Thanks @Phyrex_Ni for the discussion. Here's an example of an arbitrage process:
1. Identify a price difference for the same asset across different markets or exchanges.
2. Buy the asset at a lower price in one market.
3. Transfer the asset to another market where the price is higher.
4. Sell the asset at the higher price to realize a profit.
This process involves careful timing and transaction costs management to ensure profitability.

Thanks to @Phyrex_Ni for the discussion. Here’s an example of an arbitrage process:

1. A spot ETF IBIT experiences a fund liquidation, leading to大量卖出$IBIT, causing it to trade at a discount.

2. When the difference between (the stock price of $IBIT) and (the net asset value per share of $IBIT in BTC) reaches a certain threshold, arbitrageurs buy discounted $IBIT and sell BTC in the spot/futures market to profit from the discrepancy.

3. Selling BTC does not require market makers/arbitrageurs to hold BTC; they can borrow BTC to sell in the spot market or short BTC using futures contracts. As long as arbitrageurs have enough USD, they can sell sufficient BTC.

4. This process completes the transmission from $IBIT sales to BTC sales. For example, if a fund liquidation causes a 5% discount, equivalent to about 60,000 BTC worth of $IBIT, arbitrageurs buy all of it and simultaneously sell 60,000 BTC in the spot/futures markets.

5. Arbitrageurs wait for the $IBIT discount to recover, then sell $IBIT at the normal price and close the corresponding short positions. During this process, no $IBIT redemption for BTC occurs.

6. If the $IBIT discount remains prolonged or if arbitrageurs hold too much $IBIT, risking liquidity squeeze, they may redeem $IBIT for BTC and sell the spot BTC plus close the equivalent short positions.

Step 5 is the primary trading method for arbitrageurs; step 6 is a special case. For example, if a fund liquidates 60,000 BTC, perhaps 54,000 BTC are hedged away, leaving only 6,000 BTC to be redeemed through the spot market.