Maker and Taker in Crypto Trading: How Two Opposing Forces Create Liquidity

Cryptocurrency markets operate thanks to the interaction of two key participant types: makers, who constantly provide liquidity, and takers, who immediately consume that liquidity. Without this dynamic balance between makers and takers, cryptocurrency trading would be impossible. While makers place orders in hopes that they will be filled later, takers buy or sell immediately at the current market price, activating makers’ offers. This interaction creates the foundation of a healthy trading ecosystem, ensuring smooth transactions, predictable prices, and reliable access to assets for all market participants.

The Role of the Maker: Liquidity Provider in the Crypto Market

A market maker is a specialized trader, institution, or investment firm that continuously places simultaneous buy and sell orders. Makers do not seek immediate order execution; instead, they set limit orders at predetermined prices, waiting for other participants (takers) to accept these prices.

The primary function of a maker is to “create the market” — by placing a buy order at $68,160 and a sell order at $68,170 for Bitcoin, the maker provides a $10 spread. This small gap between buy and sell prices serves as the maker’s profit margin. Through thousands of such micro-trades, makers generate a steady stream of income.

Makers operate continuously, especially on 24/7 crypto markets. They use sophisticated algorithms and high-frequency trading (HFT) systems to dynamically adjust their orders based on market conditions. When the market is volatile, makers immediately adapt their spreads by analyzing liquidity depth, trading volume, and current supply and demand. This constant adaptation helps minimize losses during sharp price movements.

Major financial institutions, hedge funds, and specialized trading firms dominate market making. However, retail traders can also act as makers by placing limit orders on crypto exchanges, albeit on a smaller scale.

Taker vs. Maker: Who Needs Whom More?

A market taker is the direct opposite of a maker. If a maker “creates” liquidity by placing orders for later execution, a taker “consumes” that liquidity by immediately executing available orders. When a taker wants to buy or sell urgently, they accept the current market price without waiting for more favorable conditions.

Examples of these roles:

• Maker: Places a buy order for BTC at $68,150 and a sell order at $68,170, keeping them in the order book awaiting execution.
• Taker: Urgently wants to buy BTC and immediately accepts the maker’s offer at $68,170, activating the sell order.

The key difference: makers wait for execution; takers do not. Makers earn on the spread, while takers pay the spread as a cost for immediate execution.

The interaction between makers and takers creates an ideal market balance. Makers ensure a continuous presence of buy and sell orders at various price levels, allowing takers to enter and exit positions without delays. In turn, takers generate trading activity and demand, constantly activating makers’ orders. Without takers, makers could not earn income; without makers, takers would face the impossibility of quick order fulfillment.

How Makers and Takers Create a Trading Ecosystem

The market-making mechanism works as follows:

Step 1: Placing Orders
The maker places a buy order for BTC at $68,160 and a sell order at $68,170 simultaneously. These orders remain in the exchange’s order book, accessible to any interested trader.

Step 2: Taker Intervention
When a taker wants to buy BTC urgently, they see the maker’s offer at $68,170 and accept that price immediately. The maker’s sell order is executed, earning a $10 spread (difference between buy at $68,160 and sell at $68,170).

Step 3: Inventory Management
After the trade, the maker analyzes their position. If they sold BTC and now have a surplus of cash, they may place more attractive buy orders to restore balance.

Step 4: Continuous Adjustment
The maker uses algorithmic trading bots that instantly adjust orders in response to volatility, liquidity depth, and order flow changes. If the market starts rising, these bots automatically shift spread prices upward, protecting the maker from losses.

This system provides several critical advantages for the entire trading ecosystem:

• Tight Spreads: Competition among multiple makers reduces the gap between buy and sell prices, saving money for every taker.
• Fast Execution: Sufficient maker presence ensures any taker can execute orders immediately without significant delays.
• Price Stability: Continuous maker and taker activity helps establish fair asset prices through real demand and supply, not speculation.

Leading Crypto Market Makers in 2025

Several major firms dominate the crypto market-making space. These companies possess substantial financial resources, advanced technology, and deep market knowledge.

Wintermute

Wintermute is a leading algo-trading firm managing around $237 million in assets across more than 300 on-chain assets. The company provides liquidity on over 50 crypto exchanges with a combined trading volume of approximately $6 trillion. Wintermute is known for its advanced algorithms and ability to operate on both centralized (CEX) and decentralized (DEX) markets.

Strengths:

• Extensive coverage across multiple exchanges and blockchains
• Innovative algorithmic strategies
• Reliable reputation and stability

GSR

GSR has served the crypto market for over ten years, investing in more than 100 leading companies and protocols. The firm offers comprehensive services: market making, OTC trading, and derivatives trading. GSR provides liquidity on over 60 exchanges and is known for its focus on long-term partnerships with token projects.

Strengths:

• Deep experience and long-standing presence
• Diverse services beyond market making
• Active involvement in investments and ecosystem development

Amber Group

Amber Group manages trading capital of about $1.5 billion for over 2,000 institutional clients. The company provides liquidity on numerous exchanges with a total trading volume exceeding $1 trillion. Amber Group is distinguished by its focus on risk management and AI utilization.

Strengths:

• Emphasis on compliance and AI-driven strategies
• Comprehensive financial services
• Strict risk management procedures

Keyrock

Founded in 2017, Keyrock handles over 550,000 daily trades across 1,300+ markets and 85 exchanges. The company offers not only market making but also OTC trading, options desk, treasury solutions, and liquidity management.

Strengths:

• High-frequency trading and liquidity optimization
• Custom solutions for various jurisdictions
• Data-driven approach

DWF Labs

DWF Labs manages a portfolio of over 700 projects and supports about 20% of the top 100 and over 35% of the top 1000 projects on CoinMarketCap. The firm not only provides liquidity but also invests in early-stage projects, offering OTC trading and derivatives.

Strengths:

• Investments in early-stage projects
• Competitive OTC solutions
• Significant influence on the Web3 ecosystem

How Makers Benefit Crypto Exchanges

Makers play a critical role in the success of any crypto exchange. Their constant activity transforms markets, creating conditions for mass attraction of both retail and institutional traders.

Increased Liquidity

Makers continuously place buy and sell orders, creating sufficient volume for large trades. Without makers, a trader trying to buy 100 BTC could sharply push the price up due to insufficient offers. With makers, such large trades execute smoothly without extreme price swings.

Reduced Volatility

Makers actively adjust their spreads in response to market movements, automatically lowering or raising prices depending on conditions. This acts as a “volatility buffer,” preventing sharp price jumps, especially on small altcoin markets with low volumes.

Market Efficiency

Makers facilitate “price discovery” — the process by which an asset’s true value is determined by real demand and supply rather than speculation. This leads to fairer prices and reduces information asymmetry among participants.

Attracting Traders and Increasing Revenue

Exchanges with high liquidity and narrow spreads attract more traders, boosting trading volumes and commissions. Many exchanges collaborate with makers to ensure liquidity when launching new tokens, ensuring successful listings.

Risks and Challenges for Crypto Market Makers

Despite the benefits, maker activity involves significant risks requiring constant monitoring and management.

Market Volatility and Unexpected Losses

Crypto markets are known for extreme volatility. If a maker holds a large position in an asset and the market moves sharply against them, they can incur substantial losses before adjusting their orders. Even the fastest algorithms may not react quickly enough during black swan events or emergency market moves.

Inventory Risks

Makers hold large amounts of crypto to provide liquidity. If the value of these assets drops suddenly, they can suffer huge losses due to declining asset value. This is especially risky in low-liquidity markets with wider spreads and more pronounced price movements.

Technological Risks and System Failures

Makers rely heavily on complex algorithms and HFT platforms. Technical failures, cyberattacks, or millisecond delays can lead to orders being executed at undesirable prices, disrupting trading strategies and causing losses.

Regulatory Uncertainty

Cryptocurrency regulation is constantly evolving. In some jurisdictions, market making may be considered market manipulation, leading to legal consequences. Compliance costs are significant, especially for makers operating across multiple global markets.

The Synergy of Maker and Taker: The Market’s Key Balance

The long-term health of crypto markets depends on the proper balance between makers and takers. An optimal market-making system features:

• Sufficient number of makers providing continuous liquidity
• Active takers creating demand and executing trades, activating makers’ orders
• Narrow spreads reducing costs for all participants
• Low price volatility fostering a stable trading environment
• Fast order execution attracting new traders to the platform

When this balance is disrupted — for example, when makers withdraw liquidity due to excessive volatility — takers face wider spreads, slower execution, and higher costs. This can create a spiral where low taker activity leads to even fewer makers.

Conclusion

Maker and taker are two complementary forces in the crypto trading ecosystem. Makers, by constantly placing orders, provide liquidity and stability. Takers, by executing these orders immediately, generate activity and demand. Together, they form a functional, efficient, and accessible market.

Leading market-making firms like Wintermute, GSR, DWF Labs, Amber Group, and Keyrock utilize sophisticated algorithms, deep data analysis, and cutting-edge technology to optimize liquidity. They not only profit for their investors but also play a critical role in maintaining healthy crypto markets.

However, makers face real risks: market volatility, technological failures, and regulatory uncertainty. As the crypto industry evolves, the maker’s role will remain central, but balancing risks and opportunities will be an ongoing challenge for market participants.