[olalonde]

There are also trivial technical solutions to this. Make orders non-cancellable for a certain period of time, throttle cancellation rate, etc. Any crypto exchange could implement this and win market share if it is really a feature that traders want.

[murbard2]

One solution which should be on the table is to not prevent it, at which point people stop looking at order book imbalance or volume as a signal. The fundamental question is what is lost if there's no signal in order book data. Does it hurt price formation? Does it hurt liquidity? All of these are empirical questions. You also have to compare it not to the scenario where everyone abides by anti spoofing rules, but one in which compliance is imperfect (as evidenced by this article). There are defenses against market manipulation, but they can run afoul of the very rules against it, which leaves law abiding actors vulnerable. It's not clear at all that the current equilibrium is the right one, but sadly the discourse is rarely around the rules most conducive to liquidity, it generally starts with the premise that any kind of strategic order placement is inherently deceptive and wrong.

[anonymoushn]

If I can't cancel I must quote wider, just like how if I can't be sure the exchange will even be up during volatility then I can't go 3x long futures at one venue and 3x short at another.

[fnordfnordfnord]

>Make orders non-cancellable for a certain period of time,

Exactly, in a similar manner that the PDT 4 trades in 5 days rule is implemented.