Arbitrage is the strategy of leveraging price disparities of an asset or security across multiple markets to generate profits. This involves capitalizing on variations in prices between different exchanges or platforms. For instance, if exchange ABC offers bitcoin (BTC) at $40,000 while exchange XYZ lists it at $40,015, an arbitrageur can exploit this difference by purchasing BTC from the lower-priced exchange and selling it on the higher-priced one, earning a profit of $15 per bitcoin in the process. To execute such trades swiftly and efficiently, automated systems and software are commonly employed to monitor market prices. Arbitrage serves a crucial role in maintaining price consistency among exchanges and ensuring market efficiency across various financial platforms.