Arbitrage consists in buying an asset on a platform where it is cheaper and selling it on another where it is more expensive, pocketing the difference without betting on market direction. This mechanism ensures bitcoin price consistency across platforms worldwide. The most famous case remains the kimchi premium in South Korea, where bitcoin traded up to 50 % above the global price in January 2018 due to capital controls limiting cross-border flows. For retail traders, manual arbitrage has become nearly impossible: gaps are measured in fractions of a percent and close within milliseconds, captured by high-frequency trading algorithms. However, regulatory barriers between countries continue to create residual premiums, as demonstrated by the return of the kimchi premium during bitcoin’s record highs in 2024.
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