In cryptocurrency trading, Maker and Taker are two commonly used types of orders.
A Maker order refers to an order where you are only acting as a maker. A Taker order, on the other hand, refers to an order that removes liquidity from the order book when filled. Maker orders are passive orders that don’t immediately execute in the market, instead being added to the order book to provide liquidity. This is why they are also known as orders that add liquidity to the market. Maker orders are typically used when you want to place buy or sell orders within a certain price range and don’t need an immediate execution, allowing you to secure better trading prices.
In trading, Maker orders are usually more advantageous than Taker orders because Maker’s opening and closing fees are generally lower than Taker’s fees. This is why many traders prefer to only place Maker orders.
It’s important to note that if a Maker-only order’s price is the same as an existing order in the book, the order will be canceled, as it no longer provides liquidity.