15-Minute Crypto Market Arbitrage

This strategy exploits price discrepancies between related 15-minute expiration crypto markets (e.g., BTC/ETH up/down) on Polymarket. It uses the Gamma API to monitor real-time order books across multiple outcome pairs, identifying instances where the sum of implied probabilities for complementary outcomes deviates from 1. When a gap is found, the bot executes paired trades — buying the undervalued outcome and selling the overvalued one — to lock in a risk-free spread. Entry is triggered when the hedge threshold (e.g., 2% expected return) is met. Exit occurs at expiration or earlier if the gap closes. The bot includes integrated risk management to cap per-trade exposure and avoid liquidation during volatile periods. Implemented in TypeScript, it runs as a continuous loop with sub-second polling and uses WebSocket feeds for low-latency execution. Backtests show consistent small-margin profits with high Sharpe ratio.