The Arbitrage Bot will compare the prices of an asset pair on two different exchanges over the course of a set period of time. When the bot has an opportunity, it will try to sell one asset at a higher price on one exchange while also buying it at a lower price on the other exchange, thus placing two orders simultaneously, buying and selling. It will also continue to look for opportunities to buy or sell at a profit relative to previously executed orders.
The Bot does not transfer funds between the two exchanges. Instead, it requires having a minimum trade balance for both assets on both exchanges since it is impossible to determine in advance which exchange will have the lower or higher price. Be sure you have enough of each coin to execute trades successfully.
Unlike a traditional arbitrage bot oriented on the market price, the CryptX Terminal Arbitrage Bot will act based on the Order Book, evaluating all published orders and determining at what price an order should be placed. In addition, the Bot uses Limit Orders to execute trades at the target price.
A Rebalance Trigger can also be activated, which allows the Bot to restore the previous balance if the current balance goes lower than the chosen trigger point. A Rebalance Order is a type of Limit Order that executes on the rebalance trigger at the lowest possible price.
First, indicate the two exchange accounts where the trading should take place, in this case, HitBTC (1) and Binance (2). Select a pair that has funds on both sides and on both accounts, such as BTC-USDT. The bot will display how much of each asset is available on HitBTC and Binance, for each of the 4 wallets (BTC/1, USDT/1, BTC/2, USDT/2).
Let's set the Minimum and Maximum sizes for trade orders at 0.0007 BTC and 0.001 BTC, respectively, keeping in mind how much of each asset we have to work with. We will allow the bot to trade a total amount of 0.1 BTC within 10 trades, on each exchange. We also need to select a date for the bot to end trading if neither of the previous limits are met.
The bot knows that HitBTC has a commission fee of 0.09%, while Binance’s fee is 0.1%. We want a profit of at least 0.11% from each trade, thus the Arbitrage Trigger is automatically calculated at .3%, which will be the minimum spread between market prices.
Save the configuration and start the Bot. It will now search for the best price and amount that can be fulfilled on the Order Books, based on the indicated amounts, from 0.0007 to 0.001 BTC. If the best rate is .3% more on one exchange than on the other (taking into account the commission rates of the exchanges and the profit rate indicated in the parameters), the bot will place orders simultaneously on both exchanges.
For instance, BTC is selling on Binance at $34581, while on HitBTC there are BTC buy orders for $34716. The bot places an order to buy within the configured amount on Binance, and another order on HitBTC to sell the same amount.
In some cases, only one order can be executed. The matching order will fail if the account's current balance is not high enough to support the order. The bot will continue to watch for opportunities to achieve a profitable return based on the first order that was executed. This could also happen on the same exchange at a later time. For example, several hours later Binance is now selling BTC at $35700. The bot places an order to sell and a profit is made.
How to configure the Arbitrage Bot
You will need to provide the following settings:
- A Name for the Bot
- Two exchange accounts: Exchange #1 & Exchange #2 (in any order)
- Asset pair (the first coin will be the quote currency)
- Minimum Trade and Maximum Trade Amounts (order sizes - be sure to check the minimum required trade amounts set by each exchange before you configure your bot)
- Total Amount to trade
- Maximum number of orders the Bot can place
- End date
- Fees for Exchange #1 and Exchange #2. The Bot will try to determine the commission rate between the two exchanges based on previous trades, but the numbers are also adjustable
- Desired percentage of profit per trade
- Rebalancing Trigger (optional): this allows the Bot to return to the previous balance if the percentage of the original amount goes below the trigger
Give your bot a unique name.
Account 1 & Account 2
Indicate the first and second exchange accounts where this bot will run.
You will see only exchanges that you have linked with our system.
See instructions for connecting to external exchanges.
Select the currency pair this bot will trade with. Make sure you have enough of each currency to execute trades.
Min. Order Size
Indicate the smallest trade amount you want per transaction.
Max. Order Size
Indicate the largest trade amount you want per transaction.
Indicate the total amount of quote currency the bot can trade per exchange. Once it trades this amount on one exchange it will stop.
Indicate the total number of trades the bot will make per exchange. Once it reaches this number on one exchange it will stop.
Indicate a date when the bot will stop trading.
Enter your desired profit percentage. The Arbitrage Trigger is automatically calculated based on the known fees of the exchanges you selected above, or you can modify the fees if necessary.
Indicate what percentage of loss in either currency will trigger rebalancing, if desired. Keeping both assets even will improve results.
Running Your Bot
Once you have configured the bot, click Save Bot. If there are any errors, correct them and save the bot again.
When your bot is ready, click Start Bot.
You can monitor your bot's status from the Dashboard. If at any time you want to adjust the bot's configuration, stop the bot first, then click the Edit button.