What is crypto arbitrage?
A plain-English guide to crypto arbitrage: what it is, why the same token trades at different prices across exchanges and networks, and how spreads are measured in basis points.
6 min read
Crypto arbitrage is one of the oldest ideas in finance applied to digital assets: buy something where it is priced low and sell it where it is priced higher, pocketing the difference. In traditional markets these gaps are tiny and disappear in milliseconds. In crypto they are larger and more frequent, because the same token trades simultaneously across hundreds of venues that do not share a single order book.
Why does the same coin have different prices?
A token like ETH or USDC is not listed in one place. It trades on decentralised exchanges (DEXs) across Ethereum, Base, Arbitrum, Solana and dozens of other networks, and on centralised exchanges (CEXs) such as Binance, Coinbase, Kraken and OKX. Each venue forms its own price from its own supply and demand. When buying pressure hits one exchange but not another, prices drift apart — and a spread opens.
- Fragmented liquidity: every network and exchange has its own pool of buyers and sellers.
- Slow information flow: bridges, withdrawals and settlement times stop prices snapping back instantly.
- Fees and friction: it costs gas and time to move funds, so small gaps persist instead of being arbitraged away.
How spreads are measured
A spread is the percentage difference between the cheapest place to buy and the dearest place to sell, expressed in basis points. One basis point (bps) equals 0.01%, so a 50 bps spread means the sell price is 0.5% higher than the buy price. WAGMI shows the spread for every venue relative to the cheapest, and flags any spread above the minimum you choose.
A simple example
The two main types
Cross-exchange arbitrage
The same asset is priced differently on two exchanges — for example ETH cheaper on one CEX than another. You buy on the cheap exchange and sell on the expensive one.
Cross-network arbitrage
The same asset is priced differently on two blockchains — for example USDC on Base versus USDC on Arbitrum. Here the move usually involves bridging or routing between networks.
We compare these head-to-head in cross-network vs cross-exchange arbitrage.
What makes it hard — and where WAGMI helps
The challenge isn't the idea, it's the legwork: monitoring hundreds of prices in real time, doing the maths on fees, and acting before the gap closes. WAGMI's spread scanner prices a single asset across 30+ networks using on-chain quotes in one click, ranks them cheapest to dearest, and can email you when a spread beats your threshold — so you only act when it's worth it. And because WAGMI is self-custodial, the funds you trade never leave your control. Prefer it fully hands-off? Fund an Autopilot account and WAGMI scans and executes profitable arbitrages for you automatically — same self-custody, no monitoring.
Key takeaways
- Arbitrage is buying an asset where it is cheap and selling where it is dearer to capture the gap.
- The same token trades on many networks and exchanges that rarely agree on price.
- Spreads are quoted in basis points (1 bps = 0.01%) and are usually short-lived.
- Real profit depends on fees, slippage and how fast you can move funds between venues.
FAQs
Is crypto arbitrage legal?+
Yes. Buying low on one venue and selling higher on another is a standard market activity that helps prices converge. Always follow the terms of the exchanges you use and your local tax rules.
How much money do you need to start?+
There's no fixed minimum, but small trades are often eaten by network and exchange fees. Scanning first — as WAGMI lets you do for free — shows whether a spread is large enough to cover costs before you commit capital.
Ready to find your first spread?
Scan live prices across on-chain networks and DEXs.
Keep reading
Cross-Network vs Cross-Exchange Arbitrage
The two main kinds of crypto arbitrage compared: price gaps for the same asset across blockchain networks (DEX) versus across centralised exchanges (CEX), and how to act on each.
Read guideArbitrageStablecoin Arbitrage: USDC & USDT Spreads
How stablecoins like USDC and USDT drift from $1 and from each other across networks and exchanges, why these spreads appear, and how to scan for low-volatility stablecoin arbitrage.
Read guideGuidesHow to Set Up Crypto Arbitrage With WAGMI
Step-by-step: scan cross-network and cross-exchange spreads with WAGMI's spread scanner, set a minimum spread and amount, configure email alerts, and execute swaps in self-custody — or fund an Autopilot account that scans and executes profitable arbitrages for you automatically.
Read guide