Maker vs Taker Fees in Crypto Explained

All orders that add liquidity to a market are ‘maker’ trades; all orders that take liquidity away from a market are ‘taker’ trades. Maker trades are advantageous to liquidity as they populate order books and allow for the time to cross trades. In crypto, makers are similar to traditional finance (TradFi) market makers in that they make markets.

Maker and taker fees usually vary across crypto products (e.g., standard cryptocurrencies vs stablecoins). Additionally, the fees makers and takers pay tend to decrease as trading volume increases.  

🧠 Let’s go in-depth!

Market Taker Fee Explained

A ‘taker’ fee is attached to orders on crypto exchanges that are set to get filled immediately. Taker fees are higher fees when compared to maker fees as these trades take liquidity away from the market. 

• Market Taker Trade Example

Let’s say you want to buy bitcoin (BTC) immediately. BTC is bid at $29,000 and offered at $29,010. Your market buy order would be filled immediately at (or hopefully near) the current ask price of $29,010. 

Since this order does not have time to be matched or added to a book, you are a drag on liquidity, and for this, you must pay! 

• Market Taker Fee Cost

The fee in the above trade example may be 0.16% of the total trade price; if this trade was placed away from the market (limit order), it would be a ‘taker’ fee, which may pay only 0.10%. 

• Market Taker Order Types

The below crypto order types are classified as maker trades:

• Market Order: Market orders will get filled immediately at the market price, whatever that may be.

• Limit Order Priced at Market: Limit orders that are filled immediately are takers. 

• All or None (AON): All or none says fill all of it or none of it; they are takers.

• Fill or Kill (FOK): Fill it now or cancel it orders are takers.

Market Maker Fee Explained

On cryptocurrency exchanges, market ‘maker’ fees are attached to orders that are placed away from the current market price. Limit orders placed away from the market are maker orders. 

• Market Maker Trade Example

Let’s say you want to buy ether (ETH) at a price of $1,900. Currently, the market (bid/ask price) for ETH is $1,920 / $1,935. 

If you place a limit order to buy ETH at $1,900, you will not get filled immediately. Your Ethereum sell order will be placed in a queue to be matched up with a buy order if/when the market falls to $1,900. 

By not being an immediate drag on liquidity, you are an asset to this exchange, and therefore the fee attached to your order will be less than a traditional market order. 

• Market Maker Fee Cost

Let’s say that the price of ETH falls to $1,900 and our limit order is triggered. 

Our order could be crossed with a separate market order to sell ETH. Since we are providing liquidity for this market order to be filled, our fee will be less than that of the marker ‘taker’ trade. Perhaps our maker fee will be 0.19% of the trade cost while the taker may pay 0.25% of the trade cost in fees.

• Market Maker Order Types

Here are all crypto order types associated with market maker trades.

• Limit Orders Priced Away From Market: Any limit order that won’t get filled immediately is a maker.

• Stop-Limit Orders: Stop-limit orders are a type of order that combines a stop and a limit; the stop triggers the trade, but it will not be filled at a worse price than the limit specifies.

Let’s next compare the trading fees for popular crypto trading platforms.

Comparing Maker & Taker Fees 

Let’s now look at the different maker and taker fees that major exchanges charge their users. 

⚠️ There is no ‘standard’ fee in crypto as there is for stock trading; crypto fee schedules can be incredibly convoluted and complex. The exception is tastytrade, which charges a flat 1% on all trades or $10, whichever is less.

Binance Maker/Taker Crypto Fees

The below chart from Binance represents their maker-taker fees for spot trading.