After starting their journey in 2011, Kraken exchanges has become one of the most popular and widely used Bitcoin exchanges in the network. The San Francisco-based company is a preferable to the professional traders for their innovative features, fast execution, high security and exceptional support. It maintains an exclusive partnership and full regulatory compliance with vast number of traders around the globe, the Tokyo government, and Fidor Bank regulated by BaFin.
The company is the prominent Bitcoin exchange dealing in Euros as well as favoring few other currencies such as the US dollar, the Yen and the Canadian dollar. Kraken is constantly being praised as the top Bitcoin exchange by third party news media. It was the first Bitcoin exchange to be enlisted by Bloomberg terminals.
Earlier today, the company posted a blog announcing their decision to reduce all market fees. Kraken will integrate a new “maker-taker model” which includes a reduction in the platform trading fees. According the post, this maker-taker model service will ensure a reduced fee for the market makers who offer liquidity to the market takers. This decision comes as a result of a public demand that has been asking for a lower fee system. And this maker taker model will give the clients a much simpler and reduced fee structure.
How does it work?
The maker fee is applicable to situations where the trader provides liquidity to the order book by ordering a limit buy below market price or a limit sell above market price. The fee will only be paid to the maker (maker fee) when such orders are taken by new incoming orders. Accordingly, the taker fee is applicable to situations where the trader confiscates liquidity from the book by ordering a market or limit buy that carries out straightaway in response to an already placed limit order on the book.
As described above, any upfront orders will trigger either market or limit orders and the maker or taker will be the triggered market or to limit order.
Benefits of maker-taker model
Traders who will provide liquidity in the order book will be benefited from this new system. And traders who will remove liquidity from the order book will also be benefited from this reduced fee system compared to the usual fee system. Even though takers pay only o.10% more than makers, the maker-taker model will offset this through deeper liquidity and tighter spreads.
In terms of bitcoin-fiat trades, the maker fee goes as low as 0% and up to 0.16% depending upon the traded amount. The taker fee goes as low as 0.10% and up to 0.26% depending upon the amount that is being traded.
With this new maker-taker model, the crypto-crypto trades will also have a new structure due to the overall reduced fees. However, the maker-taker model is not integrated in terms of dark pool fees even though it has also been changed. The reason for this is that the maker taker model is only beneficial when you can view the order book.
This new fee structure will be activated from 1st August, 2015.
- Latest Posts