How the Iceberg Order Helps Execute Large Trades Without Market Impact

The iceberg order is the ideal solution for those who need to execute large transactions without leaving traces in the market. This intelligent mechanism fragments your operations into small automatic parcels, allowing quick market entry and significantly reducing slippage. For market makers and large traders, it provides a discreet way to influence market dynamics without fully exposing their intentions. The automatic division hides the true size of the operation, revealing only small pieces in the order book, making it impossible for other traders to identify and react to your large position.

What Makes the Iceberg Order Different

Unlike traditional orders, the iceberg order functions as a layered execution strategy. You set the total volume you want to trade, and the system divides it into discreet, equal suborders. As each suborder is executed, a new one automatically takes its place, until the entire quantity is filled. This offers two major benefits: first, it prevents abrupt price movements caused by large volumes; second, it keeps your true buying or selling intent hidden.

The iceberg order on the platform offers features that enhance your control over execution:

• Price limit control: Set maximum and minimum acceptable levels for your transaction, ensuring no suborder executes outside these limits
• Dynamic hidden volume: Only a small portion of your order is visible in the market at any given time, protecting your strategy
• Protection against price movement: Ideal for large positions, reducing the risk of adverse impact that could harm your entry average

How the Iceberg Order Works in Practice

When you create an iceberg order, you define two main parameters: the total amount you want to trade and the size of each individual suborder. The system automatically sends the first parcel to the order book. As it is filled, the system immediately places the next suborder, repeating this cycle until the entire order is completed.

There are two ways to configure the division: you can choose the exact size of each suborder (e.g., 0.6 BTC) or determine how many parcels you want to split your total order into (e.g., 10 parcels). The system calculates automatically and executes as specified.

Available Execution Preferences

The iceberg order offers four distinct execution modes to suit different strategies:

Market Mode (Taker Priority)

• Prioritizes maximum execution speed
• Sends buy orders at the best ask price (Ask 1) and sell orders at the best bid price (Bid 1)
• Ideal for time-sensitive operations where quick entry/exit is needed

Limit Mode (Maker Tracking)

• The system dynamically adjusts your price as the market moves
• Your orders follow the best prices (Bid 1 for buy, Ask 1 for sell)
• Perfect for traders who want to execute as a “maker” (liquidity provider) without significant delays

Limit Mode with Offset (Compromise)

• Finds a balance between speed and price
• Places your orders at a fixed distance from the best price (e.g., 5 ticks below Ask 1)
• Reduces your operational costs while maintaining reasonably fast execution

Fixed Price Mode

• You set a specific price, and all suborders are sent at that level
• Works like a traditional limit order
• Ideal for entry/exit strategies at predetermined levels

Price Limit Protection

The iceberg order allows you to set a price limit as a safeguard. This means your order will only activate when market conditions reach favorable levels:

• For buys: The order waits until the traded price is at or below your limit
• For sells: The order waits until the price is at or above your limit

If the market moves against you, execution pauses automatically until the price returns to your parameters. This prevents executing under worse conditions than expected.

You can also activate the “post-only” option (available in some modes), ensuring your order functions only as a maker. If the system detects it would execute as a taker, it automatically cancels. In extreme volatility, if your order is rejected 5 times in a row under this condition, the entire strategy is terminated.

Practical Execution Example

Imagine a trader wants to discreetly buy 6 BTC. They set up their iceberg order with these parameters:

• Contract: BTC/USDT
• Total quantity: 6 BTC
• Suborder size: 0.6 BTC
• Mode: Limit (Maker Tracking)
• Price: Ask 1 (best available sell price)
• Price limit: 20,000 USDT

The system automatically divides into 10 suborders of 0.6 BTC each. The first appears in the book at the Ask 1 price. When filled, the next is automatically sent at the same price. This continues until all 6 BTC are purchased. Throughout the process, the 20,000 USDT limit is strictly respected—no suborder executes above this level.

The result is that the trader achieves a better average price, as each suborder seeks the best available conditions, and their actual volume never fully exposes their intent to the market.

Rules and Limits for the Iceberg Order

Each platform sets restrictions for responsible use:

For spot operations:

• Maximum total quantity: up to 100 times the maximum allowed single order size
• Each suborder: respects the maximum single order limit

For derivatives (futures/perpetuals):

• Maximum total quantity: up to 500 times the maximum contract size
• Each suborder: up to 5 times the maximum contract size

General restrictions:

• Up to 10 iceberg orders per account simultaneously
• Only 1 iceberg order per trading symbol
• Each strategy expires automatically after 7 days, canceling unfilled suborders
• Supported on main accounts and subaccounts
• Not available in demo/trading simulation

When the Iceberg Order Is Canceled

An iceberg order terminates in the following scenarios:

• Insufficient balance to cover operations
• Manual cancellation by the trader
• 7-day expiration period
• Reduced coin quantity to insufficient levels
• Change in account position mode
• Activation of reduce-only orders
• Risk of liquidation if position is near delivery
• Excess leverage permitted
• Excess interest on open positions
• Account needs migration to the new unified system version
• Account suspension for security reasons

How to Create and Manage Your Iceberg Order

Step 1 – Access On the trading page, select “Iceberg Order” in the order type preferences.

Step 2 – Configuration Set the following parameters:

• Total quantity to trade
• Division: choose between suborder size or total number of suborders
• Execution preference: Market, Limit, Limit + Offset, or Fixed Price
• Price limit (if applicable)

Then click “Buy/Long” or “Sell/Short” according to your direction.

Step 3 – Confirmation Carefully review all entered parameters and confirm.

Management Access “Tools” and select the “Iceberg” tab to view your active orders, history, or to end strategies. To close a specific iceberg order, click “End” in the positions tab.

The iceberg order represents a significant evolution in large-volume execution, allowing sophisticated traders to maximize efficiency while minimizing market impact.