Understanding Arbitrage💱

Arbitrage is a complex mathematical function.

🌠What Is Arbitrage ?

Arbitrage is the simultaneous purchase and sale of the same asset in different markets in order to profit from differences in the asset's listed price. It exploits short-lived variations in the price of identical or similar financial instruments in different markets or in different forms. Many other forms of arbitrage are utilized for about anything that has a difference in two values. So for ex. There are two burger restaurants on the sameies street. they both sell soda pop and pizza. one restaurant sells your favorite pizza for less than the other. the other sells soda pop for less than the other. If you were to be clever about arbitrage you could go to both restaurants, but only buy pizza at the lower cost, and then go to the other restaurant to buy the soda. you have just done arbitrage by using the price differences to get the same products for less.

🤷‍♂️How does it apply to digital assets🤷‍♀️?

Stable-coins are cryptocurrencies designed to be pegged to or float near fiat currencies. This gives traders and savers comfort knowing the value of these coins in the real world will be the same tomorrow as it is today. This is the goal of stable-coins, but sometimes is not the reality. Stable-coins sometimes go off their peg for an extended period of time due to fluctuations in demand and supply. This fluctuation causes headaches for those who depend on the stability of their stable-coins for everyday usage.

🐱‍🏍How does Aggregating Arbitrage help?

Aggregated arbitrage broadens the scope of possibilities for utilizing arbitrage from narrow market idea to realistic trade application. The concepts translate to many fields of study and currencies. Stabilize sees a need for individualized per protocol arbitrage due to the nature of shifting markets requiring a broad scope of possibilities available to fulfill needs. Aggregating is the process that Stabalize.Finance brings together development processes with production practices to produce value. Individually helping specific protocols to cluster arbitrage success where usually a costly internal process is required; now utilizing a decentralized aggregating arbitrage system community driven process to overcome loss of internal funds and matters of integrity.