Jay Berg, a Wall Street high-frequency trading (HFT) veteran and the first to tweet the Bitcoin ticker symbol, has launched SidePit, a Bitcoin Layer 2 (L2) exchange aimed at addressing market manipulation and the exploitation of unfair advantages, such as front-running, in decentralized markets. SidePit, currently in its private alpha phase, introduces a decentralized limit order book (DLOB) to combat these issues, offering a solution that eliminates front-running and latency arbitrage. This innovation is part of a broader strategy to disrupt the fragmented US spot Bitcoin markets for ETFs, addressing the challenges of liquidity and market manipulation. SidePit's approach includes a members-only platform with a trading competition for holders of Ordinals (Bitcoin NFTs) "OG Trading Jackets," aiming to foster fair price discovery and shape the future of exchange technology.

Jay Berg, renowned as the first to tweet the Bitcoin ticker symbol, has now introduced his most significant innovation yet: Sidepit. This new development marks a milestone in financial market exchange technology with the aim to revolutionize the landscape of bitcoin trading.Sidepit, currently in its private alpha phase for early adopters, emerges as a response to the challenges of front-running, also known as “MEV”, prevalent in today's decentralized markets. Sidepit addresses the growing market manipulation and unfair advantage exploitation.The initiative kicks off with the introduction of the Bitcoin L2 Sidepit, backed by Ordinals. This marks the initial step in a daring growth hacking strategy aimed at disrupting the fragmented US spot bitcoin markets for ETFs.Fragmented liquidityAs billions pour into ETFs, large institutional players demand liquid bitcoin markets. However, current markets suffer from fragmentation and illiquidity, resulting in unreliable executions. The absence of regulations across bitcoin exchanges exacerbates these issues when trading bitcoin.Wall Street fund managers are familiar with the challenge of bad exchange executions, and use OTC desks or run algos such as VWAP, instead of relying on exchange for fair market prices.Looking towards DeFi for a better exchange solutionDespite the hype, decentralized finance (DeFi), has proven to be ripe with manipulation, making HFT "Flashboys" seem tame in comparison. Can decentralized technology provide a better exchange, for bitcoin and traditional financial markets alike?Enter Sidepit: The DeFi solution for exchangeSidepit represents the answer. It serves as a digital iteration of physical trading pits, removing physical co-location, eliminating front-running, and disrupting latency arbitrage. The Bitcoin L2 Sidepit MVP, offers a glimpse into the future of exchange, where unfair advantages from HFT and MEV are a thing of the past.Sidepit DLOB: The key innovationSidepit's revolutionary innovation revolves around its Decentralized Limit Order Book (DLOB), originally designed to address blockchain "MEV" concerns, now extending its benefits to solve "HFT Co-Location" in traditional exchanges.DLOB introduces a market within a market, where orders undergo a brief freezing period, followed by an auction process to determine their sequence, and then processed through a conventional CLOB matching engine.By removing the time factor from the equation, order flashing and risk of flash crashes are also eliminated. Large institutions gain confidence in using Sidepit exchange over OTC, as the free market provides optimal prices. This represents a paradigm shift in global electronic markets, fostering fairer and more transparent market dynamics.Bitcoin L2 Sidepit, the first step towards solving exchangeThe launch of the Bitcoin L2 Sidepit heralds a new era in exchange technology. It's the first test of Sidepit's goals of eliminating execution risks for institutional Bitcoin holders. The ongoing trading competition will generate valuable data to quantify these results.The Bitcoin L2 Sidepit is a members-only platform, with Ordinals (bitcoin NFTs) “OG Trading Jackets" serving as requirements for entry. OGs will participate in a trading competition, contributing to fair price discovery and shaping the future of exchange technology.Paying homage to the legacy of physical trading pits, Sidepit jacket holders embody the spirit of early traders who once donned yellow jackets on bustling trading floors. As active participants in testing the DLOB model for the upcoming trading competition, they carry forward the traditions of camaraderie, competition, and innovation that defined the era of traditional trading pits.What next for Sidepit?"Institutions are eagerly awaiting the results of the OG Bitcoin Sidepit trading competition," says Jay Berg, CEO of Sidepit.Following the success of the Bitcoin L2 Sidepit, plans are underway for a US-based regulated Spot Bitcoin Sidepit, to provide best-in-class quality trade execution for institutional Bitcoiners.This post is commissioned by Sidepit and does not serve as a testimonial or endorsement by The Block. This post is for informational purposes only and should not be relied upon as a basis for investment, tax, legal or other advice. You should conduct your own research and consult independent counsel and advisors on the matters discussed within this post. Past performance of any asset is not indicative of future results.

Jay Berg Launches SidePit to Combat Market Manipulation in Bitcoin Trading