Taker – why is it needed in cryptocurrency trading?

A taker is a trader who executes trades using market orders. Such traders significantly reduce liquidity as the number of orders from makers decreases.

A taker can not only make purchases. If you place a market order to sell at the current price, you are still considered a taker. Taker orders never appear in the order book; they essentially agree to the current price, and the transaction is executed instantly.

It is important to understand that according to the exchange's logic, a taker consumes liquidity, which is crucial in exchange trading. Therefore, taker trades are subject to higher fees compared to orders placed by makers. Although many traders disagree with this fee distribution, considering the roles of makers and takers to be equivalent.

Based on the principles mentioned above, cryptocurrency exchanges implement the "maker-taker" mechanism. Its existence minimizes the price difference between buying and selling a specific token. This creates small spreads, allowing for trading cryptocurrencies with high liquidity, which is important for a market where top tokens have significant value. The fundamental and established idea is to divide traders into two sides: liquidity providers and liquidity consumers.