Moshe

a couple thoughts from a former high frequency trader: 1. Good market makers made a killing yesterday. Profit is correlated to volatility and volume. And it’s non-linear: profit increases dramatically with vol. 2. Market makers like @wintermute_t, @jump_ are the reason why there is even liquidity to trade at all. Liquidity provisioning is not an easy job. Do you want to take the opposite side of every trade? Especially, in the insider-trading heavy world of crypto? 3. A question I keep seeing: How does the market go down if no one is selling? This is a fundamental misunderstanding of how markets work. If there are no bids, the asset price goes immediately to 0. No one has to sell, you just have to run out of buyers. 4. Not all market makers are created equal. There are many crypto trading firms that label themselves as “market makers”, but in fact they act more like OTC desks. Market making means placing bids and offers to provide liquidity to markets while remaining delta neutral. Anyone who is not doing this, but calling themselves a market maker is lying. 5. A question I’ve been pondering: Is it possible to implement circuit breakers in crypto? When a US stock falls 7% in a day it enters into a 15 minute trading halt. This is possible because there are only so many US stock exchanges (centralized). This prevents stocks from cratering to 0 and allows liquidity to come in on the bid side. Unclear to me how this is possible without centralization. You can’t be the one exchange that pauses trading.