Trading and Arbitrage in Cryptocurrency Markets (Summary)

CFA Institute Journal Review summarizes "Trading and Arbitrage in Cryptocurrency Markets," by Igor Makarov and Antoinette Schoar, from the Journal of Financial Economics, February 2020.

Overview

Cryptocurrency prices exhibit deviations across various exchanges. These deviations are greater among countries and smaller among different cryptocurrencies. Normally there are positive spreads over prices in the United States and Europe, which co-move and open up during bitcoin appreciations and persist over several days and weeks. Limitations on arbitrage through capital controls and lack of regulatory oversight make these differences recurring, and they add to market segmentation and inefficiency

To read the full summary click  here . 

CFA Institute Journal Review is written by CFA Institute members for practitioners, bringing the findings of the most relevant journal articles to you in a quick, easy-to-read format.