What is the concept of maker-taker in the cryptocurrency industry?

3 answers

• Saruê BoladoJan 02, 2025 · 8 months ago
  The concept of maker-taker in the cryptocurrency industry refers to the fee structure used by exchanges to incentivize liquidity. Makers are traders who add liquidity to the order book by placing limit orders, while takers are traders who remove liquidity by placing market orders. Makers are usually charged lower fees or even receive rebates, while takers are charged higher fees. This encourages traders to provide liquidity and helps maintain a healthy trading environment. By offering lower fees to makers, exchanges attract more participants and increase trading volume. This benefits both traders and the exchange.
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• RichardSsAug 28, 2022 · 3 years ago
  Maker-taker is a common fee structure in the cryptocurrency industry. It rewards traders who add liquidity to the market by placing limit orders. Makers are charged lower fees or even receive rebates, while takers, who remove liquidity by placing market orders, are charged higher fees. This incentivizes traders to provide liquidity and helps ensure a more liquid and efficient market. It also encourages market makers to participate actively, which can lead to tighter bid-ask spreads and better price discovery. Overall, the maker-taker model benefits both traders and exchanges by promoting liquidity and enhancing market efficiency.
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• JOSH MULIFeb 22, 2024 · 2 years ago
  In the cryptocurrency industry, the maker-taker model is widely used to incentivize trading activity and liquidity provision. As a market maker, you can enjoy lower fees or even receive rebates for adding liquidity to the order book. On the other hand, if you are a market taker who places market orders, you will be charged higher fees. This fee structure encourages traders to provide liquidity and helps maintain a balanced market. It also attracts more participants to the exchange, leading to increased trading volume and better price discovery. At BYDFi, we also follow the maker-taker model to promote a vibrant and liquid trading environment for our users.
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