The amount of time it takes depends on the type of arbitrage underway. There are three types of arbitrage: 1) International / Spatial market arbitrage, 2) Exchange market arbitrage & 3) Spot-Futures arbitrage.
1) International / Spatial market arbitrage
This type of arbitrage involves buying a cryptoasset like USDT, USDC, DAI, BTC, ETH using a traditional FIAT currency like USD, EUR or GPB and then selling it for FIAT in markets where the same type and quantity of asset trades at a premium, like ZAR, NGN or KRW.
Once the cryptoasset is sold for FIAT and a gain is realized, the capital is exported back to the original exchange in either USD, EURO or GBP, and the process is repeated.
It sounds simple, but the process of exporting capital from arbitrage markets is complex and requires a thorough understanding of local central banking law whilst also requiring established relationships with trusted banking partners and related intermediaries.
Crypto Arbitrage has the operational ability to complete these trades safely and compliantly through our network of subsidiary companies in each FIAT arbitrage market in which we operate; however, these trades do take some time to complete and therefore, it can take anywhere between 4 - 7 working days to conclude.
2) Inter-exchange arbitrage
Simply put, inter-exchange arbitrage is the process of searching for price differences for the same cryptoasset across different cryptoasset exchanges.
If you find a price difference opportunity, there is a time window to purchase the asset on exchange A at a lower price, and then send it to exchange B and then sell it there at a higher price, earning a return once completed.
Once the trade is finalized, the capital is converted to a stablecoin like USDT, USDC, or DAI, where it sits and waits for another inter-exchange opportunity to arise - which takes as long as it takes our proprietary software to identify a new arbitrage opportunity.
Unlike international/spatial arbitrage the exchange market is not converted into FIAT and then withdrawn through the traditional banking system. Capital remains on exchanges and is converted and moved between numerous exchanges as and when arbitrage opportunities present themselves, therefore, these trades typically take between 5 - 15 minutes to complete once initiated.
3) Spot-futures arbitrage
To profit from spot-future arbitrage opportunities Crypto Arbitrage holds a short position in the perpetual futures market while holding the same amount of position in the spot market. Arbitrage is achieved with a market-neutral position by receiving the funding rate every 8 hours on the short position held. Therefore, this type of arbitrage strategy can take anywhere from 8 hours - to multiple weeks to complete.