Crypto Retail Traders Hit with High Fees Due to Maker-Taker System
A new study by Stanford University and Columbia Business School has found that retail traders in crypto perpetual futures markets face high fees, which disproportionately affect them compared to institutional investors.
The research focuses on Hyperliquid, one of the largest venues for perpetual futures contracts in crypto. It reveals that individual traders consistently pay higher fees than their institutional counterparts due to their tendency to execute trades as takers, rather than makers.
The maker-taker fee system charges more for removing liquidity from the market, which is what takers do when they place market orders. Retail traders favor immediacy over cost efficiency and tend to use market orders, making them more likely to pay premium fees.
This pattern reinforces itself as more sophisticated traders and market makers sit on the maker side, earning rebates or paying lower fees while providing liquidity for retail traders to consume.