Maker Taker Model

The maker taker model is a fee structure used by many exchanges to encourage liquidity provision. Makers, who provide liquidity by placing limit orders, are often charged lower fees or even given rebates.

Takers, who consume liquidity by placing market orders, pay higher fees. This model is designed to incentivize traders to post orders that deepen the order book, thereby improving market quality.

It is a key factor in how market microstructure is organized and how trading costs are distributed. For high-frequency traders and market makers, the rebate can be a significant part of their profit strategy.

It illustrates how exchanges influence participant behavior through economic incentives.