Cross-Chain Bridge Arbitrage
Cross-chain arbitrage captures price differences across blockchains. Bridge cost time and failure risk factor into every decision.
Cross-chain arbitrage exploits price differences for the same token across different blockchains. ETH on Ethereum vs Arbitrum vs Polygon can trade at slightly different prices due to bridge latency and liquidity fragmentation.
DexArb monitors bridge transfer times and costs. Canonical Ethereum to Arbitrum bridge takes about 10 minutes. Fast bridges (Across, Stargate) complete in seconds but charge 0.05-0.1% fees. The system factors bridge cost plus time into profitability.
Execution risk: bridge transactions can fail during congestion. DexArb sets maximum acceptable bridge time per opportunity. If queue exceeds threshold, trade is abandoned rather than risk spread closing during transit.
Multi-hop routing finds opportunities invisible to two-chain scanners. Up to 3-hop routes evaluated while keeping total fees and time under profitability thresholds.