What Are Market Makers and Market Takers?

A Maker refers to someone who places an order which will not be executed in the market immediately. Instead, it enters the order book, ready for other traders to match. This process is called “placing a limit order”.

2. Taker

A Taker refers to someone who places an order that immediately matches the orders placed on the order book. This process is called “taking an order”.

3. Conclusion

(1) In each trade, there are two roles: Maker and Taker. The Maker is the party who places the order first, while the Taker submits theirs subsequently.

(2) Makers engage in passive trading, while Takers engage in active trading. When the demand for a Taker's order exceeds the available supply, the unmatched portion of the Taker's order will convert into a Maker position, waiting to be matched.