coindesk.com
Tron's native token ($TRX) traded at a premium of up to 17% over the weekend on the recently hacked exchange Poloniex, creating a potentially lucrative arbitrage trade.
The premium has since shrunk to around 7%, with $TRX trading at $0.10561 on Binance and $0.11005 on Poloniex, according to exchange data.
An arbitrage trade involves buying an asset on one venue and simultaneously selling it for a higher price on another. Traders take on an element of counterparty risk as they need to ensure capital can eventually flow between both venues.
Poloniex was hacked for more than $114 million last month, an event that prompted the exchange to temporarily freeze deposits and withdrawals.
Tron founder Justin Sun told CoinDesk on Monday that "$TRX withdrawals are open," despite the asset trading at a premium on Poloniex.
The trade-off with scooping up cheap $TRX on Binance and selling it at a higher price on Poloniex is that certain assets are still locked from being withdrawn. Poloniex said that it has deployed "a phased approach" to withdrawals starting with $TRX, which will be followed by bitcoin (BTC), ether (ETH) and tether (USDT) over the coming weeks.
As a result, traders would have to hold assets on Poloniex they are available to withdraw.