Maker vs Taker Fees Explained — and How to Pay Less

If you've ever looked at a crypto exchange's fee structure, you've probably seen terms like "maker" and "taker" fees. Understanding the difference between these two fee types is crucial for minimizing your trading costs and maximizing your profits.

In this comprehensive guide, we'll explain exactly what maker and taker fees are, why they exist, and most importantly, how you can use this knowledge to pay significantly less in trading fees.

What Are Maker and Taker Fees?

Maker Fees 🏗️

Makers are traders who "make" the market by placing orders that don't execute immediately. They add liquidity to the order book.

• How it works: You place a limit order that sits in the order book waiting to be filled
• Example: Bitcoin is trading at $45,000. You place a buy order at $44,950
• Typical fees: 0.02% - 0.15% (usually lower than taker fees)

Taker Fees 🏃

Takers are traders who "take" liquidity from the market by placing orders that execute immediately against existing orders.

• How it works: You place an order that matches with an existing order in the book
• Example: Bitcoin is trading at $45,000. You place a market buy order that executes immediately
• Typical fees: 0.04% - 0.25% (usually higher than maker fees)

Why Do Exchanges Charge Different Rates?

The Liquidity Incentive System

Exchanges want to encourage liquidity because it:

• Attracts more traders (better prices, tighter spreads)
• Reduces price volatility (more orders = more stable prices)
• Improves user experience (faster execution, better fills)

Solution: Reward makers with lower fees and charge takers more.

Real-World Example

Think of it like a marketplace:

• Makers are like vendors who set up stalls and wait for customers (they provide inventory)
• Takers are like customers who buy immediately from existing stalls (they consume inventory)
• The marketplace (exchange) gives discounts to vendors to encourage them to set up stalls

Fee Comparison Across Major Exchanges

Note: Some exchanges have the same maker/taker fees, while others offer significant savings for makers.

How to Become a Maker (and Pay Less)

1. Use Limit Orders Instead of Market Orders

Market Order (Taker) ❌

Current BTC price: $45,000
You place: Market buy order
Result: Executes immediately at $45,000
Fee: Taker fee (higher)

Limit Order (Maker) ✅

Current BTC price: $45,000
You place: Limit buy order at $44,950
Result: Order sits in book, fills when price drops
Fee: Maker fee (lower)

2. Strategic Order Placement

For Buying (Going Long):

• Place limit orders below current market price
• Example: If BTC is $45,000, place buy orders at $44,950, $44,900, etc.
• Benefit: Get better prices AND lower fees

For Selling (Taking Profits):

• Place limit orders above current market price
• Example: If BTC is $45,000, place sell orders at $45,050, $45,100, etc.
• Benefit: Get better prices AND lower fees

3. Use Post-Only Orders

Many exchanges offer "Post-Only" order types that guarantee maker fees:

• Guarantee: Order will only execute as a maker
• Safety: If it would execute as a taker, it gets canceled instead
• Benefit: Never accidentally pay taker fees

Advanced Maker Strategies

1. Ladder Orders

Place multiple orders at different price levels:

Current BTC Price: $45,000

Buy Orders (Ladder Down):
- $44,950 (0.2 BTC)
- $44,900 (0.3 BTC)
- $44,850 (0.5 BTC)

Sell Orders (Ladder Up):
- $45,050 (0.2 BTC)
- $45,100 (0.3 BTC)
- $45,150 (0.5 BTC)

Benefits:

• Multiple chances to get filled
• Average better prices
• All orders qualify for maker fees

2. Market Making Strategy

Continuously place buy and sell orders around the current price:

Current BTC Price: $45,000

Place simultaneously:
- Buy order: $44,990 (maker fee)
- Sell order: $45,010 (maker fee)

When one fills, replace it immediately

Benefits:

• Profit from bid-ask spread
• Always pay maker fees
• Generate income from volatility

3. Time-Based Strategy

Take advantage of market patterns:

• Low volatility periods: Place orders closer to market price
• High volatility periods: Place orders further from market price
• News events: Avoid trading or use wider spreads

When Taker Fees Make Sense

1. Fast-Moving Markets

Sometimes paying taker fees is worth it:

• Breaking news: Need immediate execution
• Strong momentum: Don't want to miss the move
• Stop losses: Immediate execution is crucial

2. Arbitrage Opportunities

When price differences between exchanges are large:

• Time-sensitive: Opportunities disappear quickly
• Profit margin: Higher than the extra fee cost
• Volume: Large trades where speed matters

3. Emergency Situations

• Liquidation risk: Need to close positions immediately
• Market crashes: Better to pay fees than lose more money
• Technical issues: When limit orders aren't working

Fee Calculation Examples

Example 1: $10,000 BTC Trade on Kraken

As a Taker:

• Fee: $10,000 × 0.26% = $26
• Net cost: $10,026

As a Maker:

• Fee: $10,000 × 0.16% = $16
• Net cost: $10,016
• Savings: $10 (38% less fees)

Example 2: $100,000 ETH Trade on FTX

As a Taker:

• Fee: $100,000 × 0.07% = $70
• Net cost: $100,070

As a Maker:

• Fee: $100,000 × 0.02% = $20
• Net cost: $100,020
• Savings: $50 (71% less fees)

Tools and Features to Help You

1. Order Types That Help

• Post-Only: Guarantees maker fees
• Fill-or-Kill: Executes completely or cancels
• Immediate-or-Cancel: Executes partially, cancels remainder

2. Exchange Features

• Fee calculators: Preview fees before placing orders
• Order book depth: See where to place maker orders
• Price alerts: Know when your orders might fill

3. Trading Bots

• Grid trading bots: Automatically place ladder orders
• Market making bots: Continuously provide liquidity
• DCA bots: Dollar-cost average with limit orders

Common Mistakes to Avoid

1. Always Using Market Orders

• Problem: Always paying higher taker fees
• Solution: Use limit orders when time isn't critical

2. Placing Orders Too Close to Market

• Problem: Orders execute immediately as taker
• Solution: Leave some buffer between your order and market price

3. Not Understanding Order Types

• Problem: Accidentally paying taker fees
• Solution: Learn your exchange's order types and use post-only when available

4. Ignoring Market Conditions

• Problem: Placing maker orders during high volatility
• Solution: Adjust strategy based on market conditions

Volume-Based Fee Reductions

Many exchanges offer additional discounts based on trading volume:

Binance VIP Levels

How to Maximize Volume Discounts:

1. Concentrate trading on one exchange
2. Include all trading types (spot, futures, options)
3. Consider exchange tokens for additional discounts
4. Track your monthly volume to reach next tier

Exchange Token Benefits

Many exchanges offer additional fee discounts for holding their tokens:

Examples:

• Binance (BNB): 25% fee discount
• KuCoin (KCS): Up to 20% discount
• FTX (FTT): Tiered discounts up to 60%
• OKX (OKB): Up to 30% discount

Strategy:

1. Calculate break-even: How much token to hold vs fee savings
2. Consider price risk: Token value can fluctuate
3. Monitor changes: Discount rates can change

The Psychology of Maker vs Taker

Why Traders Often Pay Taker Fees:

1. Impatience: Want immediate execution
2. FOMO: Fear of missing out on price moves
3. Lack of knowledge: Don't understand the difference
4. Convenience: Market orders are simpler

How to Develop Maker Discipline:

1. Set price targets: Know your entry/exit points in advance
2. Use alerts: Get notified when price approaches your levels
3. Practice patience: Remember that lower fees compound over time
4. Track savings: Monitor how much you save with maker orders

Advanced Fee Optimization

1. Cross-Exchange Arbitrage

• Strategy: Buy on one exchange, sell on another
• Fee consideration: Factor in both exchanges' fees
• Timing: Use maker orders when possible

2. Futures vs Spot Arbitrage

• Strategy: Trade price differences between spot and futures
• Fee advantage: Futures often have lower maker fees
• Risk management: Understand funding rates

3. Seasonal Patterns

• Observation: Fee structures sometimes change
• Strategy: Time large trades around fee promotions
• Planning: Budget for fee changes in trading plans

Conclusion: Your Action Plan

Immediate Steps:

1. Check your exchange's fee structure - Know the exact maker/taker rates
2. Switch to limit orders - Start using limit orders for non-urgent trades
3. Learn post-only orders - Use them to guarantee maker fees
4. Calculate your potential savings - See how much you could save monthly

Long-term Strategy:

1. Develop maker discipline - Plan trades in advance
2. Monitor volume discounts - Work toward higher VIP levels
3. Consider exchange tokens - Evaluate if fee discounts are worth it
4. Track your fee expenses - Monitor and optimize regularly

Key Takeaways:

• Maker fees are typically 20-70% lower than taker fees
• Limit orders usually qualify for maker fees (if they don't execute immediately)
• Post-only orders guarantee maker fees but may not fill
• The savings compound over time - especially for active traders

Remember: Every dollar saved on fees is a dollar added to your profits. For active traders, the difference between maker and taker fees can mean thousands of dollars in savings per year.

Start implementing these strategies today, and watch your trading costs decrease while your profits increase.

---

Want to calculate exactly how much you could save with maker fees? Use our trading fee calculator to see your potential savings across different exchanges and trading volumes.