High frequency trading (HFT) is simply trading done on a VERY short time scale (sometimes milliseconds)
by computers. One of the main tactics behind HFT is having powerful datacenters
in close proximity to stock exchanges, central banks, etc.
Despite the fact that HFT makes up a lot of the trading volume
in stocks and forex, there's nothing magical about HFT.
HFT strategies and algorithms are numerous. Many HFT firms
lose money, and price action is not noticeably affected or any
different than it was years ago before HFT.
HFT operates on the smallest timeframes, and
thus generally requires direct market access with
the narrowest of spreads.
There may be algorithmic trading going on with Bitcoin,
but there is not enough depth/liquidity for it to be
really in the same class as what is considered HFT today.
The exchanges themselves are probably using their own
trading algos inside their own platforms
(and that could be called "insider" trading I suppose)
although that is to be expected.
I knew what HFT was in the real market, but we know that the BTC market is not the same, even though I have heard there are "Centralized" exchanges showing up on the map in the real world. Sucks seeing something decentralized become manipulated by centralized influences.
But thanks for the reply!
