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The image below shows the Level 2 bids for Fortescue Metals Group Ltd (OTCQX: FSUMF) on 2020-10-07 10:19 am:

Notice the 0.01 × 10,000 bid by NITE (Virtu Americas LLC), which is extremely unlikely to be matched. What's the reason for placing a bid at an absurd price? Why don't market makers simply cancel their orders instead?

I've noticed this practice — market markers placing very low bids or very high asks — in many securities, so I think this is a rather common practice.

I understand that the minimum quotation size in this case is a function of the bid price (according to FINRA rule 6433. Minimum Quotation Size Requirements For OTC Equity Securities), so my question is more about the $0.01 bid price rather than the 10,000 bid size.

The image below shows the Level 2 bids for Fortescue Metals Group Ltd (OTCQX: FSUMF) on 2020-10-07 10:20 am:

Notice the 0.01 × 10,000 bid by NITE (Virtu Americas LLC), which is extremely unlikely to be matched. What's the reason for placing a bid at an absurd price? Why don't market makers simply cancel their orders instead?

I've noticed this practice — market markers placing very low bids or very high asks — in many securities, so I think this is a rather common practice.

I understand that the minimum quotation size in this case is a function of the bid price (according to FINRA rule 6433. Minimum Quotation Size Requirements For OTC Equity Securities), so my question is more about the $0.01 bid price rather than the 10,000 bid size.

The image below shows the Level 2 bids for Fortescue Metals Group Ltd (OTCQX: FSUMF) on 2020-10-07 10:19 am:

Notice the 0.01 × 10,000 bid by NITE (Virtu Americas LLC), which is extremely unlikely to be matched. What's the reason for placing such large bid at an absurd price? Why don't market makers simply cancel their orders instead?

I've noticed this practice — market markers placing very low bids or very high asks — in many securities, so I think this is a rather common practice.

The image below shows the Level 2 bids for Fortescue Metals Group Ltd (OTCQX: FSUMF) on 2020-10-07 10:19 am:

Notice the 0.01 × 10,000 bid by NITE (Virtu Americas LLC), which is extremely unlikely to be matched. What's the reason for placing a bid at an absurd price? Why don't market makers simply cancel their orders instead?

I've noticed this practice — market markers placing very low bids or very high asks — in many securities, so I think this is a rather common practice.

I understand that the minimum quotation size in this case is a function of the bid price (according to FINRA rule 6433. Minimum Quotation Size Requirements For OTC Equity Securities), so my question is more about the $0.01 bid price rather than the 10,000 bid size.

The image below shows the Level 2 bids for Fortescue Metals Group Ltd (OTCQX: FSUMF) on 2020-10-07 10:19 am:

Notice the recent 0.01 × 10,000 bid by NITE (Virtu Americas LLC), which is extremely unlikely to be matched. What's the reason for placing such large bid at an absurd price? Why don't market makers simply cancel their orders instead?

I've noticed this practice — market markers placing very low bids or very high asks — in many securities, so I think this is a rather common practice.

The image below shows the Level 2 bids for Fortescue Metals Group Ltd (OTCQX: FSUMF) on 2020-10-07 10:19 am:

Notice the 0.01 × 10,000 bid by NITE (Virtu Americas LLC), which is extremely unlikely to be matched. What's the reason for placing such large bid at an absurd price? Why don't market makers simply cancel their orders instead?

I've noticed this practice — market markers placing very low bids or very high asks — in many securities, so I think this is a rather common practice.