Exchange Logic

Definition ∞ Exchange logic refers to the programmed rules and algorithms that govern the operational behavior of a trading platform. This includes mechanisms for order matching, price determination, liquidity provision, and trade execution. It dictates how buy and sell orders interact to form market prices. Robust exchange logic is vital for fair and efficient market operation.
Context ∞ In cryptocurrency exchanges, transparent and reliable exchange logic is crucial for maintaining user trust and market integrity. News often examines how different exchanges implement their order books and matching engines, particularly in decentralized finance (DeFi) platforms. Any perceived flaws or exploits in exchange logic can lead to significant market disruptions or security vulnerabilities.