Written by: Jaleel Jia Liu

The core project WLFI, honed by the Trump family for half a year, has launched and is attracting global attention. Some are betting on price fluctuations, while others are speculating on trending coins. Beyond the real trading of "betting on up or down," can we find a more certain way to profit from this wave of hype? The answer is arbitrage. In this article, Rhythm BlockBeats has compiled some practical arbitrage opportunities for WLFI:

Price Arbitrage

1. Price Arbitrage Between CEXs

Due to the different matching rules, opening hours, buying density, fees, and deposit/withdrawal arrangements of various trading platforms, there will be price discrepancies for WLFI in a short time, creating arbitrage opportunities.

For example, WLFI is set to open spot trading on Binance at 9 PM tonight, but withdrawals will only be available at 9 PM tomorrow. This means that before withdrawals are enabled, funds can only "flow into Binance and be sold to on-site buyers," but cannot "flow out" temporarily. This one-way flow can lead to higher on-site pricing.

The practical approach is quite simple. First, select two to three controllable scenarios as a "price difference triangle," usually involving one leading CEX (most likely Binance today, due to its high buying volume and public attention), one secondary CEX that supports withdrawals (preferably with lower fees to better preserve profits), and an on-chain observation point (like the WLFI pool on Uniswap, used to assess the strength of on-chain marginal buying).

At the same time, open the order books and recent transactions of both exchanges and monitor the price difference of WLFI. Once you see that the price on Binance is significantly higher than on the other exchange, and after accounting for trading fees, spreads, and potential slippage, if the net difference is still positive, you can buy on the lower-priced exchange and sell on Binance.

The difficulty of the entire process lies not in the "logic," but in the "timing." Cross-exchange arbitrage is essentially a race against delays: the opening of deposits and withdrawals, risk control pop-ups, on-chain confirmations, and even your own confirmation speed will determine whether this 0.x% to 1.x% gross profit can be realized. Therefore, it is safest to first run through the entire process with a very small amount to measure the time and costs of each step before scaling up.

2. Triangle Arbitrage

Triangle arbitrage can be simply understood as an upgraded version of the previous "price arbitrage between CEXs," involving more on-chain paths and sometimes requiring currency exchanges between stablecoins. Thus, there are more opportunities, but also more friction.

The most common "sandwich price difference" in the early stages of a project is: the price on the BNB chain is approximately equal to the price on the Solana chain, which is greater than the price on the Ethereum mainnet, which is greater than the price on the CEX. Since the pools on the BNB and Solana chains are generally smaller and have more bots, prices are more easily pushed up by a few orders; Ethereum has higher fees and fewer bots, leading to relatively conservative transactions and thus lower prices; while centralized exchanges are controlled by market makers and often do not open deposits and withdrawals or have limits, making it impossible for price differences to be immediately arbitraged away, resulting in the lowest spot price. Since WLFI is deployed across multiple chains, there is also room for such operations.

Additionally, new stablecoins like USD1 and USDT/USDC may have slight decoupling or fee differences, which can amplify loop profits.

However, it is important to note that triangle arbitrage is more complex than CEX arbitrage, and beginners should avoid attempting it. Prerequisites include being familiar with cross-chain mechanisms, cross-chain paths, slippage, and fees in advance.

3. Spot - Perpetual Basis / Funding Fee Arbitrage

This "spot - perpetual basis / funding fee" arbitrage is a common technique used by market makers, market-neutral funds, quantitative traders, and arbitrageurs. Retail investors can also participate, but with smaller volumes, higher rates, and borrowing costs, the advantages are not obvious.

The "benefit" it captures has only two essential sources: the first is the funding rate. When the perpetual price is higher than the spot price and the funding is positive, longs must pay "interest" to shorts periodically—you can do "long spot + short perpetual" to collect this interest; conversely, when the funding is negative, you can do "short spot + long perpetual," with shorts paying longs. This way, your net exposure is close to zero, and the funding fee acts like a savings interest, rolling over within a certain time period, capturing cash flow from "emotional premiums / pessimistic discounts."

The second source is basis convergence. When a project launches or during emotional fluctuations, there may be a one-time premium or discount of the perpetual relative to the spot; as emotions cool and market makers restore balance, the perpetual will converge towards the spot/index price, allowing you to pocket the one-time profit from "narrowing the price difference" within your hedging structure. Combined, this results in a "interest + convergence" combination, from which you subtract borrowing costs, fees, and slippage to get the net profit.

However, it is crucial to understand the clearing mechanisms, slippage, fees, funding rate settlement times, and trading depths of different trading platforms to prevent XPL short squeeze events.

Additionally, in the most common "long spot + short perpetual" strategy, you can also find some vaults with relatively high annualized returns, such as StakeStone and Lista DAO's vaults, which have over 40% APY after subsidies.

4. LP + Short Hedge Arbitrage

Simply forming an LP is not arbitrage; it is more like "exchanging directional risk for fees." However, if you add a short hedge, leaving only the net profit curve of "fees - funding fees / borrowing interest - rebalancing costs," it is also a good hedging idea.

The most common structure is to provide concentrated liquidity on-chain (such as WLFI/USDC or WLFI/ETH pools) while shorting an equivalent nominal value of WLFI perpetuals on an exchange; if there are no perpetuals, you can borrow coins in a margin account to sell spot, but the friction will be greater. The purpose of this approach is simply to avoid betting on price movements and focus entirely on "the more transactions, the thicker the fees."

When executing, treat the LP as a "fee-generating market-making range." First, choose a fee rate and price range that you can monitor, such as a 0.3% or 1% fee tier for new coins, setting the range close to the current price with a "medium width." After deployment, part of the LP position will become WLFI spot, and part will be stablecoins; you use the "nominal equivalent" of this WLFI to open a short perpetual, initially aligning the dollar value of both legs. As the price fluctuates within the range, the on-chain leg earns fees through turnover and captures a bit of price difference through passive rebalancing; the direction is borne by the short leg, creating a net neutral position. If the funding fee is positive at this time, your short leg can also earn additional interest; if the funding fee is negative, you need to rely on a wider range, lower leverage, and less frequent re-hedging to maintain net profits.

The difference from basis arbitrage is that basis arbitrage captures the price difference convergence between "perpetual and spot" and funding fees, while here it captures the fees generated by on-chain turnover. The difference from pure LP is that pure LP's profit and loss largely depend on direction and impermanent loss.

WLFI Coin Stock ALTS and WLFI Hedging

ALT5 Sigma (Nasdaq: ALTS) raised about $1.5 billion through stock issuance and private placements, part of which was directly exchanged for WLFI tokens, while another part was used to allocate WLFI in the secondary market, thus positioning itself as a "vault/agent exposure" holding WLFI. For more reading on WLFI coin stock ALT5 Sigma (Nasdaq: ALTS), see: "If you dare not buy tokens, is there still an opportunity with WLFI coin stock?"

At the same time, observe the price movements of ALTS and WLFI; logically, short the stronger side and long the weaker side, waiting for it to return to normal to close the hedge. For example, if WLFI rises first due to its listing and narrative push, while ALTS is "lagging" due to constraints from US stock trading hours or borrowing costs, the price difference will widen; when US stock trading opens and funds fill ALTS's "agent exposure," this gap will revert.

If you use WLFI perpetuals to hedge, you may also earn funding fees, but the main profit still comes from the price difference itself, rather than a one-sided direction.

The difference from the previous "basis/funding fee arbitrage" is that there is no certainty anchor of "spot - perpetual" here; instead, stocks are treated as a "shadow" holding WLFI, with the logic resembling the old idea of "BTC and MSTR," but the execution difficulty lies in friction and timing. The crypto side trades 24/7, WLFI unlocks at 8 AM, but Nasdaq opens at 9:30 AM. If you buy or sell before this, it is pre-market trading, which can place orders and match trades, but the matching rules differ from regular trading, and you also need to be aware of the possibility of halts or circuit breakers.

WLFI Market Cap Bets on Polymarket

Currently, there are two bets on WLFI on Polymarket, both concerning the market cap on the day WLFI launches. One is a tiered market (with options like $10B, $10–12B…,$>16B), and the second is a threshold market (with options like $>13B, $>20B, $>35B as three binary judgments).

Since both are asking about "the FDV of WLFI one day after launch," their prices must be consistent with each other: the sum of probabilities in the tiered market must equal 100%. Therefore, the price for the tier "$>16B" in the tiered market must match the probability P(>16B) in the threshold market.

At the same time, the sum of prices in its complement in the tiered market ($10B, $10–12B, $12–14B, $14–16B) must equal 1 - P(>16B) in the threshold market. If you find an imbalance, for example, if the price for "$>16B" is very high in the tiered market, but the total of the four tiers is also not low, leading to "$>16B + the other four tiers" clearly exceeding 1, you can place a sell order on the expensive side or hedge with "No," while buying up the cheaper side to create a "guaranteed $1 basket with cost <1"; if the total is less than 1, then directly buy up both sides to lock in the difference.

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