[w4llstr33t]

> As you learn more about crypto and traditional finance, it'll be fun to compare the two. Your confusion about the role of an exchange in traditional finance might be because you see the crypto world, where a single entity often performs the roles that many entities perform in traditional finance (exchange, clearing firm, broker, etc.).

Yes, I agree!

In terms of what I called antiquated technology, I think there are a lot of layers on traditional finance, and a lot has changed since its beginnings. I think crypto will go through a similar evolution, in terms of tech, regulation, etc. I think we're in the very early stages for crypto and it has a chance to be an even better system.

I do know that HFTs exist in crypto, and it still is the wild west in some ways, but in the end I like that innovation is happening and that there are alternatives to existing systems.

That said, I appreciate all the responses and I'll take some time to learn more about traditional markets.

[vgatherps]

Crypto volume is pretty hft/market maker weighted as well.

There’s just not

a. Enough random interested parties willing to buy/sell various coins so that you have low-spread and liquid markets

b. Non-hft players who keep crypto markets in line with each other

This isn’t super surprising. Managing posted liquidity is a difficult task that sort of requires being halfway to a market maker, and naturally most non-market makers just want to buy and sell right away instead of posting orders and waiting/hoping.

The result of this is that most liquidity is provided by HFTs, since they’re the only party that can and even wants to have a bunch of bids/offers out for you to trade against.