lIliquid cryptocurrency markets often present lucrative arbitrage in a many opportunities for traders due to price discrepancies between different exchanges.

Arbitrage involves buying an asset at a lower price on one exchange and selling it at a higher price on another exchange to profit from the price difference.

In illiquid markets, where trading volumes are low and order book depth is limited, prices may not reflect the true market value of an asset, creating arbitrage opportunities for savvy traders.

By exploiting these price discrepancies, arbitrageurs help to improve market efficiency by aligning prices across different exchanges and reducing inefficiencies.

However, arbitrage opportunities in illiquid markets come with risks, including execution risk, where trades may not be executed as expected, and counterparty risk, where traders may face challenges in settling trades due to liquidity constraints.

Therefore, arbitrage in illiquid markets requires careful risk management and execution strategies to ensure profitability.