Flash Loan: Crypto Trading Arbitrage Strategy Without Capital

[Suba]

In the world of crypto DeFi, traders can borrow funds without collateral,
Flash loans are one of the most interesting innovations in the world of Decentralized Finance (DeFi). Flash loans allow traders to borrow crypto without having to provide collateral.

Arbitrage traders will get opportunities from two or more different crypto exchanges. For example, if the price of XX tokens on the local Indodax exchange has not increased or is lower than the price of XX tokens on the Binance exchange, then the trader takes a flash loan and buys XX tokens on Indodax and sells them on the Binance exchange and the trader will make a profit from the price difference without having to have capital.

 

[Stardom22]

In the world of crypto DeFi, traders can borrow funds without collateral,
Flash loans are one of the most interesting innovations in the world of Decentralized Finance (DeFi). Flash loans allow traders to borrow crypto without having to provide collateral.

Arbitrage traders will get opportunities from two or more different crypto exchanges. For example, if the price of XX tokens on the local Indodax exchange has not increased or is lower than the price of XX tokens on the Binance exchange, then the trader takes a flash loan and buys XX tokens on Indodax and sells them on the Binance exchange and the trader will make a profit from the price difference without having to have capital.

How profitable is that. I think that kind of trading has some limited profits for sure.

 

[Suba]

How profitable is that. I think that kind of trading has some limited profits for sure.

That's right, in doing crypto trading arbitrage, traders often only make small profits, but if done repeatedly it will be big. Moreover, if the trader knows the price of crypto will fall, he can immediately take a crypto flash loan and sell it, and he can pay off the crypto debt by buying crypto when the price drops.

 

[magnus2022]

One thing about arbitrage trading is that you will be glued to the system all day. Moreover, if you are not fast, the prices will drop or adjust. I think the risk and time don't worthy it.

 

[Suba]

In arbitrage strategy we don't have to be glued all day, because the moment of price difference does not happen all day, sometimes only at certain moments, exchanges and coins.