San Fransico based cryptocurrency exchange Coinbase has announced a new market structure for its trading platform Coinbase Pro.
Coinbase Pro to Change Things
Revealed in a recent blog post, the changes are designed to help increase liquidity, enhance smoother price movements, and ensure price discovery.
According to the blog post, this new change in structure will include a new fee structure, reportedly designed to increase liquidity, updated order maximums, new order increment sizes, the turning off of stop market orders and added market order protection points.
Also, Coinbase Pro and Coinbase Prime will no longer take stop market orders. As a result of this, all stop orders will henceforth be submitted as limit orders and include a limit price.
Also, the newly introduced market protection point for both Coinbase Prime and Coinbase Pro users will be a total of 10 percent for all market orders.
It was further explained that market orders that move the price more than 10 per cent will stop executing and return a partial fill.
Importantly, the blog post from the exchange issues a warning that the platforms will be offline on March 22 from 6:00 p.m. to 6:30 p.m. PDT. During this period, the platform will not be accessible.
Change Met With Negativity
Just as expected this change in policy has been met with great, scepticism and negativity from the crypto community on social media.
For example, Economist and trader Alex Krüger complained on Twitter about it.
He stated that:“Coinbase Pro raising fees for smaller clients by 33% while lowering fees for larger clients.” Krüger continued that “in a rational world, most Coinbase users would now move to Binance.”
Krüger went further to question the exchange decision to disable stop market orders, claiming that stop-limit orders sometimes fail to execute because of slippage, suggesting using far off limits on limit orders as a workaround.
On a more positive note, Krüger, however, admitted that these changes will surely lead to an increase in liquidity and trading activity.