Hacker News new | ask | show | jobs
by Prunkton 725 days ago
to give some examples:

- you can trade crypto 24/7, this sounds obvious but on the other hand side this also means, there is no pre-market trading and all the obscure things attacked to it

- before blocks are being created, transactions are usually collected in so called mempools. (Way oversimplified) block proposers or miners, who are selected to create the next block, can choose which transactions to include, as space is limited. They can also determine the order of these transactions. All of this is publicly visible and opens a lot of opportunities to harvest slippage etc. (lookup MEV-bots)

- generally speaking, there is no robin hood or other intermediary, that can block you from trading

- in crypto, you essentially have access to all available financial products without any barriers to entry compared to traditional finance

it looks like this repository is using Binance APIs for trading. So my statements are no entirely true for this case. But you can use trading bots like this on decentralized exchanges or DeFi products like curve finance without being dependent of an intermediary

3 comments

> All of this is publicly visible and opens a lot of opportunities to harvest slippage etc. (lookup MEV-bots)

Basically, people can front-run your trades, and this is built into the market by design. Also, instead of the winner being the fastest like in tradfi, there is a competitive auction where participants pay for priority. See, e.g., https://archive.ph/W0nvi or pages 7...9 of https://assets.ey.com/content/dam/ey-sites/ey-com/en_us/topi... for examples. Even if you are not the one doing the front-running, you have to be aware that someone else will be.

To make it more exciting there are also implementation bugs: https://archive.ph/9w32t

HFT on chain is a funny concept. 1.5 milliHertz, and the trading fees would wipe you out.
I'm not into crypto, but I imagine it is possible to trade on exchanges with regards to price movements without trading on the chain directly. This is either a good thing (higher volumes at higher transaction speeds), or creates the exact thing crypto is meant to avoid (see: FTX).
Yes, you can trade crypto 24/7 - in theory, because liquidity is muuuch lower outside the regular daily hours

In crypto, you have only two assets - BTC and ETH, all other assets are not tradeable because of volume/liquidity, sure you can & sell them, but most trading strategies wont work well in underliquid markets

This seems off. Sufficient liquidity in a market isn't natively a binary state. That state would be imposed by the programmer with a threshold. Hardcoding only two assets would surely miss dynamic opportunities in others.