What are Maker and Taker: How Order Type Determines Fee Size

In cryptocurrency trading, success depends not only on making accurate price movement predictions but also on minimizing expenses. This is where two key types of orders come into play—maker and taker. These are not just technical terms; they represent two fundamentally different approaches to interacting with the market, which directly affect the commission size and ultimately the trader’s actual profit.

Maker and Taker: Two Opposite Approaches to Market Trading

Every time you open a position, you choose between two strategies for market interaction. A taker is someone who wants everything immediately: execute an order instantly at the current price. A maker is a patient trader willing to wait until the market reaches their price. Both approaches are valid, but they have very different consequences for your wallet.

How Takers ‘Take’ Liquidity: Prioritizing Speed Over Price

A taker order is an instruction to buy or sell immediately at any available market price. When you place such an order, it instantly matches with existing orders in the order book that are already waiting. This order “takes” (hence the name—taker) the liquidity provided earlier by other participants.

The advantage of a taker order is clear: execution speed. If you need to quickly close a losing position or lock in profits fast, a taker is your choice. But this speed comes at a cost—literally. For the privilege of instant execution, traders pay a higher fee. On most crypto platforms, taker fees range from 0.04% to 0.06% of the trade volume.

The Maker’s Role in Market Stabilization and Cost Savings

A maker order works differently. When you place such an order, it is not executed immediately. Instead, it is added to the order book and waits until a counterparty is willing to trade at your specified price. While the order remains in the book, it provides liquidity for other traders (hence “maker”—the one who creates trading conditions).

The market rewards makers for their service: they pay a reduced fee, typically between 0.01% and 0.02% of the volume. This is nearly three times lower than the taker fee. Additionally, makers influence the spread (the difference between the best bid and ask prices), narrowing it and making the market healthier.

Table: Key Differences Between Maker and Taker

How Fees Affect Actual Profit: Practical Calculation

Let’s see how choosing between a maker and a taker impacts your final profit. Consider two strategies using the BTCUSDT trading pair:

• Trade volume: 2 BTC
• Entry price: $60,000 per BTC
• Exit price: $61,000 per BTC
• Profit before fees: 2 × ($61,000 − $60,000) = $2,000

Scenario 1: Trader using only makers

• Opening fee: 2 × $60,000 × 0.02% = $24
• Closing fee: 2 × $61,000 × 0.02% = $24.40
• Actual profit: $2,000 − $24 − $24.40 = $1,951.60

Scenario 2: Trader using only takers

• Opening fee: 2 × $60,000 × 0.05% = $60
• Closing fee: 2 × $61,000 × 0.05% = $61
• Actual profit: $2,000 − $60 − $61 = $1,879

Result: With the same profitable price movement, the trader who used maker orders earned $72.60 more—almost 3.7% additional profit thanks to lower fees. Scaling this over a year of activity, the difference becomes significant.

Fee Structures and Variations Across Trading Pairs

Most major crypto exchanges employ a unified maker/taker fee structure across all trading pairs. This means whether you trade main pairs like BTC or ETH or more exotic altcoins, the fee difference remains proportional.

Furthermore, many platforms offer VIP tiers for active traders, where maker fees can be even lower—potentially zero for top-tier levels.

How to Become a Maker: Practical Tips

To qualify as a maker and benefit from reduced fees, follow these recommendations:

1. Use limit orders. This is the only way to open a maker order. Market orders will always be processed as takers.

2. Set your price strategically. Your limit should be:

   • For buying: below the current best bid
   • For selling: above the current best ask

3. Choose passive options. Some platforms offer “Post-Only” features that guarantee your order will never be executed immediately as a taker.

4. Plan ahead. If you want to enter a position, place your maker order in advance to give the market time to match.

Speed vs. Cost: When to Choose Each

In practice, you can’t always rely solely on makers:

• Use makers if you have time and are willing to wait for execution. Ideal for planned entries or long-term holding.

• Use takers when speed is essential: closing a losing position quickly, locking in profits fast, or reacting to sharp market movements.

The best approach for most traders is to combine both: use makers for planned entries and takers only in critical situations where speed outweighs cost savings.

Summary: Equip Yourself with Maker and Taker Knowledge

Understanding the difference between maker and taker is not just theoretical—it’s a practical tool to optimize costs and increase your final profit. Every percentage saved on fees is a percentage kept in your pocket.

Next time you make a trade, pause and ask yourself: “Do I need the speed of a taker, or can I wait and save like a maker?” Choosing correctly between maker and taker can add thousands of dollars to your account over time. Knowing how these two order types work gives you a competitive edge in the market.