Post
Topic
Board Trading Discussion
Re: How do exchanges work?
by
tyz
on 18/01/2024, 22:02:11 UTC
My question is why is the rate higher on one exchange than on another?

The price is made by supply and demand. If demand on an exchange is greater than supply in the short term, prices can rise more sharply there than on other exchanges and vice versa. However, this is usually only the case in the short term because there are many so-called arbitrage traders who use price differences between exchanges to buy cheaper on one and sell more expensively on the other. As a result, the price usually adjusts quickly across exchanges.