This is the second part of my evaluation of a Bitcoin-arbitrage strategy. As mentioned in my original post (http://www.investinstuff.com/2017/05/05/evaluation-of-bitcoin-arbitrage-as-a-trading-strategy/) I made two test runs to try out Bitcoin-Arbitrage as a Trading strategy.
As mentioned in my original post, I’m testing the following scenarios:
- First test run with ~750EUR from an EUR exchange (bitcoin.de) to a US-exchange (Bitfinex).com and then change my BTC in USD –> pretty unfavorable setup in terms of fees and costs
- The second test run ~3000EUR is done with two EUR exchanges (BTC-e and Bitcoin.de) – this second setup is in my case as a European the best possible and economic setup –> I split the invest in BTC and LTC
So far my resume is, that I’m pretty disappointed with the developments in the Bitcoin area. After the Mt.gox hack, there were more hacks, more scams and some scams are still going on. Also, Mt.gox users are still waiting for a part of their money which is still stuck in the insolvency case in Japan.
- Only use trusted exchanges (Bitcoin.de, Kraken.com)
- Always split investments onto different exchanges if handling bigger amounts of money
- There is still money to be made but only for those who know how the game works and which partners(exchanges) to trust
For my test run I used the following Bitcoin exchanges:
And I can say that I only trust Bitcoin.de a 100% as a know that german regulators ar probably the most restrictive but also Kraken.com is trusted as I’m also aware that it is been used as a partner in the Mtgox insolvency case to redistribute the remaining Mtgox funds. Btc-e was back then around 2013 a good place to go but in this actual experiment, I made a pretty bad experience with them. After funding my account and providing them already beforehand with my full verification documents they locked my account without any info – so the exchanged Bitcoins could not be transferred…2-3 days later after sending the same verification documents the third time they unlocked my account whereas the Bitcoin price and the LTC price was already dropped some percentage points. I send the BTC to Bitcoin.de and the LTC to Kraken.com – now I’m waiting for prices to come back a bit (and speculating for a little profit).
Results so far…
- First test run —> Money still stuck at Bitfinex.com (withdrawal was made on 05.05.2017)
- Second test run –> BTC-E blocked my account without notice, therefore, the arbitrage failed and I will try to speculate to get at least my original Investment back
I will keep you posted.
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