How crypto arbitrage generates returns
DoshDex does not speculate on whether a coin's price will rise or fall. It seeks to profit from temporary price differences for the same asset that already exist between markets, right now.
Price discovery across venues
The same cryptocurrency trades on dozens of exchanges and markets worldwide. Fees, liquidity, regional demand and latency mean its price is rarely identical everywhere at the same instant.
Spread detection
DoshDex's trading operations monitor order books across multiple exchanges to detect moments where an asset can be bought on one venue for meaningfully less than it can be sold for on another, after estimated fees.
Simultaneous execution
When a viable spread appears, a buy order is placed on the lower-priced venue and a sell order is placed on the higher-priced venue as close to simultaneously as execution speed allows.
Settlement and reconciliation
Once both legs settle, the realized spread (minus trading, transfer and exchange fees) becomes part of the arbitrage activity's net result for that period.
Return allocation
Net results from arbitrage activity are what estimated returns on investment plans are based on. Contracts state an estimated return, never a guaranteed one, because spreads and execution conditions vary continuously.
A simplified example
Suppose a token trades at $100.00 on Exchange A and $100.60 on Exchange B at the same moment. Buying on A and selling on B captures a $0.60 gross spread per token, before trading fees, transfer fees and any slippage incurred while the orders fill. Spreads like this are typically small and short-lived, which is why arbitrage relies on speed, scale and continuous monitoring rather than any single large trade.
Why returns are never guaranteed
- • Spreads can close before an order fully fills (execution risk).
- • An exchange can pause trading, deposits or withdrawals (exchange risk).
- • Thin order books can make it costly to buy or sell size (liquidity risk).
- • Regulatory action can restrict a market with little notice (regulatory risk).
- • A wallet, API key or exchange account can be compromised (cybersecurity risk).
- • A counterparty or exchange can fail to honor a settlement (counterparty risk).