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What Is ‘Information Asymmetry’ and How Does It Relate to Market Efficiency in Crypto?

One party having better information creates mispricing opportunities, contradicting Strong and Semi-Strong EMH.
Greeks.Live23.11.25

What Is ‘Information Asymmetry’ and How Does It Relate to Market Efficiency in Crypto?

Information asymmetry is a situation where one party in a transaction has more or better information than the other. In crypto, this can be due to insider knowledge, faster news feeds, or privileged on-chain data access.

This asymmetry directly violates the Strong and Semi-Strong forms of EMH. Arbitrageurs who possess an information advantage can profit from mispricing before the information is fully reflected in the price, reducing efficiency.

What Is the Efficient Market Hypothesis (EMH) and Its Three Forms?
What Are the Ethical Implications of Profiting from Information Asymmetry?
How Can an Exchange’s Own Trading Desk Create Information Asymmetry?
Explain the Concept of “Information Asymmetry” in the Context of Derivatives Trading Front-Running

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