbitrage trading is a popular way of making profit through price differences offered by two different markets.
Experienced traders are constantly seeking opportunities to tap into the highly volatile crypto market. Most cryptocurrencies often experience a similar volatility swing as Bitcoin, which averages on 10% or more per day.
Crypto derivatives are gaining popularity as the predictability based on mass psychology is much higher than traditional stocks that have more fundamentals to consider. With the crypto industry still immature, different crypto exchanges are slow to changing market prices in comparison to traditional stocks that have been in the market for over a century.
In economics and finance, arbitrage is simply the practice of taking advantage of the difference in prices between two or more markets. Essentially, it is seen as a risk-free investment made during transactions, hence there is no chance of negative cash flow.
However, at times to make considerable profits from arbitrage trading, the speed has to be fast enough to execute orders as they come in. With small profits, it could spell problems for the trader as the transaction cost could wipe out the profits made, only to end up in a zero-sum game.
Bitbengrab Arbitrage Trading Services
With the significant difference in crypto prices in different markets, a well-structured system utilizing API to connect on the markets is the answer in making profits. This is where the new service offered by Bitbengrab comes in.
According to the press release to different media outlets, Bitbengrab uses libraries to connect to multiple exchanges as a result able to fetch data and order books at exact intervals. It is after collecting the data that the system analyzes in a split second in order to locate the price difference.
With the results displayed, the users can then execute the trades as desired manually. However, Bitbengrab is promising the users that they can use the API keys to connect their exchanges and its system to automatically execute trades.
The company will offer automatic arbitrage trading from 29 different exchanges including Bittrex, Bitfinex, and also Binance. For traders to open maximum limits in arbitrage automatic trades, they are first recommended to verify with KYC at the exchanges, and then give Bitbengrab API permissions for balance and trading.
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