Tinfoil hat off!
Shouldn't an exchange be able to handle volume? Seems like a basic requirement.
Regardless, I still believe that with the introduction of shorts, were going to see bigger swings.
Shouldn't an exchange be able to handle volume? Seems like a basic requirement.
Regardless, I still believe that with the introduction of shorts, were going to see bigger swings.
Exchanges have incentive to handle as much volume as possible to make as much via fees as possible, but no site can handle infinite volume. The coinbase app has been climbing the iTunes charts into the top 20 the last couple days. Just before the site went down the price was running up by hundreds of dollars per minute, attracting tons of trader traffic trying to profit from it. Even if they have basic scaling measures in place for the basic infrastructure, they most likely experienced unprecedented exponentially increasing volume that was inevitably bound to break something
I've seen exchanges running 10 or 100 times that amount with no problem, ran by only a couple of graduates out of school.
Either way, doesn't matter. Exchanges have no performance problem, it's a big queue, you just queue requests.
They're not all shitty me-too Rails apps built by junior engineers who figured "how hard can it be?". But most of the ones I've seen are.
Exchanges are just websites like any other. They're build to handle a certain amount of traffic based on the average amount plus a little extra to handle spikes.
If they only get (And I'm pulling numbers out of my ass here just to make a point) an average of 10 trades per second with occasional spikes to 100 trades per second, how much infrastructure should they build? What capacity should they build to? 1,000 trades per second? 10,000?
There's a cost analysis involved. I think it's a bit unrealistic for them to have enough infrastructure to handle spikes an order of magnitude higher than their typical peak loads.
I'm sure as they grow they'll harden their systems and/or do a total rewrite. In fact I wouldn't be surprised if they're doing it already since the big boys are starting to show interest with futures.
But what levels of volume? 100 quadrillion trades per nanosecond? Sure they could scale their infrastructure to those levels, but why? You overprovision, get estimate your worst-case scenario and work towards that. But in the end, if there is a huge rush, like a 10000% increase or more, even the largest exchanges would break down.