A maker is a trader whose order rests on the order book and waits for someone else to fill it. That order adds liquidity. A taker is a trader whose order fills straight away against orders already on the book. That order removes liquidity. Order-book venues usually price the two roles differently. Liquidity-adding orders get a lower fee or sometimes a rebate, and liquidity-removing orders pay a higher fee. Your role is set by each order, not by your account: the same trader can be a maker on one trade and a taker on the next.
How an order book decides who is maker and who is taker
An order book has two sides. Bids are the resting buy orders and asks are the resting sell orders. The gap between the highest bid and the lowest ask is the bid-ask spread.
- Maker order: a limit buy below the best ask, or a limit sell above the best bid. It does not match anything when it arrives, so it rests on the book and adds depth.
- Taker order: any order that matches resting orders as soon as it arrives. A market order is always a taker. A limit order whose price reaches the other side of the book is also a taker. A buy limit at or above the best ask fills immediately and is charged as a taker, even though it was entered as a limit order.
The second case is the most common reason a trader expecting a maker fee pays the taker fee. A limit order guarantees a price, but it does not guarantee you are adding liquidity.
What happens when a taker order is larger than the best price level
A market order fills at the best available price first. If it is larger than the size resting at that level, it moves on to the next level, then the next. The average fill price ends up worse than the quote the trader saw. This is slippage, and it is a cost on top of the fee. A maker order cannot slip in this way, because it fills only at its limit price or better. The trade-off is that it may never fill at all. The SEC's investor guidance on order types makes the same point: a limit order protects the price, not the execution.
Why venues charge makers less
Resting orders are what make a market usable. Without them a taker has nothing to trade against. The maker-taker model pays for that. US equity regulation describes it as a trading center paying a rebate to the liquidity provider and charging a fee to the liquidity taker, and keeping the difference.
US stock exchanges show how far regulators have gone in setting these prices:
- Under Rule 610 of Regulation NMS, the fee for accessing a protected quotation in a stock priced at $1.00 or more was capped at $0.003 per share.
- On 18 September 2024 the SEC adopted amendments that cut that cap to $0.001 per share, or 0.1% of the quotation price for stocks under $1.00. The amendments also require exchanges to make all fees and rebates "determinable at the time of execution."
- Compliance has been pushed back twice. An exemptive order on 31 October 2025 moved it to the first business day of November 2026. A further order on 11 June 2026 (Release No. 34-105656) extended the relief to the first business day of November 2027.
These rules cover US-listed stocks only. Crypto order-book venues set their own maker and taker schedules, and the rates differ widely between venues and between account tiers. Use the fee schedule your venue publishes rather than an industry average.
Post-only orders: making sure you stay a maker
A post-only order is a limit order that is not allowed to remove liquidity. What happens when it would cross the book depends on the venue:
- Cancelled: the order is rejected rather than filled as a taker.
- Repriced: the order is moved one tick away from the opposing best price and rests there. Nasdaq's rule text treats its standard Post-Only Order this way. Its Retail Post-Only Order is cancelled instead.
Check which behaviour your venue uses before you rely on it. With a repriced order you may rest at a price you did not choose. With a cancelled order you may miss the trade entirely.
Will your order pay the maker or the taker fee?
Answer a few questions about the order you plan to place to see which role, and which fee, it usually gets.
What kind of order are you placing?
- Market order → Taker
- Limit order → next question
- Stop order (stop or stop-limit) → next question
- Swap in a basic automated market maker (AMM) pool → Taker
Does your limit price reach the other side of the book? For example, a buy at or above the best ask, or a sell at or below the best bid.
- No, it sits away from the opposing best price → Maker
- Yes, it would match resting orders on arrival → next question
Is the order marked post-only?
Is it a standard stop order or a stop-limit order?
- Standard stop → Taker once triggered
- Stop-limit → Becomes a limit order once triggered
A market order is always a taker. It removes liquidity, usually pays the higher fee, and if it is larger than the size at the best price level it fills across further levels and slips.
The order does not match anything when it arrives, so it rests on the book and adds liquidity. It usually gets the lower fee or sometimes a rebate, fills only at your limit or better, and may never fill.
A limit order that reaches the other side of the book fills immediately and is charged as a taker. A limit order guarantees a price, not that you are adding liquidity.
A post-only order is not allowed to remove liquidity. Depending on the venue it is either cancelled, so you may miss the trade, or repriced one tick away from the opposing best price, so it may rest at a price you did not choose. Check which behaviour your venue uses.
When the stop price is reached the order becomes a market order. It pays the taker fee and the fill can be far from the stop price when prices move fast, often when the book is thinnest.
A triggered stop-limit becomes a limit order, which caps the fill price. The cost is that it may not execute at all if the price moves past the limit.
A basic AMM pool has no order book, so you cannot place a resting limit order. Every swap trades directly against the pool and is a taker trade.
This shows the usual role for each order type only: it gives no fee rates, cannot tell you your venue's post-only behaviour or account tier, and leaves out spread and slippage costs.
Stop orders are taker orders
A standard stop order is a trigger. When the stop price is reached, it becomes a market order. SEC investor bulletins warn that the fill can be far from the stop price when prices move fast. Short-lived price swings can also trigger a stop. In practice a stop-loss exit pays the taker fee and may also slip, often in the conditions where the order book is thinnest.
A stop-limit order becomes a limit order instead, which caps the fill price. The SEC's guidance notes the cost: the order may not execute at all if the price moves past the limit.
What maker vs taker costs you in practice
| Maker order | Taker order | |
|---|---|---|
| Effect on the book | Adds resting liquidity | Removes resting liquidity |
| Typical order types | Limit order that does not cross; post-only | Market order; limit order that crosses the spread; triggered stop |
| Fee on order-book venues | Lower, sometimes a rebate | Higher |
| Price | Your limit or better | Best available price, can slip across levels |
| Main risk | Order never fills | Slippage plus the higher fee |
The spread matters as well as the fee. A taker who buys at the ask and later sells at the bid pays the spread on top of two taker fees. The full cost of a round trip is fees plus spread plus any slippage, not the fee line alone.
Order books vs automated market makers
Many decentralised exchanges have no order book. They use an automated market maker (AMM): a smart-contract pool holding two assets, priced by a formula. Constant-product pools, often with concentrated liquidity, are the most common design.
The roles map like this:
- Liquidity providers deposit assets into the pool and earn a share of trading fees. Research on these pools finds that a provider's result depends on fee income, the value of their holdings in the pool, and rebalancing costs. Fee income alone does not guarantee a profit.
- Liquidity takers swap directly against the pool. You cannot place a resting limit order in a basic AMM pool, so every swap is a taker trade.
Summary
- A maker's order rests on the book and adds liquidity. A taker's order fills immediately and removes it.
- A limit order counts as a maker order only if it does not cross the spread. Post-only stops it from crossing, either by cancelling the order or by repricing it, depending on the venue.
- Market orders and triggered stop orders are taker orders.
- Compare the full cost (fee, spread and slippage) on the venue's published schedule, not a headline rate.
Limitations: the regulatory figures and dates cover US equity markets only. Crypto venue fee levels are not covered because they vary by venue and change often.
This article explains how markets work and is not trading or investment advice.
