Order Book Spam

[akreider]

Users are intentionally spamming the order book with orders as small as 10 so as to manipulate the price. This is due to the asymmetry where it is free to place an order, but costs money to match it. This is killing liquidity.

One method is to place your offer to sell at 0.90 (say 10k shares), and then place a bid for 10 shares (or why not 100 bids for 10 shares) at 0.899 to make it very expensive for anyone to under-cut your price.

One possible fix is to let users choose to ignore small orders. Another possible fix is to require that the minimum order size be $250 DAI (so 500 at 0.50 or 5000 at 0.05) or larger.

For that matter, a competitor might decide to attack the order book and render it useless.