Order book

Petr notices an offer disappear from the book. That need not mean a sale: its owner may have canceled it. Coinbase therefore separates open-order data from actual trade messages. The book describes available offers; trade history records what has happened. Resting quantity is not traded volume. Both also belong to a particular platform and pair, not every bitcoin trade worldwide. [1] [2]

In ordinary continuous trading, the best bid is the highest buying offer and the best ask the lowest selling offer. Their difference is called the Bid–ask spread. An immediate purchase takes from the asks; an immediate sale takes from the bids. This can seem confusing at first: although Petr is buying, waiting sellers set the price available for his immediate purchase. The last trade price is a different figure. [3] [4]

Several sellers can offer the same price. The display may add their quantities into a price level: a shared row for that price. In its aggregated data, Coinbase reports total quantity and the number of orders separately. You do not multiply that total by the order count again. Nor does the row identify the people behind those offers or your own order’s precise place in the queue. [1]

Instead of buying immediately, Petr can place his own offer and wait. Coinbase Exchange gives priority to price, then arrival time among orders with the same price. Older offers may therefore go first. A small incoming sale may never reach Petr even though trades occur at his price. This is a rule of that platform; other mechanisms or auctions may allocate fills differently. [5]

Only a small part of Petr’s desired quantity may be available at the cheapest asking price. If the order allows it, the next portion buys at a higher price. The average therefore depends on the quantity actually bought at each level. A price limit can prevent buying more expensively, but cannot guarantee the remaining quantity gets bought. Fees also matter to the total cost; the first row is not enough. [4]

A conspicuously large offer is sometimes called a wall. Petr might conclude that the price cannot pass it. Yet the offer can be canceled or gradually traded. CFA also discusses spoofing: misleading order placement without a genuine intention to execute. Neither an offer’s size nor its disappearance proves that intent by itself. A book snapshot cannot establish a certain price forecast or justify accusing a particular trader. [2] [3]

The display starts from a snapshot and subsequent updates in the order required by the data channel. In Coinbase level2, a new size is the total quantity at that price, not an amount to add. Zero size means removing the level. Misreading these rules can make an app show offers that do not exist. Smooth animation is therefore not evidence that the data are correct and current. [2]

Sometimes a platform collects orders for an auction instead of matching them continuously. Coinbase explains that no trades occur during this collection phase, and buying prices can appear to exceed selling prices. Auction quotes are indicative and can change. Petr cannot infer an immediate guaranteed profit from such a table. First he needs to know the market, the age of the data and whether normal trading, an auction or restricted operation is underway. [1]