Let's suppose that I have already set up an account at Exchange A and Exchange B, loaded each up with a small buffer of BTC (much less than 1 BTC), and am able to make API requests to buy/sell from these.
Now, I start pulling down sell/buy offers from both exchanges, automatically, every minute, all the time.
My script then picks the most affordable (for me) "sell" offer, regardless of the amount, and takes the offer (buys the coins). Instantly afterwards, it takes the most profitable (for me) "buy" offer on the other change (sells the coins).
It doesn't do these actions unless it calculates that the "rest sum" is over zero.
Is this not guaranteed to make me money each time this is done? And since it's automated, I only need to set it up once and then lean back and watch guaranteed money stream into my accounts, taking some of them out every now and then?
It sounds way too good to be true, so I must be missing something. Otherwise, I'm sure that this would be done by millions of people, around the clock, and it would quickly stop working. I feel as if this is probably very well known and long since "patched".
But in terms of my understanding of how marketplaces/exchanges work, this seems like it would work. Unless there is some kind of random delay or other uncertainty which makes it impossible?
Of course, those exchanges/marketplaces all require photo id to be scanned and sent to them, so I'm unable to try this out "live", but I still want to know why this wouldn't work.