What Is 'Spoofing' and How Does It Differ from Front-Running? ⎊ Path

What Is ‘Spoofing’ and How Does It Differ from Front-Running?

Spoofing is a manipulative trading practice where a trader places a large order with the intent to cancel it before execution, creating a false impression of supply or demand to influence the price. Front-running, in contrast, involves executing a trade based on non-public information about another genuine, impending trade.

Spoofing manipulates the market perception; front-running exploits knowledge of a real order. Spoofing is also illegal.

What Are ‘Spoofing’ and ‘Layering’ and Why Are They Considered Market Manipulation?

How Does ‘Spoofing’ or ‘Wash Trading’ Distort the Perception of Volume and Spread?

How Does ‘Order Book Spoofing’ by Some HFTs Distort the Perceived Bid-Offer Spread and Liquidity?

How Does Spoofing Differ Legally from a Legitimate Market-Making Strategy?

How Does “Spoofing” by HFT Firms Artificially Affect the Perceived Order Book Depth?

How Does an ‘Immediate or Cancel’ (IOC) Order Differ from a ‘Fill or Kill’ (FOK) Order?

How Does an exchange’S’matching Engine’ Process Different Types of Orders?

How Does the SEC Define Insider Trading in the Context of Crypto Assets?

Glossar

Spoofing

Action ⎊ Spoofing, within cryptocurrency derivatives and options markets, represents a deceptive trading practice involving the placement of orders intended to create a false impression of market activity or interest, without the actual intention to execute those orders.