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> "a limit order matching policy" is a feature of all exchanges Not maker/taker exchanges, including GDAX (Coinbase's exchange)... Check it out. > Actually, m

by lend000 10y ago

> "a limit order matching policy" is a feature of all exchanges Not maker/taker exchanges, including GDAX (Coinbase's exchange)... Check it out. > Actually, markets don't work without limit orders and a limit order matching policy; market orders don't have anything to set a price for them without limit orders. Also true, and not at odds with my point. They are symbiotic in a maker/taker model. Not saying anything about whether it's a good model, but here it is for everyone's edification: http://www.marketswiki.com/wiki/Maker-taker http://www.marketswiki.com/wiki/Maker-taker

dragonwriter 10y ago
> Not maker/taker exchanges, including GDAX (Coinbase's exchange)... Check it out. GDAX has immediate-or-cancel limit orders, and it's market orders are only immediate-or-cancel, so it has to match incoming limit orders against the limit order book with a limit order matching policy. Which, unsurprisingly, it has. [0] Maker/Taker just mean fees go from aggressor orders to the orders on the book they are matched with; to enable market makers to optimize their operations in this environment, for instance, GDAX has a Post-only limit order type that is basically an inverted Fill-or-Kill limit order where if any part of the order would match an order on the book (which requires limit order matching!), the entire order is cancelled. You could use maker/taker pricing on an exchange where limit orders were effectively all the equivalent of GDAX's Post-only (so, makers) and takers had to be market orders, but, that'd be a pretty horrid market for takers, and outside of a monopoly with a strong moat on the commodity pair(s) being traded, I'd expect actual trade to migrate to more sanely-structured venues. [0] the policy is summarized: https://support.gdax.com/customer/en/portal/articles/2429575-order-matching-and-price-determination https://support.gdax.com/customer/en/portal/articles/2429575... (it seems to be fairly standard price/time priority with price set by the order on the book.)
- lend000 10y ago
  Didn't realize GDAX supported taker limit orders by de-selecting "Post Only" -- definitely a nice feature along the lines you're describing, adding a bit of slippage safety: https://support.gdax.com/customer/en/portal/articles/2426596-entering-market-limit-and-stop-orders https://support.gdax.com/customer/en/portal/articles/2426596...
evanpw 10y ago
Market orders are not the same as marketable orders. Market orders are instructions to buy or sell regardless of price. They're dangerous because in a sudden price move you may get a bad price (e.g., in a flash crash you may sell a $100 stock for 1 cent). A marketable order is any order for which there's a resting order on the opposite side that can execute against it. Market orders are by definition marketable (unless there are no orders at all), but limit orders can also be marketable (e.g., if someone is bidding $10, and you send a limit order to sell at $9.99, that's marketable). An exchange can function perfectly well without market orders (you just always have to specify a price), but not without marketable ones.

by lend000 10y ago

dragonwriter 10y ago

> Not maker/taker exchanges, including GDAX (Coinbase's exchange)... Check it out. GDAX has immediate-or-cancel limit orders, and it's market orders are only immediate-or-cancel, so it has to match incoming limit orders against the limit order book with a limit order matching policy. Which, unsurprisingly, it has. [0] Maker/Taker just mean fees go from aggressor orders to the orders on the book they are matched with; to enable market makers to optimize their operations in this environment, for instance, GDAX has a Post-only limit order type that is basically an inverted Fill-or-Kill limit order where if any part of the order would match an order on the book (which requires limit order matching!), the entire order is cancelled. You could use maker/taker pricing on an exchange where limit orders were effectively all the equivalent of GDAX's Post-only (so, makers) and takers had to be market orders, but, that'd be a pretty horrid market for takers, and outside of a monopoly with a strong moat on the commodity pair(s) being traded, I'd expect actual trade to migrate to more sanely-structured venues. [0] the policy is summarized: https://support.gdax.com/customer/en/portal/articles/2429575-order-matching-and-price-determination https://support.gdax.com/customer/en/portal/articles/2429575... (it seems to be fairly standard price/time priority with price set by the order on the book.)

lend000 10y ago
Didn't realize GDAX supported taker limit orders by de-selecting "Post Only" -- definitely a nice feature along the lines you're describing, adding a bit of slippage safety: https://support.gdax.com/customer/en/portal/articles/2426596-entering-market-limit-and-stop-orders https://support.gdax.com/customer/en/portal/articles/2426596...

evanpw 10y ago

Market orders are not the same as marketable orders. Market orders are instructions to buy or sell regardless of price. They're dangerous because in a sudden price move you may get a bad price (e.g., in a flash crash you may sell a $100 stock for 1 cent). A marketable order is any order for which there's a resting order on the opposite side that can execute against it. Market orders are by definition marketable (unless there are no orders at all), but limit orders can also be marketable (e.g., if someone is bidding $10, and you send a limit order to sell at $9.99, that's marketable). An exchange can function perfectly well without market orders (you just always have to specify a price), but not without marketable ones.