HFT Spoofing

HFT spoofing is an illegal or unethical market manipulation tactic where a high-frequency trader places a large volume of orders with no intention of executing them. The goal is to create a false impression of supply or demand to trick other market participants into trading at unfavorable prices.

Once the market reacts to the fake order, the spoofing entity cancels the orders and executes their real position on the opposite side. This distorts price discovery and damages market integrity.

Regulators closely monitor order cancellation rates to detect and penalize this type of deceptive activity in digital asset markets.