Arbitrage: why the same coin costs about the same everywhere

Bitcoin trades on hundreds of venues, yet its price is usually almost identical everywhere. The reason is arbitrage: buying where something is cheap and selling where it is expensive at the same time.

Kinds of arbitrage

• Between exchanges: if BTC is cheaper on one exchange, traders buy there and sell on another until the gap closes.
• Spot and futures: if a perpetual future trades well above spot, traders can sell the future and buy spot. Funding payments pull the prices together — see Funding rate, mark price and index price.
• Triangular: within one exchange, three pairs (for example BTC/USDT, ETH/BTC and ETH/USDT) imply prices for each other; a mismatch can be traded around the triangle.
• Wrapped and native assets: a wrapped token trading away from the original invites minting or redeeming. See Wrapped tokens and bridges.
• Stablecoin redemption: large holders can create or redeem fiat-backed stablecoins with the issuer, which helps keep their price near 1.

What limits arbitrage

• Fees and spreads on both sides.
• Time to move funds between exchanges or networks.
• Withdrawal limits and account checks.
• Risk that prices move during the transfer.

Because of these limits, small differences remain and larger ones can persist when transfers are slow or blocked.

Why it matters

Arbitrage is the reason a single reference price makes sense. XFasil shows prices from one major exchange; other venues usually trade close to them, but not always exactly the same.