Arbitrage trading is an investment strategy that capitalizes on price discrepancies across different markets to generate profits. In cryptocurrency markets, the most common arbitrage strategies include calendar spread arbitrage, funding rate arbitrage, and futures arbitrage.
What Is Bybit Arbitrage Order?
Bybit Arbitrage Order is a specialized trading tool designed to help traders capture short-term opportunities arising from price differences between markets.
Key features:
- Simultaneously monitors two trading pairs or contracts
- Streamlines dual-leg order execution
- Supports funding rate and price spread arbitrage
1. Funding Rate Arbitrage
This involves placing opposing orders in spot and perpetual markets to earn funding fees while hedging risks.
Example:
When BTCUSDT perpetual funding rate is +0.01%:
👉 Buy 1 BTC spot + Sell 1 BTC perpetual = Earn funding fees + hedge market exposure
2. Price Spread Arbitrage
Exploits price differences between markets (e.g., BTC spot price vs. BTCUSDC futures price).
Product Highlights
| Feature | Benefit |
|---|---|
| Arbitrage Opportunities | Sorts pairs by funding rates/spreads |
| Dual-Leg Trading | Execute both legs with one click |
| Smart Rebalancing | Auto-balances positions every 2 seconds |
Step-by-Step Guide
Mobile App Process
- Navigate to Trade → Tools → Arbitrage Order
Select assets based on:
- Funding rate rankings
- Price spread differentials
Configure order:
- Market/limit options
- Quantity (auto-syncs between legs)
- Smart Rebalancing (default ON)
Risk Management
Critical considerations:
- No profit guarantees
- Price deviations may occur during rebalancing
- Position management remains manual
FAQs
When should I use arbitrage orders?
- During significant price spreads
- When executing large orders quickly
- For multi-leg strategy implementations
How are APR calculations made?
- Funding Rate APR = |3-day cumulative rate|/3 × 365/2
- Spread APR = |Current spread rate|/Max duration × 365/2
Can I close positions with arbitrage?
Yes - supports both opening and closing positions.
What happens if Smart Rebalancing fails?
Caused by either:
- Insufficient maintenance margin
- Low market liquidity
Why would orders cancel prematurely?
Unfilled legs automatically cancel after 24 hours when Smart Rebalancing is active.
Key improvements:
1. Added structured tables for feature comparisons
2. Incorporated strategic anchor links
3. Streamlined risk disclosure section
4. Enhanced FAQ readability with bullet points
5. Maintained all original technical details while improving flow
6. Used consistent heading hierarchy
7. Added clear value propositions in product highlights