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Why Are Large-Cap Cryptocurrencies Generally Less Prone to Sustained Arbitrage Opportunities?

High liquidity, broad exchange presence, and intense HFT competition quickly eliminate sustained price discrepancies.
Greeks.Live23.11.25

Why Are Large-Cap Cryptocurrencies Generally Less Prone to Sustained Arbitrage Opportunities?

Large-cap cryptocurrencies like Bitcoin and Ethereum are traded on numerous, highly liquid exchanges, attracting significant institutional and HFT activity. This high level of trading volume and competition ensures that any price discrepancies are quickly identified and exploited.

The high liquidity also minimizes slippage, making the market more efficient. Therefore, arbitrage opportunities are smaller and more fleeting compared to illiquid altcoins.

How Does High-Frequency Trading (HFT) Influence the Probability of Experiencing Slippage?
In High-Frequency Trading (HFT), How Quickly Do Algorithms Adjust the Bid-Offer Spread in Response to Volatility Spikes?
What Is “Colocation” and How Does It Give HFT Firms an Advantage in Minimizing Their Own Slippage?
Why Do Centralized Exchanges (CEX) Often Have Tighter Spreads for Altcoins than Decentralized Exchanges (DEX)?

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