Maker and Taker fees is explained for bitcoin and crypto trading with focus on Binance trading site.
What does maker and taker fee mean and how can I benefit from it?
If you asked yourself this question, then we have the answer you were looking for.
In this crypto trading guide, we go over the maker and taker fee structure for crypto trading, its benefits and how it differs from spreads.
We also provide specific maker and taker fees schedules from some of the top Bitcoin trading sites.
Table - Maker Taker Spot Trading Fees
The highest fees are listed, there are different ways to get lower trading fees. Read more below.
What is Maker and Taker Fee?
Almost all crypto trading sites charges maker and taker fees for trading. But how do they differentiate?
- A maker is a trader who adds liquidity to the order book.
- A taker is a trader who takes liquidity out from the order book.
As noticed, there are two types of investment that carry different fee structure. These are maker (when trade adds to the platform’s liquidity) and taker orders (when traders take out the liquidity from the platform).
Maker orders do not close immediately but rather linger in due to price limits. Thus, they “make” the market, keeping it active. Takers file out immediately, “taking” the value out of the market. Thus, maker fees that activate the market and keep it that way usually come with reward of low fees. Takers charge regular trading costs, most of the time.
Maker trading fees are always lower than taker fees since all trading sites appreciate when liquidity is added to their order books.
What is Market order and Limit order?
- When you set a limit order, you usually want to add liquidity to the market because you don´t find and open order you are willing to accept. This will make you to market maker. (Technically, you can set a limit order that buys from the order book and that will make you to a market taker)
- If you go for the market order alternative, you will always be a market taker. When you execute the order you will buy/sell from the order book at the best price there is.
How to see makers and takers in an order book?
Maker and Taker Fee VS Spreads
Spreads are simple differences between buy and sell value for the cryptocurrency. They are not costs per say but they do have implications for traders to consider. Spread is the difference between the highest bidding price and lowest selling price in an order book. By definition, there will always be a spread in an order book since the market will execute any matched orders.
Spread is also important to take into consideration when trading and when you are looking for a trading platform. However, spreads are dynamic and will change all the time you it´s not sp easy to compare spread between different crypto trading platforms. However, the spread is usually direct independent on the trading volume and therefor you should go for crypto trading platforms with large trading volumes like Binance, Kraken, ByBit and Kucoin.
Who is a Market Maker?
When you add a limit order to the order book, you are a market maker.
For big traders, like institutions for instance, it´s common to take the role as market makers. Of course, small traders can become makers by placing a limit order into the order book also. However, this doesn´t add as much liquidity as an institution can be able to do.
Who is a Market Taker?
A market taker is a trader removes liquidity from the market. That liquidity was provided by the market maker.
For a taker, orders on the order book are filled immediately.
Maker and Taker Fee on Binance
Binance apply maker and taker fee to all trading fees charged by Binance.
In the screenshot below, you can see the maker and taker fee for spot trading.
Note that Binance is offering three different ways to pay a lower commission.
- One way is to pay the fees in the Binance BNB token and you will get 25% lower fees.
- The other way to get lower fees on Binance is to use our referral ID which will give you another 20% lower fees on Binance.
- The third option is to hold their native token, Binance coin BNB or trade large volumes. You can reach higher VIP levels by doing this as you can see in the screenshot below.
If you want to read further about fee on Binance you should check out our dedicated article, Binance trading fees. Here, you will find how to set to pay all the trading fees with the Binance Coin BNB to enjoy 25% less fees for spot trading.
Read more about Binance in our Binance Review.
Binance Referral Code: -20% on all commissions with our link
Maker and Taker Fee on Binance by Binance Academy
Binance have started their own educational platform called Binance Academy. In the video below, Binance Academy describes maker and taker fee on Binance.
Maker and Taker Fee on Kraken
Kraken is an US crypto exchange and trading platform with decent fees and good trading volumes.
You can use the “Instant Buy” feature but they will charge 0.9% fee for any stablecoins and
1.5% fee for any other crypto or FX pair. It´s better to use the Kraken Pro feature which is a trading application with more features and lower fees.
Spot trading fees on Kraken Pro ranges from 0.26% to 0.10% as you can see in the screenshot below. However, if you do have large 30 day trading volumes, maker fees can go down to 0%. Read more about this platform in our Kraken review.
For Kraken, the only way to reach higher tier levels and pay less fees is to have large trading volumes. With Binance and Kucoin there is an option to hold their native token to reach higher tier levels.
Maker and Taker Fee on ByBit
ByBit has a simple trading fees table as you can see in the screenshot below. Here, everyone will have to pay the same fee no matter of your trading size.
However, they still differentiate between maker and taker fee as you can see. Also, they charge different fees for spot trading and derivative contracts, as all platforms do.
Read more in our ByBit Review.
Maker and Taker Fee on KuCoin
Kucoin has a similar maker and taker fees table to Binance.
Here, you can get lower spot trading fees by holding their native token or by having large trading volumes.
KuCoin spot trading fees rules
- KuCoin will snapshot users’ KCS holdings and their total trading volume every day for calculation of Tier levels
- Users need to meet one of the listed requirements in the screenshot below.
- User’s Tier level and corresponding trading fees are in effect for 24 hours, and automatically renewed daily.
Conclusion for Maker and Taker Fee
As you can see in the article, some crypto trading platforms charge the same maker as taker fee while others can differ about 0.1%. This will not have any vital impact for a small number of trades.
However, if you are a frequent trader or do many trades over time this will have a large impact on how much you pay in fees.
Even more important is to find out if there are other ways to reduce your trading fees. For example, Kraken, Binance and Kucoin apply tier levels which you can reach in different ways.
To complement knowledge, we would recommend our readers to check out our articles about crypto trading platforms with the lowest trading fees.