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How Cryptocurrency Exchange Interruptions Create Arbitrage Opportunities

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review

2 Scopus citations

Abstract

Centralized cryptocurrency exchanges offer users a more convenient platform to trade their digital assets at the cost of reduced control. As a result, when these exchanges suffer interruptions users struggle to access their funds or modify their orders. We investigate 41 events at the popular exchange Bitfinex, and measure the impact these events have on trades, volume, and pricing. We find that the volume to trade ratio increases during events, as fewer traders are moving large amounts of bitcoin. We also find that these interruptions often occur at the same time as arbitrage opportunities, with substantial profit opportunities.
Original languageAmerican English
Title of host publication2023 IEEE European Symposium on Security and Privacy Workshops (EuroS&PW)
PublisherIEEE
Pages207-215
Number of pages9
ISBN (Print)979-8-3503-2721-2
DOIs
StatePublished - Jul 7 2023
Externally publishedYes
Event2023 IEEE European Symposium on Security and Privacy Workshops (EuroS&PW) - Delft, Netherlands
Duration: Jul 3 2023Jul 7 2023

Conference

Conference2023 IEEE European Symposium on Security and Privacy Workshops (EuroS&PW)
Period07/3/2307/7/23

Keywords

  • Costs
  • Volume measurement
  • Pricing
  • Bitcoin
  • Delays
  • Computer crime

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