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by crzwdjk 2904 days ago
The microsecond level competition comes from the fact that the HFTs can't compete on price below one cent, because the minimum quote increment is one cent. So they have to compete with each other on speed. There have been proposals to allow sub-penny quotes, and thus let the HFTs compete more on price and possibly bring spreads down even further, but those proposals don't seem to have gone anywhere.