[anonymoushn]

Day traders mostly don't even have access to real-time L2 market data, so they mostly can't be harmed by spoofing.

The harmed parties are algorithmic traders that use L2 market data to adjust their theoretical value.

[arcticbull]

I assume L2 in this context means level 2 and not layer 2?

[gpderetta]

yes, full depth (or at least multiple price levels), as opposed to L1, i.e. just top of book. L3 would be order-by-order.