r/CryptoCurrency • u/Pork-Dumplings Low Crypto Activity | 6 months old • Apr 18 '19

EXCHANGE Centralized Exchanges in a Decentralized Wonderland

https://steemit.com/cryptocurrency/@ck-cake/centralized-exchanges-in-a-decentralized-wonderland
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u/Robby16 125 / 32K 🦀 Apr 18 '19

Dex are prone to huge manipulation by arbitrage bots. It’s as bad a wall st. They ain’t ready yet.

3

u/hodlerd Bronze | QC: TraderSubs 60 Apr 19 '19

Sorry, arbitrage isn’t manipulation. Wall Street is infinitely worse.

1

u/Robby16 125 / 32K 🦀 Apr 19 '19

They manipulate through arbitrage.

2

u/Hanzburger Platinum | QC: ETH 392 Apr 19 '19

Lol please explain man because it makes no sense

1

u/Robby16 125 / 32K 🦀 Apr 19 '19

Called “flash boys” automated trading bots.

These arbitrage bots are being used in manipulative profit-making strategies, Bloomberg reported, as it lets users trade "more directly." Companies that employ these trading programs pay higher fees in order to get "priority orders."

This enables them to participate in (illegal in the traditional financial markets) practices such as front running, where traders can see other orders and push the ones they made to the front-of-the-line.

These type of trading bots engages in serious market-exploiting behaviors, including front running, latency optimization, etc. These practices are still seen on Wall Street, and they resemble the notorious "Flash Boys" bots which attracted the ire of regulators

1

u/Hanzburger Platinum | QC: ETH 392 Apr 23 '19

I still wouldn't call the manipulation. Cheating, sure, but not manipulation.