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Crypto arbitrage in South Africa

A viable income strategy
Crypto arbitrage in South Africa can indeed be a viable "admin business" income strategy, and it’s an interesting way to navigate the world of a stable trade in cryptocurrencies and forex exchange WITHOUT the risk of market fluctuation.

1. What Is Crypto Arbitrage?
o Crypto arbitrage involves taking advantage of price differences for the same cryptocurrency across different exchanges. Essentially, you buy a cryptocurrency at a lower price on one exchange and sell it at a higher price on another exchange, pocketing the difference.
o In the context of South Africa, this strategy is particularly appealing due to varying prices across multiple exchanges and the difference in the price of Bitcoin (BTC) when purchased in U.S. Dollars (USD) versus South African Rand (ZAR)1.

2. How Does It Work in South Africa?
o The arbitrage opportunity in South Africa arises from exchange-control laws. These laws limit tax-compliant individuals to send out a certain amount of money as part of their single discretionary allowance (SDA) and foreign investment allowance (FIA).
o Solutions like LocalSpot.co.za
offer a solution: they empower clients to view markets and lock in their profits themselves, effectively looping a smaller amount of money over multiple trades to complete the larger FIA allowance. For example, they might trade R250,000 over 44 trades to reach the R11 million FIA limit, however larger amount reduce bank fees as each transaction typically may cost R500 or more.
o The client is never exposed to cryptocurrency price fluctuations or forex movements, making it a relatively low-risk strategy. Plus, clients can withdraw their funds at any time.

3. Regulation and Unique Features:
o LocalSpot stands out for a few reasons:
 They use FSCA-regulated financial services providers, managing parts of the arbitrage service that fit within traditional financial services.
 They use a SARB-approved forex intermediary, facilitating outward forex payments for purchasing cryptocurrencies offshore.
 Unlike some other players in the market, LocalSpot.co.za
adapts to the fixed low subscription and not sharing up to 35% of your profits.
 In summary, crypto-arbitrage remains a viable strategy, even with a gross premium of approximately 1% to 3% in current market conditions. It’s an excellent vehicle for building up your own crypto investment portfolio as you can make between R120,000 to R300,000 per year without the risk of market volatility.

4. Profitability and Limits:
o The profitability of crypto arbitrage in South Africa is capped by foreign exchange rules. Typically, gains are limited to around R100,000 to R350,000 per person annually.
o Some investors maximize their gains by using their allowance and their spouses’ allowances, effectively doubling their annual returns.


Just remember that like any investment or business strategy, it comes with some transaction risks, like most bank transactions. ????????