• Maker

If a trade order adds liquidity to the order book, it is a market maker. When you see “adds liquidity”, it means placing a trade order that does not match immediately against an order already on the order book so you are helping to “make the market”. This is done by placing limit buy orders below the current price, or limit sell orders above the current price.

  • Taker

If a trade order take away liquidity from the order book, it is a market taker. This is very easy to understand. When you take an order away from the order book, you remove the liquidity. This is done by placing a market order, which you agree with the currently listed prices on the order book and wish to fill the trade immediately. Once you send out the order, it will be executed immediately without even going onto the order book.

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