Arbitrage
Plain English
Buying an asset where it’s cheap and immediately selling where it’s expensive, profiting from the price difference. Like buying gold in one city for $100 and selling in another for $105. Arbitrage traders keep prices similar across different exchanges.
Technical
Exploiting price discrepancies of identical assets across different markets/venues for risk-free profit. Types: spatial arbitrage (cross-exchange), triangular arbitrage (currency pairs), statistical arbitrage. Arbitrageurs provide efficient price discovery and cross-market liquidity. MEV bots on Solana execute arbitrage at millisecond speeds. High competition reduces arbitrage opportunities to microseconds.