True Price XRP

11 בדצמ׳ 2017

Arbitrage is the simultaneous purchase and sale of an asset to profit from a difference in the price. It is a trade that profits by exploiting the price differences of identical or similar financial instruments on different markets or in different forms.

In cryptocurrencies, arbitrage is difficult - if not impossible to profit from due to the large transaction costs of buying and sell on the different exchanges.
Some exchanges have fees in excess of 3%. This means that the difference in price between exchanges would have to be greater than the transaction cost in order to profit.
This also does not take into account the risk of price movement in the time it would take to transfer funds between exchanges, making the ability to profit from arbitrage impossible for the retail investor.

While "arbitrage" may be intuitively associated with "sabotage" to the uninformed, the occurence is not a result of greedy price manipulation. The difference in price between exchanges can be simply justified by the separation of market depth creating an indipendantly operating order book.
Essentially, this is an individually performing market with a unique price spread.

In order to determine the most visually accurate price, I have averaged the asking price of these six exchanges:

1. KRAKEN
2. BITSTAMP
3. BITFINEX
4. BITTREX
5. POLONIEX
6. BITSO

This plotted line can be overlayed on top of any XRP/USD price from any given exchange in order to view the variance from the average in real-time, or you can hide the underlying chart to view only the average of the six exchanges as demonstrated in the chart above.

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