Arbitrage Trading Bot for Ethereum and EVM-Compatible Blockchains

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Introduction to Arbitrage Bot

Welcome to the Arbitrage-Bot repository, designed to simplify arbitrage strategies for blockchain developers. This project offers detailed documentation and step-by-step guidance to help you understand and implement arbitrage trading on Ethereum and other EVM-compatible chains. Whether you're a beginner or an experienced developer, this resource empowers you to create profitable trading strategies.

Key Features of the Arbitrage Bot

  1. Comprehensive Documentation – Clear explanations and commented code for easy understanding.
  2. Security-First Approach – Digitally signed updates ensure code integrity.
  3. Multi-Chain Support – Compatible with Ethereum and other EVM-based networks.
  4. Local Testing Environment – Includes a Hardhat node for safe practice.
  5. Customizable Strategies – Adapt the bot for different tokens and market conditions.

Understanding Arbitrage Trading

What is Arbitrage?

Arbitrage is a trading strategy that exploits price differences of the same asset across multiple markets. Traders buy low on one exchange and sell high on another to generate profit.

Why Use Blockchain for Arbitrage?

Getting Started with the Arbitrage Bot

Prerequisites

Installation Steps

  1. Clone the Repository

    git clone https://github.com/Innovation-Web-3-0-Blockchain/Arbitrage-Bot.git

  2. Install Dependencies

    npm install

  3. Configure Environment Variables
    Create a .env file with these parameters:

    ARB_FOR="TOKEN_ADDRESS"       # Token you're arbitraging
ARB_AGAINST="TOKEN_ADDRESS"   # Paired token
PRICE_DIFFERENCE="0.05"       # Minimum profitable price gap
GAS_LIMIT="300000"            # Transaction gas limit
GAS_PRICE="50"                # Gas price in gwei

    👉 Learn more about setting up your trading environment

  4. Launch Local Hardhat Node

    npx hardhat node

  5. Deploy Smart Contracts

    npx hardhat run --network localhost scripts/1_deploy.js

  6. Start the Trading Bot

    node scripts/bot.js

Advanced Configuration

Customizing Arbitrage Strategies

The default strategy compares Uniswap and Sushiswap prices. Modify these components for different approaches:

Mainnet Deployment

For live trading:

  1. Replace test RPC URLs with mainnet providers (Infura/Alchemy)
  2. Fund your bot wallet with ETH for gas fees
  3. Monitor transactions closely during initial runs

👉 Explore advanced mainnet deployment strategies

Security Best Practices

  1. Private Key Protection
    Never commit .env files to version control.
  2. Contract Audits
    Review smart contract code before mainnet use.
  3. Gas Optimization
    Test transactions thoroughly to avoid failed arbitrage attempts.

Frequently Asked Questions (FAQ)

Q: Can this bot trade on Binance Smart Chain?

A: Yes, the bot supports any EVM-compatible chain by adjusting the RPC URL.

Q: What's the minimum capital required?

A: This depends on token prices and gas costs. Start with ≥1 ETH equivalent.

Q: How often does the bot scan for opportunities?

A: The default interval is 30 seconds, adjustable in the code.

Q: Is front-running a risk?

A: Yes, sophisticated MEV bots may outcompete simple arbitrage strategies.

Q: Can I add more exchanges?

A: Absolutely! Integrate additional DEXs by expanding the price comparison logic.

Q: What profit margins are typical?

A: Typically 0.5%-3%, varying by market volatility and gas costs.

Contribution Guidelines

We welcome community improvements:

Final Notes

This open-source project continues evolving with the DeFi ecosystem. Regular updates will incorporate:

For developers seeking deeper blockchain trading insights, this bot serves as both educational tool and functional trading system. Always test thoroughly before committing real funds to any trading strategy.

👉 Discover more blockchain trading opportunities