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Arbitrage opportunities can also exist in cryptocurrency markets. Suppose you observe the following exchange rates of bitcoin (BTC) relative to the U.S. dollar (USD) and

Arbitrage opportunities can also exist in cryptocurrency markets. Suppose you observe the following exchange rates of bitcoin (BTC) relative to the U.S. dollar (USD) and ethereum (ETH) and the USD relative to ETH on BitMEX, a Hong Kong-based cryptocurrency exchange platform:

Base Currency/Quote Currency Bid Ask

BTC/USD 7,585.22 7,586.82

ETH/USD 194.85 194.91

ETH/BTC 0.02570 0.02575

BTC and ETH are cryptocurrencies, whereas USD is fiat currency.

Determine if triangular arbitrage is possible. If so, outline a trading strategy.

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