Iceberg Orders

An iceberg order is a large, hidden limit order that is split into smaller, visible portions to minimize market impact. Only a small fraction of the total order size is displayed in the order book, while the remainder stays hidden until the visible portion is executed.

This technique allows traders to accumulate or liquidate large positions without signaling their intentions to the rest of the market, which could otherwise lead to adverse price movements. Iceberg orders are a common tool for institutional traders and large retail participants in both traditional and crypto markets.

They help manage market impact by preventing the order from being seen as a large, singular block that might trigger stop-loss orders or attract predatory trading. Effectively using iceberg orders requires a balance between the visible portion size and the total order size to maintain anonymity while ensuring timely execution.