A Case Study in Finding Edge

In 2021, James, I, and a small team decided to set up a crypto trading venture.

We faced several problems, but knowing almost nothing about crypto was the most significant.

We sensed that the fractured, developing nature of the crypto market would likely be a good place to seek out inefficiencies, but beyond that, we were winging it.

That turned out to be very true – inefficiencies abounded in crypto at the time. We quickly found ourselves a niche doing futures basis arbitrage. But when that started to dry up, there was no shortage of other opportunities to get after.

We traded various edges, from on-chain latency arbitrage to leveraged yield farming.

But we also learned a bunch of meta-lessons about trading generally, including how to approach a market you know very little about, and the importance of trying to make money every day and what this means for prioritising your work.

Last week, James sat down for a Youtube conversation about this period in our trading journey. He discusses these important meta-lessons and describes nine of the edges we traded. Check it out below.

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