Wow, that's a lot of different opinions, and I really appreciate your comments. As you may have noticed, I'm speaking through a translator, so it's not going to be easy to respond to each and every one of them, but I'm going to say a little bit more because there are a lot of people who are curious about this trading strategy.

i don't actually send any crypto, and this is a very important point. There's a common misconception that you have to transfer when you arbitrage. You don't have to. (I say transfer in the body of the post because I didn't really want to say this, but I changed my mind because you guys are curious.) When I do this trade, I go short on Binance and buy spot on upbit, and then I just wait for the spread between the two to widen. In other words, I don't go in after the spread widens. I do the buy before the spread widens.

But you can't just pick up any crypto and wait for the spread to widen, right? So I pick a crypto that's prone to price distortion. This usually happens with altcoins.  For example, the crypto I'm currently holding is 'flow'. In my experience, there is a good chance that this trade will give me at least a 1% return this week (but there are no guarantees in the world).


I made a chart of FLOW's spread for you guys.

https://kr.tradingview.com/chart/p60QXU2S

Or, if you want to see more detailed movement, try plugging this formula directly into TradingView.

(upbit:flowkrw-binance:flowusdt.p*fx_idc:usdkrw)/(binance:flowusdt.p*fx_idc:usdkrw)*100



I'm holding when the spread on 'FLOW' is 2.5%, and you can see if it goes higher than that in the future. I'll probably exit the position between 3.5% and 6%, depending on the volatility at that time. There are many factors that contribute to this distortion. It could be that the crypto upgrade cut off deposits and withdrawals, it could be that the price has gone up a lot and people are going crazy, or it could be that the price has dropped so much that it's not keeping up with the price overseas. I'm trying to figure this out and do some proper arbitrage.


In January, February, and March, I had fun with aptos.
https://kr.tradingview.com/chart/r0EdVNMl/


KAVA is a classic example of a crypto pranked by Korean whales. No matter what the price is overseas, it sometimes happens that it only makes a price in Korea.
https://kr.tradingview.com/chart/f81jB9R7/


Two weeks ago, METAL was doing this.
https://kr.tradingview.com/chart/wqrts0jF/


By the way, only Koreans can do this on upbit. Upbit doesn't accept foreigners, but since Korea doesn't have a perfect crypto policy, it's possible for Koreans to use Binance Global, so I can hunt for these arbitrage opportunities. Of course, I don't think this arbitrage will last forever. One day, when the crypto market stabilizes in terms of policy, the loophole will be closed. But before that happens, I've been thinking about whether there's something to grow. I was very curious to see how it was viewed by global traders. I guess the trust issue is the biggest barrier for me to scale it into a business. Thanks for your thoughts.


oh. I have one more question: In my country, it is illegal for an individual who is not registered as an investment company to manage other people's money. I assume it is the same in your country? It seems difficult to create a legal organization and do business with crypto.

Have a good day everyone.

I have never discussed this on the global forum. so I don't know how people will understand it.


I'm just writing to see what people think.





I have been arbitraging in Korea for 3 years now.


There is a special premium on the Korean exchange.


It usually moves from -3 to 10% over the global price.


If you enter this formula in TradingView, you can see the price premium on the Korean exchange.


'upbit:btckrw/(balance:btcusd.p*fx_idc:usdkrw)*100-100'




The premiums of some altcoins move even more dramatically.



I profit from this difference, usually by moving money between the Korean exchanges and Binance when the market timing is in my favor.


I then hedge the perpetual market to avoid the risk of price fluctuations.


There are more complex techniques.


In South Korea, I'm pretty sure I'm in the top 1% of people who utilize this trading technique.




In 2021, I had a 334% return (everyone made a lot of money back then) and


53% return in 2022


This year, I'm already up 59%.



So far, I've made a net profit of about $429,000 over three years from this trade.




I'm sure there are plenty of people out there with better returns than that, but the strength of my trading method is not in the returns, but in the stability.


I'm free from the risk of price fluctuations. If the price of Bitcoin drops to $1k, I'll still make money.


As liquidity and volatility increase, so does the premium differential, which opens up more opportunities.



SBF also left Korea around 2018 to hunt for price premiums. (It is now difficult for foreigners to operate on the Korean exchange).


The only risk in this trade is that the centralized exchange goes under.




Anyway, what I'm wondering is if these advantages are also attractive to non-Korean global investors.


The returns are not bad, but I feel passive and foolish doing this alone in my room.


I've been doing this by myself for three years, and now I want to expand, and I'm always thinking that there are more opportunities if we collaborate globally.


In a world where scammers are setting up sites and scamming investors, why can't I create an arbitrage system that makes real trades and generates consistent profits?


Do you guys think I have a good chance? Or is this just an uninteresting story?


I've been thinking about this a lot myself, so I'd like to see what the global forum thinks.




Thanks for reading this long post.