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by IshKebab 799 days ago
If you think about it you can never eliminate the advantage of being faster. If you do 5 seconds batches it just means the edges of the batches become the time-sensitive points.

If you want to kill HFT you can do it directly via very very small transaction fees. But guess how popular that is...
4 comments
bloak 799 days ago
> If you think about it you can never eliminate the advantage of being faster. If you do 5 seconds batches it just means the edges of the batches become the time-sensitive points.

You mean you can never completely eliminate the advantage? But mostly eliminating it might still be useful?

Suppose the rule is that if you get your request in by 01:23:45 then it gets handled in the following 5-second period and the response is sent out at 01:23:50. Does someone (A) who finalises their request at 01:23:44.9999 and gets the result back at 01:23:50.0001 have an advantage over someone else (B) who has to finalise their request by 01:23:44.8 and gets their result back at 01:23:50.2? Yes, certainly, but it doesn't seem to be much of an advantage ... So person A can take account of exciting news that arrives at 01:23:44.9, while person B can't, true, but when it comes to reacting to other trades, person A has 4.9998 seconds to think about the news, while person B has 4.6 seconds to think about it, which doesn't seem like a huge difference. Compared to how things work today.

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chardz 799 days ago
You can certainly alleviate the disadvantage of being slower though - and that’s exactly what literature in batch trading argues.
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xrd 799 days ago
It's funny that you say that, with the crypto transaction fees still a big problem. Feels like HFT and crypto are on a convergence towards that concern.
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gpderetta 798 days ago
Exchanges already extract per order commissions. You do not pay per message (so add, cancels and amends are free, you only pay when you get traded [1]).

A per-message would probably significantly affect existing strategies and greatly increase spreads, but I don't think it would prevent all forms of ULL trading.

[1] But even there exchanges offer rebates, if not outright incentives, for market makers to provide liquidity.

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