What is Maker
Maker: Refers to the order placed by the party who quotes first, that is, to set up an order first, limit its price and quantity, and wait for other users to make a deal with it. If there is no matching order in the market for the time being, then this order will always be hung on the exchange’s order book to provide quotations for the entire market.
What is Taker
Taker: Refers to take the initiative to deal with the orders that have been placed, that is, to place a certain number of orders based on the existing order prices on the exchange order, and immediately execute the orders placed on the order. If the entrustment demand of the taker is large and the supply exceeds the demand, the unsatisfied demand will become a new entrustment order as a pending order and continue to wait for the transaction if the order is not cancelled.
What Are Limit Orders
Definition: A limit order specifies a price and quantity (the order enters the order book after placement).
A limit order allows users to set the order quantity and the maximum acceptable purchase price or minimum acceptable selling price. When the market price meets the user’s set conditions, the system will execute the order at the best price within the limit range.
Example: If the current BTC market price is 53,000 USDT and you want to buy at a cheaper price of 52,900 USDT, you can place a limit order at 52,900. Once the market price drops to 52,900 USDT or lower, your order will be automatically executed.
What Are Market Orders
Definition: A market order buys or sells at the best available price in the market.
A market order allows users to execute a trade immediately at the current best market price, ensuring fast transactions.
Example: If the latest BTC price is 53,000 USDT and you want to buy BTC immediately at market price, you can place a market order and specify the total amount, such as 40 USDT. The order will be executed immediately. In a highly volatile market, the execution price may not be exactly 53,000 USDT—it could be higher or lower depending on real-time market fluctuations.
Differences Between Limit Orders and Market Orders
- A limit order requires manual input of the desired transaction price, whereas a market order does not require a price and executes immediately at the current market rate.
- A single market order cannot exceed a total value of 100,000 USDT. If it does, the order will fail.
- Limit orders do not freeze trading fees before execution, while market orders will have trading fees temporarily frozen until the order is completed.
What’s Impermanent Loss
Impermanent loss refers to the temporary loss incurred by liquidity providers (LPs) in an Automated Market Maker (AMM) environment due to market price fluctuations. When prices rise or fall, the value of assets obtained after withdrawing liquidity may be lower than the value of simply holding the assets. This loss occurs because of the constant product pricing mechanism of AMM. As prices revert, impermanent loss will gradually diminish.
Example of Impermanent Loss
- Assume a liquidity pool contains 1,000 POL and 500 USDT, with a constant product of 1,000 * 500 = 500,000. Liquidity provider Lares holds 10% of the POL/USDT pool, or 100 POL and 50 USDT, where 1 POL = 0.5 USDT.
- Over time, the price of POL increases, changing the asset ratio to 500 POL and 1,000 USDT. The constant product (500 * 1,000 = 500,000) remains unchanged, and 1 POL = 2 USDT. Lares’ share changes to 50 POL and 100 USDT.
- If Lares withdraws liquidity, they will receive 50 POL and 100 USDT, valued at 50 * 2 + 100 = 200 USDT.
- If Lares had held 100 POL and 50 USDT without providing liquidity, their assets would now be worth 100 * 2 + 50 = 250 USDT. The difference (50 USDT) represents impermanent loss.
How to Mitigate Impermanent Loss
Impermanent loss is common in early market-making or one-sided market trends. It can be mitigated over time as transaction fees accumulate and prices stabilize, eventually leading to realized market-making profits.
What’s TP/SL in Spot trading
Stop-profit and stop-loss are a type of strategic commission. Users can pre-set the trigger price and order price. When the market price reaches the trigger price, the system will automatically place an order based on the order price. Users can use this order to buy at a low price or sell at a high price. The user’s funds will not be frozen when placing a stop-profit and stop-loss order. When the trigger price is reached and the corresponding order is generated, the user’s funds will be frozen.
About SuperEx
As the world’s first Web3-powered cryptocurrency exchange, SuperEx has remained committed to building the Web3 ecosystem. Over the years, it has introduced a comprehensive range of products and services, including SuperEx DAO, SuperEx Web3 Wallet, Super Start, SuperEx P2P, SuperEx Stock Markets, SuperEx Copy Trading, SuperEx Earn, and SuperEx DAO Academy, creating a full-spectrum ecosystem that spans every major sector of Web3.
Today, SuperEx serves over 10 million users, with a social media community of more than 600,000 followers across 166 countries and regions worldwide. The platform supports 1,000+ cryptocurrencies for both spot and futures trading. Seamlessly integrated with Super Wallet, SuperEx provides decentralized asset custody while combining the trading efficiency of a centralized exchange (CEX) with the security of a decentralized exchange (DEX).
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