What Inter-Arb is
Inter-Arb exploits a price gap for the same asset between two exchanges: buy where it's cheaper, sell where it's dearer, and keep the difference after fees on both sides. It holds inventory on both venues — there are no automatic transfers between them, so you pre-position balances on each.
Key parameters
- •The two exchanges & the asset — where you hold inventory to trade against the gap.
- •The spread must clear both venues' fees (and slippage) to be worth taking.
When to use it
- •Persistent, tradeable price gaps between two venues where you already keep balances.
When NOT to use it
- •Thin liquidity — the gap collapses as your order fills — or when fees and latency eat the difference.
The pitfall
The gap is usually small and fleeting. Fees on both sides, slippage, and the need to keep inventory pre-positioned on each exchange (no auto-transfer to rebalance) mean the real edge is thinner than the quoted spread. Model the full cost honestly before assuming a profit — and never enable withdrawal on the API keys.