Maker vs Taker: Understanding Exchange Fees
When it comes to cryptocurrency exchanges, one small trading fee may seem harmless at first glance. However, trade often and those fees can add up quickly.
The way an exchange charges maker and taker orders is a crucial factor in determining the lowest fees crypto exchange. Maker orders add liquidity to the market, while taker orders match existing liquidity. As a result, exchanges charge makers less than takers, or sometimes the same fee for both.
A deeper order book makes matching easier, which is why some exchanges prioritize liquidity. For instance, if you trade ₹1,00,000 worth of crypto at 0.10%, that's ₹100 in fees, while at 0.20%, it's ₹200. Active traders feel this impact the most due to their frequent trades.
Before choosing an exchange, traders should compare maker and taker trading fees, as well as fee tiers based on trading volume, bid-ask spreads, deposit and withdrawal charges, network fees for crypto withdrawals, order execution speed, and available liquidity. A low trading fee doesn't help much if spreads are wide or liquidity is weak.