Bitsgap is an all-in-one trading automation platform for bitcoin and other cryptocurrencies.
Bitsgap provides you with everything you need to easily manage your assets within one interface, such as crypto trading bots, smart algorithm orders, portfolios, and even demo trading.
In this article, emphasis is going to be placed on how you can make quick arbitrage profits using the Bitsgap trading platform, if at all that is possible.
• Making arbitrage profits is not an overnight activity, as it will require you to be well experienced and knowledgeable about price patterns if you want to make profits with the platform.
• Bitsgap provides lightning-quick execution of arbitrage transactions, which ensures that they are always successful and that you receive your profits.
• Rebalancing after crypto-fiat arbitrage is more time-consuming and would require you to follow more procedures than rebalancing after crypto-to-crypto arbitrage.
• Bitsgap continues to dominate as one of the best all-in-one platforms for arbitrage trading and other forms of crypto-related activities.
A Quick Explanation of Arbitrage Profit
Arbitrage profits are the proceeds generated from buying a particular crypto asset on one exchange and selling it simultaneously on another where the price is higher.
So basically, what you are trying to do is to exploit the market to maximize to the fullest certain price loopholes that exist between exchanges, making a profit from that in the process.
Speaking of Bitsgap and how it can help you make this arbitrage profit, the platform has stated that, unlike other trading platforms, it does not have a magic button that will automatically generate for you quick arbitrage profits.
Instead, you would need to be well experienced and mindful, perfectly understanding the system and patterns if you truly want to make profits from crypto arbitrage trading.
The role of Bitsgap arbitrage is simply to offer you the most complete information possible on price differences available in the crypto market and the working tool. After this, it is up to you to make the most of them and ensure you make returns in the process.
To make things easier to understand, I will be moving on to explain how arbitrage works on Bitsgap so you have an in-depth understanding of what to expect when you want to carry out arbitrage trading and make arbitrage profits on the platform.
How Does Arbitrage Work on Bitsgap?
Just like I explained earlier, arbitrage is simply the process of buying crypto assets at a lower price and selling them at a higher price (buy low and sell high).
This is the standard process for any arbitrage transaction we are all used to, but one major weakness with this process is that in the process of trying to sell high after buying low on another exchange, the transaction speed may take from a minute to as much as three hours.
Knowing how volatile the crypto market is, that is more than enough time for the expected profit to drop drastically or completely disappear because of the time wasted in the transaction.
Now, it is at this point that Bitsgap comes in, as it solves this problem by processing arbitrage transactions at lightning-fast execution with the availability of the necessary volumes, meaning that you get to successfully carry out your arbitrage transactions and make your arbitrage profit quickly before the price changes.
For example, let’s say that you are making a transaction through the BTC/USDT pair with a volume of 0.1 BTC on Kraken from Bitfinex.
You already have the USDT needed to buy 0.1 BTC at a lower price on Kraken and also have 0.1 BTC on Bitfinex, for which it will be sold in USDT at a higher rate.
This means that there is no need to wait until the bitcoin from Kraken reaches Bitfinex because you already have the necessary volume. It means that you can make the transaction, rebalance the funds, and repeat the transaction.
After clicking on the Trade button, Bitsgap will send 2 limit orders:
- A BTC buy-order for USDT will be sent to Kraken.
- A BTC sell-order in USDT will be sent to Bitfinex.
After this is done, the transaction becomes completed and, in most cases, successful, and you will be able to see your transaction history in the History section.
Rebalancing after the crypto-to-crypto arbitrage
Once your transaction is completed, you will need to rebalance your balance to repeat the transaction. You will have to do this by yourself as Bitsgap does not assume the responsibility of carrying out automatic rebalancing for you.
This is done this way to keep your funds safe and secure. So, to rebalance your account, you will need to:
- Transfer USDT received from the BTC sale from Bitfinex to Kraken.
- Transfer BTC received from the purchase of USDT from Kraken to Bitfinex.
Rebalancing after crypto-fiat arbitrage
Unlike the previous type of rebalancing, which involves crypto-to-crypto arbitrage, this type of rebalancing can be time-consuming as you would need to transfer fiat currency to a bank account from the exchange.
To do this, you will have to
- Transfer the cryptocurrency purchased with fiat from the buying exchange to the selling exchange.
- To transfer the money received from the arbitrage trade from the exchange to the bank account. This process takes 1–5 days, and different exchanges can charge a commission ranging from $10 to $60, which you need to take into account in calculating the final profit.
- Once the money has been credited to your bank account, you can transfer it to a buying exchange for a repeat arbitrage trade.
Given that arbitrage with fiat trading pairs turns an average profit of 2-2.5%, and that exchanges can charge $60 for money transfers to the bank, Bitsgap recommends that you use a minimum of $10,000 to work with this type of arbitrage.
With this amount, you will receive approximately $150-250 per arbitrage cycle.
Frequently Asked Questions (FAQs)
Does Bitgap take a commission on trades?
No, Bitsgap does not charge any trading or other hidden fees and simply has no technical way of doing it. To use the Bitsgap service, you just need to activate any of their paid subscription plans.
Does Bitsgap have access to my exchange wallet?
No, Bitsgap does not have an option to access your exchange wallet and make any changes there. Your funds will always stay in your exchange account.
Bitsgap is an excellent trading platform where you can carry out all manner of trades. Bear in mind, however, that carrying out arbitrage trading to make profits is not an overnight process.
You will need to be well experienced and study the patterns of prices to be very successful at it.
The information contained in this article was gotten from Bitsgap Blog.
Crypto Tools: Essential Resources for Crypto Traders
Crypto tools are essential for anyone looking to navigate the complex world of cryptocurrency. With the rise of digital assets, it is becoming increasingly important to understand the various tools available for trading, analyzing, and securing your digital assets. From market indicators to crypto exchanges, these tools can help investors make informed decisions and maximize ...
CFD Forex Calculator: A Comprehensive Guide with Practical Examples
In the current fast-paced financial world, the foreign exchange (Forex) market has become one of the largest and most liquid markets globally. With the advent of online trading platforms and the increasing popularity of Contract for Difference (CFD) trading, retail traders now have the opportunity to speculate on currency price movements and potentially profit from ...
Understanding And Navigating Decentralized Exchanges (Dex)
A DEX is based on the concept of “disintermediation,” it refers to omitting mediators and enabling everyday people to transact businesses freely with their counterparts. A DEX does not guarantee the maintenance of users’ crypto assets. On the other hand, users always precisely control their funds in their digital wallets. Read on as we take ...