Press "Enter" to skip to content

From Hodl to HFT: Crypto’s new breed of traders are mimicking the Flash Boys of Wall Street- Bitfinex

Bitfinex, a state-of-the-art digital asset trading platform, has become a hub for a new generation of crypto traders deploying algorithms on the exchange’s Honey Framework to exploit rapid price fluctuations in bitcoin and other leading cryptocurrencies.

At the time of writing, Bitfinex has secured the top position in terms of providing worldwide liquidity $70,261,138 with a $113,364,874 (volume 24h) as per CoinMarketCap (CMC)- cryptocurrency data tracking website.

The term ‘Hodl’ — where a trader holds over the long term rather than seeking a quick profit — has long held parlance among cryptocurrency traders. Long term holders of crypto who opened accounts when Bitfinex launched in 2012 have had the opportunity to make huge returns. While Bitfinex remains a favored crypto trading venue among early investors in Bitcoin, a new generation of traders are deploying the tactics used by High-Frequency Traders (HFT) to execute strategies such as statistical arbitrage and volatility arbitrage. 

Bitfinex: Honey Framework

As per the information, Bitfinex’s Honey Framework functions as a powerful tool that spans across the programming languages NodeJS and Python, enabling users to create custom order types or event-driven automated trading strategies. The framework, which integrates natively into the Bitfinex trading platform, also allows traders to backtest market data to inform algorithmic trading strategies.

“In the last few years, we have seen an increased number of young professional traders,” said Paolo Ardoino, CTO at Bitfinex. “This has propelled exchanges to develop as advanced professional trading platforms. Now we will probably see 2020 and 2021 as the years where we move towards the sort of trading that you see on top traditional financial exchanges. These new types of tech-savvy crypto traders want to have a similar set up that you see in traditional financial markets. We are seeing a lot more interest in cryptocurrencies from young guys mimicking the ‘flash boys” of Wall Street.”

As the exchange with the most liquidity in Bitcoin and Ethereum, Bitfinex is the go-to place for this new generation of professional traders, Ardoino noted. 

CryptoCompare Review on Bitfines

According to CryptoCompare’s March Exchange Review, Bitfinex represented the majority of top-tier exchange trading volume across bitcoin/US Dollar (BTC/USD) and Bitcoin/Tether (BTC/USDT) markets during the period of bitcoin’s steep price drop.

The establishment had shown the underlying strength and depth of liquidity on March 12/13 over 24 hours period when the price of bitcoin plummeted by 50 percent. 

Bitfinex Founded in 2012, Bitfinex cryptocurrency exchange facilitates in three areas: crypto-fiat, margin trading, and global liquidity provider. In addition to a suite of advanced trading features and charting tools, Bitfinex provides access to peer-to-peer financing, an OTC market, and financed trading for a wide selection of digital assets. Bitfinex’s strategy focuses on providing unparalleled support, tools, and innovation for experienced traders and liquidity providers around the world. 

However, due to the wild and unpredictable nature of cryptocurrencies, the experienced forex traders also see a low leverage ratio on their trades.