Maker vs Taker Fees in Crypto Trading
Master the difference between maker and taker fees in cryptocurrency trading. Learn proven strategies to minimize trading costs and maximize your profits through smart order placement.
What You'll Learn
- What maker and taker fees are
- How these fees impact your trading costs
- Strategies to minimize trading fees
- Real-world fee calculations and examples
- Exchange fee comparison and optimization
Understanding Trading Fees
Quick Definition:
Maker and taker fees are the two main types of trading fees charged by cryptocurrency exchanges. Makers add liquidity to the order book, while takers remove liquidity from it.
Every time you trade cryptocurrency, you pay fees to the exchange. Understanding the difference between maker and taker fees can save you significant money, especially if you're an active trader. The key is knowing when your order adds or removes liquidity from the market.
Fee Impact Example:
High-Fee Approach:
- • Always use market orders (taker fees)
- • $100,000 monthly volume
- • 0.1% taker fee = $100/month
- • Annual cost: $1,200
Optimized Approach:
- • Mix of limit orders (maker fees)
- • $100,000 monthly volume
- • 0.05% average fee = $50/month
- • Annual cost: $600 (50% savings)
Maker Fees: Adding Liquidity
What Makes You a Maker?
You become a "maker" when your order adds liquidity to the order book. This happens when you place a limit order that doesn't immediately match with an existing order.
Maker Order Examples:
- • Buy Limit: BTC is $50,000, you place buy order at $49,500
- • Sell Limit: BTC is $50,000, you place sell order at $50,500
- • Post-Only Orders: Orders that are guaranteed to be maker orders
Why Exchanges Reward Makers
Provide Liquidity
Make it easier for others to trade
Reduce Spreads
Narrow the gap between buy/sell prices
Improve Market Depth
Create more stable trading environment
Maker Fee Benefits
Lower Fees
Typically 0.05-0.1% vs 0.1-0.2% for takers
Price Control
You set the exact price you want
No Slippage
Order executes at your specified price
Trade-off to Consider:
Maker orders may not execute immediately (or at all) if the market moves away from your price. You save on fees but sacrifice speed and execution certainty.
Taker Fees: Removing Liquidity
What Makes You a Taker?
You become a "taker" when your order removes liquidity from the order book. This happens when you place an order that immediately matches with an existing order.
Taker Order Examples:
- • Market Orders: Buy/sell immediately at current market price
- • Aggressive Limits: Limit order that crosses the spread
- • Stop Orders: Orders triggered by price movements
When to Use Taker Orders
Urgent Execution
Need to trade immediately
Strong Market Moves
Price moving rapidly in your favor
Stop Losses
Risk management requires immediate exit
Taker Fee Costs
Higher Fees
Usually 2x maker fees
Potential Slippage
May not get expected price
Market Impact
Large orders can move prices
Fee Structure Comparison
Major Exchange Fee Comparison
Exchange | Maker Fee | Taker Fee | Volume Discounts |
---|---|---|---|
Binance | 0.1% | 0.1% | Yes (up to 50% off) |
Coinbase Pro | 0.5% | 0.5% | Yes (volume-based) |
Kraken | 0.16% | 0.26% | Yes (volume-based) |
FTX | 0.02% | 0.07% | Yes (aggressive tiers) |
Bybit | 0.1% | 0.1% | Yes (VIP levels) |
Fee Calculation Examples
$10,000 Trade on Binance:
- • Maker Fee: $10,000 × 0.1% = $10
- • Taker Fee: $10,000 × 0.1% = $10
- • Difference: $0 (same rate)
$10,000 Trade on Kraken:
- • Maker Fee: $10,000 × 0.16% = $16
- • Taker Fee: $10,000 × 0.26% = $26
- • Difference: $10 savings with maker
Strategies to Minimize Trading Fees
1. Maximize Maker Orders
Techniques:
- • Use limit orders instead of market orders
- • Place orders slightly away from current price
- • Use post-only order types when available
- • Be patient and wait for fills
Example Strategy:
BTC at $50,000:
Instead of market buy, place limit buy at $49,950.
Save on fees and potentially get better price.
2. Leverage Volume Discounts
Track Your Volume
Monitor 30-day trading volume to qualify for lower tiers
Hold Exchange Tokens
BNB, FTT, etc. often provide additional discounts
VIP Programs
Apply for institutional rates if you qualify
3. Smart Order Management
Dollar-Cost Averaging (DCA):
Instead of one large order, split into multiple smaller orders over time.
Traditional:
$10,000 market buy = $26 fee (Kraken)
DCA with Limits:
10 × $1,000 limit orders = $16 total fees
Iceberg Orders:
Hide large order size while maintaining maker status. Only show small portions at a time.
4. Exchange Selection Strategy
For High-Volume Traders:
- • Choose exchanges with aggressive volume discounts
- • Consider FTX, Binance for lowest fees
- • Factor in withdrawal fees and spreads
For Casual Traders:
- • Focus on ease of use and security
- • Consider Coinbase Pro, Kraken
- • Factor in deposit/withdrawal options
Real-World Fee Optimization Examples
Case Study 1: Active Day Trader
Profile: $50,000 monthly volume, 100 trades/month, primarily Bitcoin and Ethereum
Before Optimization:
- • 100% market orders (taker fees)
- • Binance: 0.1% taker fee
- • Monthly cost: $50,000 × 0.1% = $50
- • Annual cost: $600
After Optimization:
- • 70% limit orders (maker fees)
- • 30% market orders (urgent trades)
- • Average fee: 0.07%
- • Monthly cost: $50,000 × 0.07% = $35
- • Annual savings: $180 (30%)
Case Study 2: DCA Investor
Profile: $2,000 monthly DCA into Bitcoin, weekly purchases
Coinbase (Regular):
- • 1.49% fee on purchases
- • Monthly cost: $2,000 × 1.49% = $29.80
- • Annual cost: $357.60
Coinbase Pro (Optimized):
- • Use limit orders: 0.5% maker fee
- • Monthly cost: $2,000 × 0.5% = $10
- • Annual savings: $237.60 (66%)
Advanced Fee Optimization Tips
Pro Strategies:
Rebate Programs
Some exchanges pay you to provide liquidity
API Trading
Automated strategies for optimal order placement
Cross-Exchange Arbitrage
Profit from price differences while providing liquidity
Tools & Resources:
Fee Calculators
Compare costs across different exchanges
Order Book Analysis
Tools to analyze liquidity and optimal order placement
Trading Bots
Automated systems for fee-optimized trading
Master Advanced Trading Strategies
Now that you understand trading fees, explore advanced strategies like margin trading and futures to amplify your trading potential while managing risks effectively.