What order types does Bybit contract support? What scenarios are iceberg orders and hidden orders suitable for?

Bybit offers various order types like market, limit, and specialized iceberg and hidden orders, which help traders manage large volumes discreetly and strategically.

Apr 28, 2025 at 02:07 am

Bybit, a leading cryptocurrency derivatives exchange, offers a variety of order types to cater to the diverse needs of traders. Understanding these order types and their specific applications can significantly enhance trading strategies. In this article, we will explore the different order types supported by Bybit, with a particular focus on iceberg orders and hidden orders, and discuss the scenarios in which these specialized orders are most suitable.

Overview of Bybit Order Types

Bybit supports several order types, each designed to meet different trading requirements. The primary order types include:

• Market Orders: These orders are executed immediately at the best available price in the market. They are ideal for traders who prioritize speed over price.

• Limit Orders: Traders can set a specific price at which they want to buy or sell. The order will only be executed if the market reaches the specified price. Limit orders are useful for those who want to control the price at which they trade.

• Stop Orders: These are used to limit losses or protect profits. A stop order becomes a market order once the stop price is reached. They are essential for risk management.

• Stop-Limit Orders: Combining the features of stop and limit orders, a stop-limit order turns into a limit order when the stop price is reached. This type of order provides more control over the execution price.

• Trailing Stop Orders: These orders allow traders to set a stop price at a fixed percentage or dollar amount below the market price. The stop price adjusts as the market price moves, helping to lock in profits while allowing for potential further gains.

• Post-Only Orders: These orders are designed to add liquidity to the order book without taking liquidity. If a post-only order would execute immediately, it is canceled instead.

• Iceberg Orders: These orders allow traders to hide the total volume of their order, showing only a small portion at a time. This can be useful for large traders who want to minimize market impact.

• Hidden Orders: Similar to iceberg orders, hidden orders are completely concealed from the order book. They are used by traders who want to execute large orders without influencing the market.

Understanding Iceberg Orders

Iceberg orders are a type of order where only a small portion of the total order size is visible to the market, while the rest remains hidden. This allows traders to execute large orders without significantly impacting the market price.

How Iceberg Orders Work

When placing an iceberg order, traders specify the total order size and the visible portion. For example, if a trader wants to sell 100 BTC but only wants to show 10 BTC at a time, they would set the total order size to 100 BTC and the visible portion to 10 BTC. As the visible portion is filled, the next portion of the order becomes visible until the entire order is executed.

Scenarios Suitable for Iceberg Orders

Iceberg orders are particularly useful in the following scenarios:

• Large Volume Trading: Traders with large volumes to trade can use iceberg orders to avoid moving the market against their position. By showing only a small portion of their order, they can minimize the impact on the market price.

• Minimizing Market Impact: When a large order is placed, it can cause the market price to move unfavorably. Iceberg orders help mitigate this by gradually revealing the order, thus reducing the immediate impact on the market.

• Strategic Trading: Traders who want to maintain a strategic advantage can use iceberg orders to hide their true trading intentions. This can be particularly useful in volatile markets where large orders can trigger significant price movements.

Understanding Hidden Orders

Hidden orders are orders that are completely invisible to the market. Unlike iceberg orders, which show a small portion of the total order, hidden orders are not displayed in the order book at all.

How Hidden Orders Work

When a hidden order is placed, it does not appear in the order book. The order is only executed when the market price reaches the specified price. This type of order is ideal for traders who want to execute large orders without any market visibility.

Scenarios Suitable for Hidden Orders

Hidden orders are particularly useful in the following scenarios:

• Executing Large Orders: Traders with very large orders can use hidden orders to avoid any market impact. Since the order is not visible, it does not influence the market price until it is executed.

• Maintaining Anonymity: Traders who want to keep their trading activities confidential can use hidden orders. This is particularly important for institutional traders who need to maintain anonymity in their trading strategies.

• Avoiding Front-Running: Hidden orders can help prevent other traders from front-running the order. Since the order is not visible, other traders cannot anticipate and trade ahead of it, potentially moving the market price unfavorably.

Practical Application of Iceberg and Hidden Orders

To illustrate the practical application of iceberg and hidden orders, let's consider a few examples:

Example of Using an Iceberg Order

Suppose a trader wants to sell 500 BTC without significantly impacting the market price. They can place an iceberg order with the following parameters:

• Total Order Size: 500 BTC
• Visible Portion: 10 BTC

As the market fills the visible portion of 10 BTC, the next 10 BTC becomes visible, and this process continues until the entire 500 BTC is sold. This approach helps the trader sell a large volume without causing a significant price drop.

Example of Using a Hidden Order

Consider a trader who wants to buy 1000 ETH without any market visibility. They can place a hidden order with the following parameters:

• Order Type: Hidden
• Order Size: 1000 ETH
• Price: Market or Limit

The order will not appear in the order book, and it will be executed when the market price reaches the specified price. This allows the trader to buy a large volume without influencing the market price.

Frequently Asked Questions

Q: Can iceberg and hidden orders be used together?

A: Yes, traders can use both iceberg and hidden orders in their trading strategies. For example, a trader might use an iceberg order to sell a large volume gradually and a hidden order to buy a large volume without any market visibility. Combining these order types can provide a comprehensive approach to managing large trades.

Q: Are there any fees associated with using iceberg and hidden orders on Bybit?

A: Bybit does not charge additional fees for using iceberg and hidden orders. However, traders should be aware of the standard trading fees that apply to all orders on the platform.

Q: How can I place an iceberg or hidden order on Bybit?

A: To place an iceberg or hidden order on Bybit, follow these steps:

• Log in to your Bybit account and navigate to the trading interface.
• Select the market you want to trade in (e.g., BTC/USD).
• Choose the order type from the dropdown menu. Select "Iceberg" or "Hidden" as needed.
• Enter the order parameters, such as total order size, visible portion (for iceberg orders), and price.
• Review and confirm the order details before submitting it.

Q: Can iceberg and hidden orders be canceled or modified after they are placed?

A: Yes, iceberg and hidden orders can be canceled or modified after they are placed. To do so, navigate to the "Open Orders" section in your Bybit account, find the order you want to modify or cancel, and select the appropriate action. Keep in mind that any modifications or cancellations may affect the execution of the order.