Anybody out there arbitraging cryptos? There seem to be a LOT of large differentials, but I would wonder how to go about it. Is there any way to make a trade algo for them?
If bitcoin trades at a premium, like bitfinex, it means you cannot get dollars out. In the Mt gox scenario the way to get out of the exchange was to cancel the wire transfer, buy expensive bitcoin and Transfer to a wallet on your pc.
Don't fixate on settling to USD since getting your USD out is much more difficult due to regulation. There are other liquid cryptocurrencies that you can move out easily.
I looked at this quite a bit and came to the conclusions that: 1) There are actually much less opportunities that you can see due to fairly high transaction cost 2) The quantities you can arbitrage are so small that even if you catch 100% of them, it wouldn't cover a full time quant salary, let alone server cost / credit risk / mid-back office.