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Markets: Market Structure

What Is Price Discovery?Price discovery is the process by which markets turn scattered beliefs, information, and urgency to trade into a usable price

What Is Price Discovery?Price discovery is the process by which markets turn scattered beliefs, information, and urgency to trade into a usable price. It sounds simple, but the hard part is not producing *a* price — it is producing one that quickly absorbs new information without being too easy to distort.Mar 22, 202625 min read

#MARKET STRUCTURE

What Is 24/7 Trading?24/7 trading sounds simple: keep the market open all the time

What Is 24/7 Trading?24/7 trading sounds simple: keep the market open all the time. In practice, it changes far more than opening hours. It changes how prices are formed, how market data is published, how clearing assigns trade dates, and how exchanges manage risk when the rest of the market infrastructure still needs periodic resets.Mar 22, 202623 min read

#MARKET STRUCTURE

What Is an Onchain Order Book?An onchain order book tries to bring the familiar market logic of bids, asks, and price-time priority onto a blockchain itself

What Is an Onchain Order Book?An onchain order book tries to bring the familiar market logic of bids, asks, and price-time priority onto a blockchain itself. That sounds straightforward, but it changes the economics of matching, latency, fairness, and composability in ways that explain both the appeal and the difficulty of the design.Mar 22, 202621 min read

#MARKET STRUCTURE

What is Price Impact?Price impact is the cost of moving the market against yourself

What is Price Impact?Price impact is the cost of moving the market against yourself. When an order is large relative to available liquidity, the act of trading changes the price you get — whether by walking an order book or pushing an AMM along its pricing curve.Mar 21, 202623 min read

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What Is Spread?The spread looks simple: just the gap between a buy quote and a sell quote

What Is Spread?The spread looks simple: just the gap between a buy quote and a sell quote. But that small gap carries much of market structure inside it, because it is where liquidity, information risk, inventory risk, fees, and competition all show up in a single number.Mar 21, 202623 min read

#MARKET STRUCTURE

What is Volatility?Volatility looks like a simple idea—how much prices move—but markets use the same word for several different things

What is Volatility?Volatility looks like a simple idea—how much prices move—but markets use the same word for several different things. The crucial distinction is between volatility that has already happened, volatility traders infer from option prices, and volatility created or amplified by market structure itself.Mar 21, 202626 min read

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What is Market Capitalization?Market capitalization looks simple: price times shares or circulating supply

What is Market Capitalization?Market capitalization looks simple: price times shares or circulating supply. But that simplicity hides the real question investors care about — what kind of “value” this number measures, what it leaves out, and why markets organize so much around it anyway.Mar 21, 202626 min read

#MARKET STRUCTURE

What Is a Market Maker?A market maker solves a simple but difficult problem: how can buyers and sellers trade right now, even when a natural counterparty is not waiting on the other side? By continuously quoting both a buy price and a sell price, market makers turn immediacy into a service — and take on inventory, information, and technology risk in return

What Is a Market Maker?A market maker solves a simple but difficult problem: how can buyers and sellers trade right now, even when a natural counterparty is not waiting on the other side? By continuously quoting both a buy price and a sell price, market makers turn immediacy into a service — and take on inventory, information, and technology risk in return.Mar 21, 202621 min read

#MARKET STRUCTURE

What Is an Order Book?An order book is the machinery that turns scattered trading intentions into a live market price

What Is an Order Book?An order book is the machinery that turns scattered trading intentions into a live market price. It works because it preserves a simple rule — who is willing to trade, at what price, and in what priority — but that simple rule creates surprisingly rich behavior, from liquidity and slippage to queue position, auctions, and manipulation risks.Mar 21, 202626 min read

#MARKET STRUCTURE

What is Liquidity?Liquidity is what determines whether a quoted price is actually usable

What is Liquidity?Liquidity is what determines whether a quoted price is actually usable. A market can look active and still be fragile if modest size moves the price, depth vanishes, or replenishment slows when stress arrives.Mar 21, 202622 min read

#MARKET STRUCTURE

What Are Maker vs Taker Fees?Maker vs taker fees look like a simple pricing choice, but they quietly shape who posts quotes, who removes liquidity, and where brokers send orders

What Are Maker vs Taker Fees?Maker vs taker fees look like a simple pricing choice, but they quietly shape who posts quotes, who removes liquidity, and where brokers send orders. Once you see that a fee schedule can change routing incentives without changing the displayed price, much of modern market structure starts to make more sense.Mar 21, 202625 min read

#MARKET STRUCTURE

What is Depth of Market?Depth of Market shows how much visible buying and selling interest is waiting at different prices, not just the current best bid and ask

What is Depth of Market?Depth of Market shows how much visible buying and selling interest is waiting at different prices, not just the current best bid and ask. That extra context matters because prices move by consuming liquidity level by level, and the shape of that liquidity helps explain both execution cost and market fragility.Mar 21, 202623 min read

#MARKET STRUCTURE