Quote Generation Fairness is the principle ensuring that price quotes provided by liquidity providers or market makers in a cryptocurrency Request for Quote (RFQ) system are impartial, non-discriminatory, and accurately reflect prevailing market conditions. This principle prevents bias towards specific participants or against certain order characteristics.
Mechanism
Fairness is achieved through robust pricing algorithms that source data from multiple liquidity venues, apply consistent spread calculations, and update quotes dynamically based on real-time market data and internal risk parameters. The system architecture includes audit trails for quote derivations and mechanisms to detect preferential pricing or “last look” abuses.
Methodology
A framework for fair quote generation involves transparent policy enforcement for market makers, regular performance audits of pricing engines, and robust dispute resolution processes. The strategic approach emphasizes minimizing information asymmetry and ensuring that all participants receive competitive and equitable pricing for institutional options and block trades.
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