Execution Layer

Execution with Public Liquidity

Arbix utilizes public liquidity for its arbitrage operations. Users can deposit their assets into Arbix’s multi-chain liquidity pools, where these assets are then used to executeAll arbitrage opportunities. By pooling liquidity from multiple users, Arbix can execute larger and more profitable arbitrage trades, benefiting all participants.

This approach democratizes access to arbitrage profits, allowing users to earn returns without needing to navigate the technical complexities of arbitrage themselves.

Liquidity Pools

Arbix has the following liquidity pool types available for its operations:

• Multi-Chain Liquidity Pools. Arbix leverages multi-chain liquidity pools to facilitate the execution of on-chain & cross-chain arbitrage opportunities. Multi-chain liquidity pools mean that pools of the same assets exist on different chains;

• CEX Liquidity Pools. Liquidity pools available on integrated CEXs for CEX-DEX arbitrage.

To ensure that users continue to benefit from high annual returns (APRs), all liquidity pools will have a maximum cap.

Execution Types

There are several types of execution types based on: operational aspect and environments.

There are two execution types available from the operational aspect:

• Sequential Execution. Conducting arbitrage opportunities through sequential trades within a single block. This method executes one trade after another in a defined order, ensuring that each step is completed before moving on to the next. This approach is particularly useful for on-chain and triangular arbitrages where the sequence of trades must be tightly controlled to ensure the desired outcome;

• Parallel Execution. Simultaneously conducting on-chain and cross-chain arbitrage opportunities across single or multiple chains. This method allows for the execution of multiple trades at the same time by different pools. Parallel execution is especially effective for complex arbitrage strategies that involve multiple chains or require rapid execution to capture fleeting price discrepancies.

We can also classify executions on the basis of various environments:

• On-Chain. Executing arbitrage opportunities entirely within a single blockchain network;

• Cross-Chain. Executing arbitrage opportunities across different blockchain networks;

• CEX-DEX. Conducting arbitrage between centralized exchanges (CEX) and decentralized exchanges (DEX).

Execution types reflect the arbitrage types used by the Aggregation & Analysis Layer in planning operations.

Arbitrage Type	Execution Type	Leveraging
Simple On-Chain	On-Chain Parallel	Liquidity Pools on single Chain
Cross-Chain	Cross-Chain Parallel	Liquidity Pools on two Chains
Triangular	On-Chain/Cross-Chain Parallel/Sequential	Liquidity Pools on single/two/three Chains
CEX-DEX	Cross-Exchange Parallel	Liquidity Pools on-chain and CEX liquidity pool
Market Making	Orders Placement	Liquidity Pools on-chain and CEX liquidity pool

Cross-Chain Arbitrage via Lightning Execution with Multi-Chain Pools

One of the standout features of Arbix is its ability to perform efficient cross-chain arbitrage, offering the community a unique opportunity to capitalize on market inefficiencies across multiple blockchain networks.

Cross-chain arbitrage is typically out of reach for most arbitrage participants, especially regular users, due to the significant challenges it presents. These challenges include the need for (i) sufficient liquidity across multiple operational chains (more chains mean more opportunities, but also require more liquidity), (ii) constant rebalancing of operational funds, and (iii) a more complex and costly infrastructure. Bridging liquidity between chains is often impractical as it introduces time delays, additional costs, and increased risks.

Arbix addresses these challenges by leveraging public liquidity in multi-chain pools. This approach ensures that sufficient liquidity is always available on the necessary operational chains. Additionally, Arbix's advanced technologies enable efficient rebalancing of liquidity pools, reducing both the complexity and costs associated with the required infrastructure.

Given that speed of execution is critical in arbitrage, Arbix utilizes public liquidity across multiple chains within the Arbix Multi-Chain Liquidity Pool to perform parallel execution. This means that arbitrage transactions are executed simultaneously on different chains, with operational liquidity allocated on each respective chain. This approach enables lightning-fast execution, giving Arbix a significant edge in the market.

After the trades are executed, users' assets are dynamically allocated to the most profitable opportunities and are then softly rebalanced back to their source pools. This process maximizes returns while minimizing risks, ensuring that users benefit from optimal arbitrage conditions.