pexels david mcbee 730564Finding crypto arbitrage opportunities
Millions of dollars are being sucked out of the system by arbitrageurs daily.
— Infy (@omgitsinfy) August 20, 2022
Yet most people suck at finding arbitrage opportunities.
Here’s an easy trick for finding them:
🧵
1/ Are you struggling to find arb opportunities?
— Infy (@omgitsinfy) August 20, 2022
Just look for clues that your competitors leave behind.
Here are 4 simple steps to finding them:
1. Look for competitors
2. Find what they are arbing
3. Connect the dots
4. Discover other strategies
Ready to learn?
Let’s go!
2/ Look for competitors
— Infy (@omgitsinfy) August 20, 2022
This is a long process that yields outsized rewards.
To find your competitors, look through the transactions of a crypto pair that you know has other arbitrageurs.
Examine one of these transactions on BSCscan by clicking on the TXN number. pic.twitter.com/tZwUbJ2XUZ
3/ Look into BSC scan to see the transaction details.
— Infy (@omgitsinfy) August 20, 2022
This competitor(I will call him Joe) swapped $100 BUSD for $UST 1559.18 via @1inch.
Dexscreener captured the UST 868.65 purchase with $56.00 BUSD on Pancakeswap (Green Box) but not the other half of the purchase (Red Box). pic.twitter.com/npPHLErbtL
4/ Find what they are arbing
— Infy (@omgitsinfy) August 20, 2022
I will use @DeBankDeFi to visualize the on-chain journey.
He bridged $UST 1559.18 over to the Terra blockchain and swapped it for BTL.
Then he bridged 17,860.34 BTL back to BSC to sell:
$137.67 BUSD – $100 BUSD = $37.67 (Net Profit)
~38% gain. pic.twitter.com/AMUIGYWi8K
5/ Connecting the dots
— Infy (@omgitsinfy) August 20, 2022
How do we confirm this arb route?
By verifying the transaction on Terra with the price screener @coinhall_org.
Remember how he received 17,860.34 $BTL back on BSC?
Here it is on Terra’s BTL/UST pair:
17,860.34 BTL for UST 1558.80 (After fees) pic.twitter.com/nTohX6yuJT
6/ We have verified Joe’s arb strategy as:
— Infy (@omgitsinfy) August 20, 2022
> Swap BUSD for UST
> Bridge via @wormholecrypto to Terra
> Swap UST for BTL
> Bridge via wormhole back to BSC
> Swap BTL for BUSD.
We have exposed a profitable strategy by following the on chain clues.
But wait…
There’s more!
7/ Discovering other strategies
— Infy (@omgitsinfy) August 20, 2022
Let’s use the History tab on Debank to help us discover more clues. pic.twitter.com/AECoKiGa8k
8/ We can see that he is trading $LUNA and $PLY.
— Infy (@omgitsinfy) August 20, 2022
Joe bridged 2184,913.20 LUNA over to the Terra blockchain and received 15,539.49 PLY back on BSC.
The profit for this trade is:
$212.87 BUSD – $200 BUSD = $12.87 (Net Profit)
~ 6% gain.
How did this happen? pic.twitter.com/fGhVU8YAES
9/ Let’s click on his address for the onchain data on Terra.
— Infy (@omgitsinfy) August 20, 2022
Joe's strategy for this arb route:
> Swap BUSD for LUNA
> Bridge to Terra
> Swap LUNA for UST
> Swap UST for PLY
> Bridge back to BSC
> Swap PLY for BUSD.
Seems like another profitable strategy to copy. pic.twitter.com/GhepEPEliF
10/ If you are having trouble finding arb opportunities, you can:
— Infy (@omgitsinfy) August 20, 2022
1) Look for competitors
2) Find what they are arbing
3) Connect the dots
4) Discover other strategies
Bonus tip: All the profitable secrets are on chain.
You just need to follow the clues and connect the dots.
Fei Protocol: New low for DeFi?
I can't stand to not speak up about this @feiprotocol situation. Please read this 🧵 for one of the most egregious "DAO/DeFi" situations I've ever seen. There's CeFi drama stuff, but this is a new low for DeFi.
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
Some background on what's going on: In late 2021 Fei Protocol (the stablecoin) did a merger with Rari Capital DAO (developers of the Fuse money market). The merger passed overwhelmingly & $RGT tokens became $TRIBE tokens effectively sealing the deal. https://t.co/OCmYnu1gta
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
In late April 2022, the Fei-Fuse money market was drained due to a reentrancy bug. Many early adapters of Fuse lost millions. @fraxfinance a huge FEI/Fuse backer+lender+user lost ~$13m. @OlympusDAO lost ~$9m. The total hack resulted in nearly $80m lost.
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
The FEI/TRIBE DAO had 100s of millions USD in excess PCV at this time & held a governance vote where TRIBE holders voted overwhelmingly to reimburse all victims of the hack. They were applauded for this exemplary & ethical move. I sang their graces. https://t.co/h6RW1Nl6A9
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
Then weeks went by…🦗..no repayment. Then in May/June 2022, the crypto markets took their infamous downturn. Then FEI emerges with an insane proposal: "Let's do the repayment vote over again, the last one didn't count." The egregiousness of this is wild & absolutely ridiculous.
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
Of course, as you might expect, to no one's surprise the vote does not pass this time…the repayment of victims is off the table now.
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
@cobie had a good thread explaining it below. The gist of it is clear: FEI didn't want to repay victims because their stablecoin peg & treasury value was dangerously low. While passions were high, their supporters (including us at FRAX) were patient. https://t.co/N8jV6oQiNK
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
I even personally posted in the thread where they renegged on repayment, and I promised that any repayment to FRAX would permanently go to providing FEI-FRAX liquidity to bolster their peg. They'd be repaying FRAX AND STRENGTHENING THEIR PEG. Silence. Not even 1 reply. pic.twitter.com/Vkvl03viu1
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
I tried multiple times to reach out to @joey__santoro since June. No response. FRAX was on of their earliest supporters. I've met them all in real life. Nothing now. Not even a post mortem discussion/call with us after renegging on governance vote+repayment to all victims.
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
To his credit @JackLongarzo did speak to me in detail but when I asked for a meeting to discuss with him+Joey…silence…
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
Then today…the FEI team comes out that they're winding everything down. So what about the repayment of victims now that there's an orderly shutdown?
FEI has more than enough PCV to redeem every stablecoin at peg, repay every cent to victims, & STILL have ~$65m in value for $TRIBE holders to redeem & profit. But what are they doing instead? Giving FRAX, Olympus etc cents on the dollar leaving victims with 95% hack losses.
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
Take a look at this, curtesy of @dcfgod. If FEI repaid every hack victim, redeemed all FEI at peg, then distributed the remaining treasury pro rata to TRIBE holders, TRIBE would be worth $.16 with 10s of millions USD value given back to holders. A graceful & perfect sunsetting. pic.twitter.com/HL1leac3j4
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
Instead of the above, they're planning to do this 👇 They're preposing repaying FRAX 2% of $12.3m lost. 3% of @OlympusDAO's $8.9m lost. And just 19% & 27% of @BalancerLabs @VesperFi losses respectively etc. Why? How does this make any sense other than fraud? pic.twitter.com/NqeFOPvk1V
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
An honorable, ethical, & respectable shutdown of a DAO is literally perfectly here. The money is there. The full repayment, the perfect peg redemption, & moral precedent is possible. I truly don't understand how it's possible to look at this, then decide "Na let's take the rest."
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
This post in the Tribe forums resonates greatly. It straight up calls them out for simply wanting to keep more money for themselves at the expense of their early backers+friends solely because they probably think they can get away with it (they won't).https://t.co/F9SgijNYlu
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
Their investors include @hiFramework @a16z @nascentxyz among others. I've personally done nothing but try in good faith for many months to resolve this and in the end this is what FRAX gets for being one of their earliest backers and supporters. No good deed goes unpunished.
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
Is it really worth the FEI/Rari team doing this to their bright careers in crypto for a couple million more dollars? There's still time to take feedback & fix mistakes so everyone can move on in peace & give respect+credit to FEI/Rari for doing the right thing in the very end.
— Sam Kazemian (¤, ¤) (@samkazemian) August 20, 2022
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