High-Frequency Trading (HFT): High-Speed Trading

1. What is High-Frequency Trading (HFT)?

HFT involves using complex algorithms to execute trades in extremely short timeframes. In the crypto market, HFT accounts for a significant portion of trading volume on major exchanges, playing a crucial role in liquidity provision and price adjustment.

2. How It Works and Technological Requirements

Implementing HFT requires specialized computer systems, high-speed internet connections, and access to real-time data. Operating an HFT system can cost millions of USD annually, covering hardware, software, data, and skilled personnel.

3. Who Can Participate in HFT?

HFT is primarily conducted by large financial institutions due to high technological and financial barriers. However, with technological advancements, individual traders can participate through platforms offering automated trading services and simplified HFT algorithms, though with limited efficiency and speed compared to professional systems.