My question is about the bitcoin price in exchange of FIAT, not taking into account the slight difference of fees between exchange platforms (Binance, Coinbase....). As far as I know, they all propose the same Bitcoin price, which is today (after I googled Bitcoin Price): 44926.29 euros.

Since the Bitcoin price in FIAT is based on offer and demand only (am I right?), how do those platforms find the same course since they have a different vision of people wanting to buy and sell Bitcoin? For example, it is my understanding that: if I sell on Binance 100 Bitcoin, the price of Binance should go down, but in the same time if Alice buy 100 Bitcoin on Coinbase, the price there should incrase.

So how eventually do those platforms find a common price?


The suggested related question partially answers but there are still some points to add:

  • Who performs the arbitrage?
  • How fast is it?
  • Does it work for all crypto (of course traders work on Bitcoin but do enough people work on other subjects)?
  • @RedGrittyBrick Thank you for this link I did not find in previous research. It partially answers with the arbitrage strategy, but my question is still there: who performs arbitrage? Especially on "public platforms" which are not for traders but for common people? Dec 27, 2021 at 16:14
  • 1
    Common people can perform arbitrage, it's just buying on one exchange and separately selling on another. Dec 27, 2021 at 17:09
  • @RedGrittyBrick OK and do platforms adjust by themselves this ? I took the example of the bitcoin but for all the "small" cryptocurrencies that have a low price, does it work for same? Dec 27, 2021 at 19:51
  • The exchanges themselves have separate order books, and thus will generally not have the same price. However, if there is significant difference between different exchanges, money can be made by performing arbitrary, and thus someone will do it. It doesn't matter who does - as soon as some parties perform arbitrage, the prices will tend to synchronize. This happens for every cryptocurrency, and even for every asset in general: when trades happen in multiple places, traders will arbitrage between them. How fast this happens depends on the efficiency of the market. Dec 27, 2021 at 20:02
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    It's important to realize it is not the platforms agreeing on a price. The price you see quoted as the current exchange rate is simply the latest price any traders on that exchange agreed to perform a trade at. The fact that multiple platforms report a similar price is simply a sign of the fact that traders (i.e., the market) agrees that that is the current price, and traders wouldn't want to sell at anything but the highest price they can get, and buy at the lowest price they can pay, a value that is largely independent of the exchange used. The traders are the communication mechanism. Dec 27, 2021 at 20:23


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