
Show HN: Token Spread – Bitcoin/crypto spread tracking for arbitrage - wbelk
https://www.tokenspread.com/
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donpdonp
This is a nicely designed site and some good data feeds. There is a big
difference between spread, and arbitrage. Critically, any attempt to track
arbitage needs to watch the orderbook rather than the last-trade-price.
Ironically, the bid/ask spread on the same exchange isnt part of arbitrage.
The difference between the total available bids on exchange A and the total
available asks on exchange B (or vice-versa), is the opportunity.

I wrote and ran an arbitrage tracking site for a few years and eventually
stopped because there did not seem to be viable way to take advantage of
cross-exchange spreads. Sell-Move-Buy didn't work because moving coins took
days. Having a pile of each kind of coin on each change is fast but defeats
the point of arbitrage because the pile itself it subject to the price changes
that arbitrage is made to avoid.

The chart below shows the result of looking at the orderbook of different BTC
exchanges, seeing how much was actually offered at a winning price on other
changes, computing the total, and taking into account exchange fees (more or
less)

At 10:10pm there is a $16USD spike - probably between BTC-E and Gemini that
lasted a short while (refresh rate was every 10 min)
[https://web.archive.org/web/20160219100013/http://cointhink....](https://web.archive.org/web/20160219100013/http://cointhink.com/arbitrage/btc:usd)

I always thought the code could be generalized enough to look at any number of
exchanges and coinpairs. I'll keep an eye on tokenspread, it looks like a good
start!

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squashmode
Agreed. I had run a small BTC arb program for a bit a number of years back.
The exchanges were shoddy, there was a persistent bias in the arbitrage such
that you ended up accumulating huge positions of BTC on one side, and lots of
short cash on the other. Couple that with the difficulties of withdrawing cash
from the system, fees, etc., it was not worth the risk. But this is not new.

What's pretty cool about this -- though it appears this site is not focused on
it -- is the opportunity for full triangle arbitrages among the various
crypto's, such that you may do, e.g., a BTC->ETH->LTC->BTC trade and wind up
with more BTC than you started with.

Another point to consider; the big players have moved into this space, if you
want to get into it you will need to be sure you're not at an informational
disadvantage.

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olegkikin
I created a script years ago that looked for arbitrage opportunities on BTC-E,
up to 4 trades deep, and it used the order books properly. I left it running,
and was surprised that it actually found some arbitrage opportunities, around
once every 3-4 minutes. Unfortunately the profits were always lower than 3-4
transaction fees of 0.2% each, so my dreams of getting rich quick got crushed.

I'm was actually surprised BTC-E didn't do something like that themselves,
since the they don't have to pay any transaction fees, and they also had zero
lag. It's like free money.

~~~
mhluongo
They almost certainly did. Crypto exchanges will give market makers and arb
shops deals on exchange rates.

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jatsign
Crypto arbitrage always seems so tempting, but there's so many gotchas. This
site seems to do a good job of weeding out some of the gotchas by focusing on
coins with high market caps.

Usually the "opportunities" in arbitrage that sites like this highlight ignore
the fact that the targetted coin on one of the exchanges has abysmally low
volume, so you'll be unlikely to be able to buy and sell it in time to take
advantage.

Other gotchas include: time to transfer the coin between exchanges, fees
involved (both in transfer and on the exchanges through buy/sell fees), and
exchanges where deposits and withdrawals aren't fully automated (some Chinese
exchanges were like this).

~~~
runeks
> Usually the "opportunities" in arbitrage that sites like this highlight
> ignore the fact that the targetted coin on one of the exchanges has
> abysmally low volume, so you'll be unlikely to be able to buy and sell it in
> time to take advantage.

I don't understand. If there's an order in the order book on the sell-side of
one exchange that matches one on the buy-side of another exchange, what does
volume on either exchange have to do with the ability to take advantage of
this situation?

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polskibus
That order can disappear in between. The probability of such event is not
zero.

~~~
runeks
How does exchange volume affect the risk of this occurring?

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polskibus
The more liquidity there is, the higher the chance that someone will jump in
the place of another order that has been withdrawn. Low liquidity and volume
means that such chance is lower.

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DINKDINK
An alternative site, if you prefer to see it in matrix form

[https://data.bitcoinity.org/markets/arbitrage/USD](https://data.bitcoinity.org/markets/arbitrage/USD)

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nnfy
Given the efficiency of information exchange over the internet regarding btc
prices on numerous exchanges, I'd venture to guess that these arbitrages only
exist because of market barriers that average investors cannot efficiently
surmount.

Example: a few years ago there was a difference of a few hundred dollars
between U.S. and Chinese exchanges. But you couldn't really trade on the
Chinese exchange unless you were or knew someone who was a Chinese citizen.

I haven't researched it, but my impression is that arbitrage is only
indicative of market inneficiency. And a corrolary is that by the time you get
into a position to take advantage of significant arbitrage, someone will
likely have beaten you to it.

In other words, efficiency is antithetical to arbitrage. I welcome alternative
perspectives.

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brianpgordon
A hundred-dollar bill is lying on the ground. An economist walks past it. A
friend asks: "Didn't you see the money there?" The economist replies: "I
thought I saw something, but I must've imagined it. If there had been $100 on
the ground, someone would've picked it up."

There were public order books years ago and there were still arb opportunities
because the field was niche and people just hadn't written the software yet.
In terms of your comment, the technical barrier was what "average investors
cannot efficiently surmount." At this point the high-volume pairs are too
crowded but I suspect that there are still opportunities to make money where
technical complexity is still high (e.g. smart contracts).

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wc-
Pretty cool site, thanks for showing it. Are you plugged into each exchange's
API or using an aggregator?

Taker fees should be shown on all of these potential cross exchange arbs.
Exchange withdrawal fees should be presented somewhere as well.

For those looking at this site and seeing the percentages and thinking it's
easy money, it isn't. Arbing has become a pretty crowded space and this kind
of low hanging fruit is very hard to capture even when fully automated, not to
mention the banking logistical issues of using USD (not tether) as a base
pair.

If building trading systems in the crypto world is something that interests
you feel free to reach out to me, company / contact info is in my profile.

~~~
wbl
You don't need to be a taker to run arb. You'll be able to push the spread on
a side of each exchange, and work with quantities of BTC on each one that get
replenished.

~~~
wc-
Ok sure, show both then, the maker rebate on some exchanges will open up more
opportunities.

All I want is just one "arb opportunity dashboard" to show the whole picture
so people don't think they can deposit some btc and start clicking away
generating a profit...

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ovx99
Anyone here messed around with sentiment analysis tools/bots for crypto?

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tibbon
I've seen a few. They largely seem to be a trailing indicator, not a
predictive one.

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hidiegomariani
good job! what's the tech stack behind this?

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wbelk
mostly Node and some other bits. thanks for the support!

