Reference
Crypto arbitrage glossary
The terms traders actually use, defined without the hype. Each entry says what it means for real fills, not headline spreads.
A quick reference for the words behind cross-exchange trading. If you are new to the whole idea, start with the crypto arbitrage guide. The theme throughout: a spread is only worth anything once it survives fees, slippage and an open transfer rail.
Core arbitrage types
The main shapes a spread can take.
- Spatial (cross-exchange) arbitrage
- Buying an asset where it is cheaper and selling where it is dearer at the same moment. The umbrella term for any price gap between two venues. Spot-spot →
- Spot-spot (CEX-CEX)
- The same coin trading at two different prices on two centralised exchanges. You buy on the cheap venue, move the coin over an open network, and sell on the expensive one. Spot arbitrage guide →
- Spot-futures (cash-and-carry)
- Holding the spot asset and shorting its perpetual at the same size, so you pocket the basis instead of betting on price. A delta-neutral trade that earns the gap between spot and futures. Spot-futures →
- Funding-rate arbitrage
- Collecting the funding paid on a perpetual by holding an offsetting spot position, so price moves cancel out and the funding stream is the profit. Works while funding stays on your side. Funding arbitrage →
- CEX-DEX arbitrage
- A price gap between a centralised exchange and an on-chain pool. One leg is a normal order, the other is a swap on a DEX, with gas and pool depth deciding whether the gap is real. CEX-DEX →
- Cross-chain (DEX-DEX) arbitrage
- The same token priced differently across two chains or two on-chain pools. Both legs are swaps, and a bridge or native transfer connects them, so bridge time and cost are part of the math. DEX-DEX →
Specialised strategies
Narrower plays with their own timing and risk.
- Triangular arbitrage
- Cycling through three pairs on one exchange - for example USDT to BTC to ETH back to USDT - to exploit a pricing mismatch between them. No transfer needed since it stays on a single venue. Triangular →
- New-listing arbitrage
- Trading the wide, messy spread that appears when a coin lists on a new exchange before its price settles across venues. Fast and thin, so deposits and withdrawals are often the bottleneck. New-listing guide →
- Latency arbitrage
- Acting on a price change on one venue microseconds before another venue updates. An infrastructure race that mostly belongs to co-located bots, not manual traders. Latency guide →
- On-chain dumps (flash-crash)
- A sudden on-chain sell that briefly crashes a token in one pool, opening a gap against calmer venues. The window is short and the print can be a wick, so executability matters most here. DEX-Dumps →
- P2P arbitrage
- Buying or selling crypto on a peer-to-peer marketplace where local payment rails and demand push the price away from the exchange rate. Counterparty and payment risk replace transfer risk. P2P guide →
- Pre-IPO / tokenised-equity arbitrage
- A gap between a tokenised share of a private company and its implied or eventual market value. Pricing is thin and the token is a claim on the equity, not the equity itself. Pre-IPO guide →
Mechanics & execution
How a trade is actually put on.
- Leg
- One side of an arbitrage trade. A cross-exchange play has a buy leg and a sell leg, and the spread only closes when both fill.
- Route (bundle)
- The full set of legs and transfers that turn a spread into a realised trade, treated as one plan. Finder shows the route so you can see every step before you commit.
- Delta-neutral
- A position built so that price moving up or down does not change your net exposure, because a long leg offsets a short leg. The profit comes from basis or funding, not direction. Funding arbitrage →
- Maker / taker
- A maker order rests in the book and adds liquidity, a taker order hits an existing order and removes it. Taker fills are instant but usually cost a higher fee.
- Slippage
- The difference between the price you expected and the price you got, because your order ate into the book. Larger size and thinner books mean more slippage.
- VWAP (volume-weighted average price)
- The average fill price across all the order-book levels your trade consumes, weighted by the size at each level. The honest price for a given size, not just the top of book.
Costs & the math
What eats into a headline spread.
- Taker fee
- The commission an exchange charges when you remove liquidity with a market or crossing order. It hits both legs of an arbitrage, so you pay it twice per round trip.
- Withdrawal (network) fee
- The flat charge an exchange takes to send a coin on-chain, set per asset and per network. Picking the cheapest open network can decide whether a small spread is worth taking. Cheapest network →
- Net spread
- The gap that is left after every cost is subtracted - both taker fees, the withdrawal fee and expected slippage. This is the number that actually lands in your pocket. Common mistakes →
- Notional / size
- The dollar value of the position you are putting on. Bigger notional lifts the raw profit but also raises slippage, so the best size is where net spread times size peaks.
- Break-even
- The spread width at which the trade exactly covers its costs and returns nothing. Anything tighter than break-even loses money once fees and transfer are counted.
- Basis
- The difference between the futures price and the spot price of the same asset. A positive basis is what a cash-and-carry trade captures as the two prices converge. Spot-futures →
Data & signals
How Finder measures a spread.
- Spread %
- The raw percentage gap between the buy price on one venue and the sell price on another, before any costs. A useful headline, but never the number you trade on.
- Executable spread
- The spread you could realistically fill right now at a real size, after fees, book depth and an open transfer rail are all accounted for. This is what Finder ranks on. Live spreads →
- Phantom spread
- A big headline gap that vanishes on contact - caused by a thin book, a stale or bad print, or a closed withdrawal. It looks tradable but cannot be filled. Common mistakes →
- Order-book depth
- How much size is resting at each price level of the book. Deep books let you trade larger with little slippage, thin books collapse the moment you send size.
- D/W status (deposit / withdrawal)
- Whether an exchange currently allows deposits and withdrawals for a coin on a given network. If withdrawal is off on the buy side, the spread cannot be moved and is not real. Live spreads →
- Transfer rail
- The specific network path used to move a coin between two venues, such as an asset on a particular chain. A rail has to be open on both ends before a cross-exchange spread is tradable. Cheapest network →
Risks & pitfalls
Where good-looking spreads go wrong.
- Withdrawal halt (frozen rail)
- An exchange pausing withdrawals for a coin or network, often during congestion, maintenance or a listing rush. Your coin is stuck on that venue until it reopens, so the spread is frozen too.
- Thin book (low liquidity)
- An order book with little resting size, where even a modest trade moves the price against you. Thin books are the most common reason a spread looks bigger than it can ever pay.
- Wick / bad print
- A single extreme trade or a glitchy data point that spikes the chart for an instant and then reverts. It can fake a huge spread that no one could have actually filled. DEX-Dumps →
- Kimchi premium
- The persistent price gap on Korean exchanges versus the global market, driven by local demand and capital controls. Famous, but hard to capture because moving funds in and out is restricted.
- Ticker collision (crypto vs stock)
- When a crypto symbol matches an unrelated ticker, such as a tokenised stock or a same-named coin, and a naive feed compares the wrong two prices. It produces spreads that do not exist.
- Funding cadence normalisation
- Restating funding rates to a common interval so venues paying every 1, 4 or 8 hours can be compared fairly. Without it an eight-hour rate looks far larger than an hourly one. Funding cadence math →
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See these terms on live spreads
Finder applies every definition here in real time - net of fees, with honest deposit and withdrawal status per network.
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