> Without such a cap it's an arms race that adds no value. I have seen nobody ever challenge the value of liquidity in these discussions of HFT. Assuming this,

> Without such a cap it's an arms race that adds no value. I have seen nobody ever challenge the value of liquidity in these discussions of HFT. Assuming this, the argument is that at some amount of latency the additional liquidity turns into a negative. It seems more like the additional value is simply extremely small, but meaningful over an entire market. What's the exact cutoff point for the value of additional liquidity turning negative, and will anyone agree on that arbitrary number? Assuming HFT does turn into a negative at some point, wouldn't the same apply to optimizations in other markets like online advertising? If it does apply elsewhere, we should also legislate away the practice of making online advertising more efficient to prevent tech giants like Google and Facebook from wasting billions of dollars and untold man-hours on these activities that are clearly worthless to society.