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Latency and transaction ordering on Hyperliquid | by Hyperliquid | Medium

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A well-designed exchange matches trades when both sides want to transact. Maximizing volume is a secondary goal. First and foremost buyers and sellers should both be happy with the price. This guiding principle applies to all markets: centralized or decentralized, CLOB/AMM/RFQ etc. For example, a user market buys on the UI and matches against the maker order with the lowest price. Both sides are happy. An order book sometimes satisfies the “well-designed” principle above. If someone has a resting buy order, that means they think the fair price is higher than the limit price, and are happy with a fill. The major exception is trades between HFT takers and HFT makers. The maker and taker have similar price preferences. Often the maker has sent the cancel request already, but the taker order is slightly faster and picks off the maker. It’s no longer win-win. This is why this HFT taker volume is often called “toxic flow.” Join Medium for free to get updates from this writer. Toxic flow hurt

Dex Defi Perps Trading Web3 Latency and transaction ordering on Hyperliquid Hyperliquid 3 min read · Jan 6, 2024 -- 2 Listen Share Press enter or click to view image in full size Some alpha for MMs and researchers: Hyperliquid L1 has a novel microstructure benefiting retail and makers over toxic takers Volume would be multiples higher without this design Hyperliquid is optimized for the end user, period. Not for VC metrics, fees, or HLP pnl Background A well-designed exchange matches trades when both sides want to transact. Maximizing volume is a secondary goal. First and foremost buyers and s

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