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What is a Market Maker and a Market Taker Order?
Cointr
2024-12-31 19:18
What is a Market Maker and a Market Taker Order?
When trading in cryptocurrency markets, one of the most basic terms that users will encounter is the terms market maker and market taker. Orders executed by market makers and takers are called Market Maker Orders or Market Taker Orders. These terms are used in cryptocurrency markets to describe an investor's impact on market liquidity (money).
What is a Market Maker Order?
A market maker order is a transaction that provides liquidity to the cryptocurrency market and adds a new order to the trading book. These orders are not matched immediately and wait for a while in the order book. Market makers generally benefit from lower transaction fees because they contribute to the functioning of the market. Market makers trade in the market as users who usually try to buy or sell a crypto asset at the best available bid. Thus, they contribute to the market by creating a market that is reflected in the current last price. In cryptocurrency markets, market makers are often willing to buy or sell, but they may withdraw and remain silent during extremely volatile periods.
For example:
If a user wants to sell Bitcoin at $90,000 on the order book, this order is not instantly matched and is added to the book. This user is the market maker.
What is a Market Taker Order?
A market taker order is a type of order that matches an existing market maker order and trades. Market takers "take" liquidity because they work to complete a pending order in the market. These types of orders are usually used by users who want to trade quickly at the cryptocurrency market price and are generally subject to higher transaction fees. Market takers are generally investors who execute orders entered by market makers. For this reason, market takers can be defined as users who execute market makers' sales transactions rather than trading at the best bid or ask price.
For example:
If a user wants to buy Bitcoin immediately at the current selling price (e.g. $90,000), this transaction is a market taker transaction.
How Does the CoinTR Maker-Taker Fee Model Work?
CoinTR uses the Maker-Taker fee model to determine transaction fees. This model applies different fee rates for liquidity-providing orders (maker orders) and liquidity-drawing orders (taker orders).
How Does the Maker-Taker Fee Model Work?
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Taker Orders:
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If your order is executed immediately, you are considered a Taker and pay a transaction fee of 0.20%.
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Maker Orders:
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If you place a buy or sell order that is not matched immediately, you are considered a Maker and pay a transaction fee of 0.20%.
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Partial Match Cases:
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When you place an order that is partially matched immediately, you pay a Taker transaction fee for that portion.
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The rest of the order remains in the order book and when matched, it is considered a Maker order and a Maker transaction fee is charged.
For more detailed information about transaction fees and rates, please visit the 'Spot Transaction Fees' page.
If you have any further questions, please contact
CoinTR Customer Support Team.
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