Bitcoin Traders Should Explore Foreign Exchange Arbitrage Opportunities

Arbitrage in the cryptocurrency world is nothing new under the  sun, as various exchanges seem to maintain different prices. However,  these gaps are usually a few dollars worth at best. That situation has  come to change, as trading Bitcoin or other cryptocurrencies against  particular fiat currencies may prove to be far more lucrative than  anticipated.  

FX Turmoil Opens Reverse Bitcoin Arbitrage Opportunities

When it comes to arbitraging Bitcoin  exchanges, traders will usually stick to the same fiat currency. For  example, one exchange trades 5-8 USD above or below the next, which  creates a gap waiting to be exploited. Events like these are not all  that uncommon, albeit less frequent than some people may like at this  point.  But just a week ago, a reserve scenario had taken place. The volatility across foreign exchange  markets is creating some interesting shifts very few people will take  advantage of. Bitcoin, due to its global appeal, can be traded against  nearly every fiat currency in the world. Given the volatile nature of  some of these currencies, such as the Yen, Real, and Ruble, new price  gaps emerge.
 

Although it takes some figuring out,  it is not hard to spot new golden opportunities for arbitrage. Every  fiat currency has a value denominated in US Dollar on the price charts.  However, this also means that selling Bitcoin for local currency can be  converted to a USD price. In some cases, there can be significant gaps  between buying Bitcoin with one currency and selling it against the  next. Figuring out the price correlation between fiat currency values for Bitcoin -in  USD – and the profit to be made – in USD – can lead to some healthy  gains. Do keep in mind these arbitrage opportunities usually occur in  smaller markets, and orders will not always be filled instantly. In some  cases, it may take days, or even weeks, to see a buy or sell order  filled. 

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