Arbitrage opportunities in the cryptocurrency markets are at an all-time high right now, with thousands of currencies and hundreds of exchanges available. Throughout 2021, data from Cryptorank showcases that the price of Bitcoin fluctuated between $28,383 and $65,000, making its annualized volatility rate 81% and its daily volatility rate 4%.
And there is so much more to come. Globe News Wire proacts that by 2028 the value of the online trading sector is projected to reach over $12 billion, and AI will be a key contributor to this expansion.
AI and automated trading in arbitrage is a boon for those new to the trading arena. The entry barrier for profitable trading is significantly lowered, as you do not require advanced trading skills or in-depth market knowledge. Once set with the right parameters, the automated system can begin trading, learning, and adapting to market trends, making it an accessible avenue for passive income generation.
What is Arbitrage Trading?
Any investor worth their salt knows that arbitrage trading is one of the most promising building blocks. Arbitrage takes advantage of transitory fluctuations in the prices of identical or comparable financial instruments across markets or other formats. In other words, arbitrage results from market inefficiency, which it exploits and corrects.
Broadly speaking, two methods to pinpoint crypto arbitrage possibilities are manual analysis and automated scanning.
Manual Trading – At first glance, one might consider utilizing human computation to discover these opportunities. However, the prospect of manually sifting through all this data quickly becomes overwhelming and impractical when factoring in the sheer volume of exchanges and the plethora of cryptocurrency pairings. In short – this is slow, tiring and time-consuming.
Automated Trading – Given the impracticality of manual calculations, the most effective and efficient approach to identifying crypto arbitrage opportunities lies in automation. Automated trading algorithms and tools are designed to sift through vast amounts of data at lightning speed, monitoring multiple exchanges and cryptocurrency pairings simultaneously. The result? These algorithms can detect even the slightest price discrepancies and execute trades in real time, a feat unattainable by human computation. Using AI, Forbes indicates that accessing and utilizing 90% of previously inaccessible relevant data is possible.
Uncovering Benefits of AI Arbitrage Trading
AI arbitrage trading can open up new possibilities, regardless of whether you are a seasoned trader or just starting out in the crypto industry.
Fast & Safe – Successful arbitrage deals may be executed quickly and reliably with the help of an intelligent AI platform immune to human mistakes or interference. In some instances, AI turns a profit by swiftly and efficiently filling a pricing void unaffected by market factors.
Low Risks – Arbitrage trades are highly risk-free because of the simultaneous reselling that is done to capitalize on price changes. The purpose of initiating the transaction is to earn a certain profit from multiple assets. The risk for price changes is mitigated even in volatile crypto markets, with a transaction taking a few minutes, providing there are no delays.
Multiple Opportunities – Many digital currencies may be traded on most exchange platforms, thus, there are, therefore, a multitude of opportunities for arbitrage that others may ignore.
Less Competition – Traditional financial markets make arbitrage trading almost impossible for retail investors. Current hedge funds and other institution organizations use a plethora of high-tech, AI-powered trading bots that can spot and act on arbitrage possibilities in a matter of seconds. As a counterpoint, institutional investors are putting less money into altcoins.
Exploring Arbitrage Trading Opportunities for Passive Trading
Todd M. Fleming once said, “The greater the passive income you can build, the freer you will become.” Today, AI-driven arbitrage trading represents an exciting frontier for investors seeking to build wealth passively. Automated trading systems save investors time by handling routine monitoring, decision-making, and trade execution tasks. There’s no longer a need to monitor the market round-the-clock or study intricate charts. Once the system is in place, it works nonstop, perhaps generating income while the investor is sound asleep.
Finodi’s crypto trading bot is supported by an intelligent and dependable AI which employs cutting-edge algorithms to track market movements and place trades only when a certain profit threshold is reached. More than 3.7 million users from more than 170 countries may trade over 50 different cryptocurrencies with Finodi.
How to Generate Passive Income with Finodi
- Registration or Authentication: Start your Finodi journey by registering a new account. Our streamlined sign-up process ensures swift and secure registration while returning users can conveniently authenticate with their established credentials.
- Capital Allocation: Next, deposit your chosen amount of USDT, aligned with the desired trading package. Once the deposit is confirmed, our advanced system will automatically select the specified package and commence trading operations on your behalf.
- Automated Trading Initiation: Upon successful funding, our state-of-the-art trading bot springs into action. Utilizing advanced algorithms, it diligently scans for lucrative arbitrage opportunities across various exchanges.