Lowish Latency Crypto Trading

Low(ish) latency crypto Smart quant crypto traders will spin up many thousands of EC2 instances, measure latency to the exchange, and only keep the best instances, continually. This process allows them to eventually get EC2 instances to trade from probably in the same rack, or maybe on the same bare metal box, as the exchange. This is pretty good going. Traffic will still be routed through some sort of overlay network, but everyone has that penalty. There are no large upfront costs to setting up a strategy and market data is free.

A minimalist text screenshot explains how crypto traders could repeatedly launch EC2 instances until they find one with unusually low latency to an exchange. The joke is the absurdly optimistic idea that cloud infrastructure can approach co-located bare-metal trading while avoiding the usual costs of high-frequency trading.

• @jemalloc / 1556 2024-04-16