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Author: Admin | 2025-04-28
Necessarily buying low and selling high, as is the case with traditional trading.Additionally, market makers usually charge cryptocurrency exchanges a general fee for their services. This fee serves as an additional source of income for market makers, contributing to their overall revenue. The size of this fee can vary and is often determined by various factors such as the exchange's policies and the volume of trading activity.The bid-ask spread is a significant aspect of the market maker's revenue model. A wider spread translates to higher profits for the market maker. However, a market with a large number of traders and market makers tends to have strong competition, leading to narrower spreads. A narrow bid-ask spread is favorable as it increases the likelihood of successful transactions. If the spread is too high, it can deter traders and negatively impact the volume of transactions, thus affecting the market maker's profits.Disclaimer: This article was produced with the assistance of OpenAI’s ChatGPT 3.5/4 and reviewed and edited by our editorial team.© 2024 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.AUTHOR Tim is the Editor-In-Chief of The Block. He writes about the evolution of crypto technology and the people who are at the forefront of it. He provided exclusive, source-based insights into the launches of the Bitcoin and Ethereum ETFs, crypto sales by the FTX Estate and the Trump-linked World Liberty Financial project. Prior to joining The Block, Tim was a news editor at Decrypt. He earned a bachelor's degree in philosophy from the University of York and studied news journalism at Press Association Training. Follow him on X @Timccopeland. See More WHO WE ARE The Block is a news provider that strives to be the first and final word on digital assets news, research, and data. + Follow us on Google News More by Tim Copeland
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