Certain exchanges in finance: whether legacy markets like FOREX and stocks, or cryptocurrency markets like bitcoin and litecoin, offer a fee structure called the maker/taker model. It's pretty simple how it works:
Maker order is when you create a bid or ask and put your order into the orderbook, waiting to be filled by a counterparty.
Taker order is when you fill an existing order that is in the orderbook, removing liquidity from the market.
With the goal of having higher volume, some exchanges will have 0% fees (as the Chinese bitcoin spot exchanges are famous for) or they will even have negative fees for maker orders, also known as a rebate, which actually compensates traders who provide liquidity to the market by filling the orderbook.
The maker/taker fee model in bitcoin exchanges is a great way to get traders to actively pack the orderbook, which tightens the spreads and benefits everyone.
Taker order is when you fill an existing order that is in the orderbook, removing liquidity from the market.
With the goal of having higher volume, some exchanges will have 0% fees (as the Chinese bitcoin spot exchanges are famous for) or they will even have negative fees for maker orders, also known as a rebate, which actually compensates traders who provide liquidity to the market by filling the orderbook.
The maker/taker fee model in bitcoin exchanges is a great way to get traders to actively pack the orderbook, which tightens the spreads and benefits everyone.
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