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Crypto market making is the practice of providing continuously buy and/or sell liquidity to a digital asset’s order book by placing limit orders at pre-defined price levels, a process that helps to improve market depth and spreads.
What Is Crypto Market Making and Why Does It Matter?
How Market Makers Keep Crypto Markets Liquid
Crypto market makers quote a bid and an ask at the same time, creating available counterparties without buyers and sellers needing to arrive at the venue at the same time. Deeper order books allow trades to occur closer to market prices and with lower impact.
Market makers are likely to change their quotes when the price and liquidity conditions change, due to the rapid changes in depth in the crypto markets.
Why Liquidity Matters for Token Projects
Liquidity is defined as how easy it is for a market participant to open a position or to exit a position in a token without moving the market price too much. Thin liquidity has wide spreads and high slippage, and deep liquidity can absorb larger trades.
Thus, crypto liquidity management is not merely a problem of volume, but also a problem of market quality, with smaller markets or liquidity pools being more exposed to slippage.
| Market | How Liquidity Is Provided | Typical Mechanism | Main Liquidity Goal |
| CEX | Market makers place buy and sell orders in an exchange order book | Limit orders and algorithmic quoting | Tighter spreads, deeper order books, lower slippage |
| DEX | Liquidity is supplied through pools or professional on-chain strategies | AMMs, liquidity pools, DEX market making | Efficient swaps, sufficient pool depth, lower price impact |
| Both | Liquidity providers adjust capital and execution according to market conditions | Automated liquidity management | Stable trading conditions and better execution quality |
The Role of Market Makers in CEX and DEX Markets
Market makers on centralized exchanges provide liquidity by using limit orders in the exchange’s order book to support trades with lower slippage in sufficiently liquid markets.
On DEXs, liquidity works differently, as most decentralized exchanges use automated market makers and liquidity pools, though a few decentralized exchanges use order books. Professional crypto liquidity providers therefore need to manage different liquidity pools – and different execution structures – for CEXs and DEXs.
What Does a Crypto Market Maker Do for a Token?
The market maker provides two-sided liquidity and adjusts their orders based on market conditions. Professional crypto market making services are usually provided to token issuers to maintain healthy trading in the token and provide sufficient market depth, rather than to control the price of the token.
Maintaining Bid and Ask Liquidity
Market makers place buy and sell orders around the market price to provide liquidity on either end of the order book. Market makers are typically evaluated by exchanges based on maker volume, bid-offer spread, and order size.
They also update orders as supply, demand and available depth change. In August 2026, Coinbase claimed that during July 2026, liquidity on the bid-side dropped off, while more liquidity on the ask-side emerged.
Reducing Spreads and Slippage
Another competitive two-sided quoting feature is promoting tighter bid-offer spreads, including increased depth. In its list of performance metrics for its market makers, Binance cited bid-offer spread and order size as evidence of successful market making.
This is especially true when the size of the trade is larger, since there is more available liquidity (more orders) to fill before moving deeper into the book.
Supporting Exchange Listings
Market makers can directly make markets in liquidity at trading launch for a new asset listing, creating liquid bid and ask books, which shows that liquidity provision is a formal metric that is incentivized by exchange-based programs. Binance has liquidity programs for spot trading, including some selected altcoin pairs.
However, the hiring of a token market maker does not guarantee a listing on an exchange, as exchanges self-list at their own discretion according to their internal processes.
Managing Liquidity After Token Launches
Crypto market making for token launches also continues after the first trade occurs. Liquidity providers can continue their quoting by changing their order sizes and spreads based on volume and other market factors.
Liquidity can, however, be asymmetric rather than purely disappear. For example, in 2026, Coinbase Research noted that BTC▲$62,630.00 and ETH▲$1,761.17 order books differed in bid and ask depth.
Handling Volatility, Unlocks, and Large Sell Orders
Further, in times of crashes and volatility, the bid side can be consumed quickly, in which case a good market maker can react by adjusting the quotes, sizes, and inventory exposure.
However, this does not mean the market maker can fully counteract token unlocks or large sell pressure. The market maker only controls available liquidity and conditions on order execution. Genuine market making does not guarantee that a token will be maintained at a certain price point.
What Makes a Crypto Market Maker One of the Best?
The best crypto market makers are measured not by headline volume, but by observable metrics such as venue coverage, spreads, depth, uptime, execution infrastructure, reporting and regulatory/tax compliance. GSR, for example, regularly reports its market making KPIs, including spread, depth, volume, market share, uptime and volatility.
Exchange Coverage and Market Access
Broad exchange connectivity allows the market maker to post liquidity across multiple order books. GSR says they have more than 60 CEX and DEX listings, and this is one example of an infrastructure approach utilized by large crypto market making firms.
Coverage is not the only question; the firm also needs to support the exchanges, trading pairs, and market structures required by a particular token.
Order Book Depth and Spread Quality
Strong liquidity is defined by tight spreads and high depth. The performance of a maker on Binance is evaluated through maker volume, bid-offer spread, total order size, and order duration. GSR also employs spread and depth KPIs.
Bid-ask depth is also relevant on both bid and ask sides. In August 2026, Coinbase Research showed BTC and ETH books that remained ask-heavy even as liquidity on the bid side fell, suggesting headline liquidity figures may not capture the real state of the market.
Liquidity Management Technology
Market-making requires automated systems that monitor the market and adjust orders. According to GSR, its institutional software is built in-house and operates at highly granular levels across more than 60 integrations with exchanges.
For token projects comparing crypto market making firms, infrastructure should not be a unique selling point, but rather one of multiple factors to factor in alongside exchange connectivity and risk controls.
Trading Volume and Execution
The firm’s trading volume may be one of the measures used to describe size, along with variables like trade execution efficiency. GSR has said that it processes more than $1 trillion in trades and 150 million orders a day. Binance has also stated that maker volume is only one aspect of market-maker performance.
Execution quality is most important for larger orders, as they are often subject to larger slippage and market impact due to lack of market depth. According to research from Coinbase, cross-exchange liquidity helps reduce slippage.
Track Record With Crypto Tokens
Exposure across different assets and market conditions is another useful criterion. GSR is reported to trade in 250 types of digital assets. It also states that its market-making operation works for both early-stage and established tokens.
However, a track record should be based on verifiable activity and experience with the token rather than just marketing.
Transparency and Performance Reporting
Transparent reporting allows projects to confirm whether the liquidity they are paying for is actually being delivered. Metrics can include spreads, depth, uptime, volume, and market share. GSR says its counterparties receive daily market reports and automated performance analytics.
Reporting is especially useful when liquidity is fragmented across a few trading venues, and aggregate volume may obscure differences in execution quality.
Regulatory Status and Compliance
Regulatory standing became particularly important in 2026, as under MiCA, ESMA maintains a public register of authorized crypto-asset service providers with their authorization status verifiable independently in the EU.
The French AMF lists Keyrock FR SAS as MiCA-authorized since 12 June 2026 and Flowdesk Europe SAS since 25 June. In August, Flowdesk announced a full VARA broker-dealer license in Dubai. GSR reported new registrations in the Cayman Islands, and the acquisition of an SEC-registered broker-dealer in the US.
| Evaluation Factor | What to Check | Why It Matters |
| Exchange Coverage | Supported CEXs, DEXs and trading pairs | Determines where liquidity can be deployed |
| Spread & Depth | Bid-ask spread and order-book depth | Shows actual liquidity quality |
| Execution | Slippage, uptime and order performance | Indicates trading efficiency |
| Technology | Automated quoting and multi-venue infrastructure | Supports continuous liquidity management |
| Track Record | Assets served and relevant token experience | Helps assess operational capability |
| Reporting | Depth, spread, volume and market-share KPIs | Makes performance measurable |
| Compliance | Licenses, registrations and jurisdictional status | Helps assess regulatory risk |
Top Crypto Market Makers in 2026
Top crypto market makers in 2026 are generally algorithmic trading firms, often also institutional liquidity providers with OTC, DeFi and token-launch capabilities that operate at considerably different scale and service models. The following are representative of well-known market makers, and are not necessarily ranked in their performance.
Wintermute
Wintermute is a liquidity provider to token issuers on exchanges, aggregators and brokers, and also offers over-the-counter and decentralized finance (DeFi) services. The company has stated that it has access to more than 70 exchanges and its annual trading volume was $3.5 trillion as of May 2026.
Its regulated footprint was also expanded, with Wintermute USA LLC registering as a broker-dealer with the SEC and a member of the Financial Industry Regulatory Authority (FINRA) in August 2026.
GSR is involved in over-the-counter trading and other digital-asset services. GSR’s market-making business is measured according to liquidity metrics such as spread, depth, volume, market share, and uptime.
Nevertheless, the firm has been involved with digital assets since 2013, making it one of the longest-standing participants among crypto market making companies.
Flowdesk
Flowdesk’s business was based on Market Making as a Service contracts, which aim to give token issuers more control and transparency over liquidity. In 2026, the company stated that it was evolving from MMaaS to becoming an institutional trading and liquidity infrastructure provider.
Flowdesk’s regulatory presence was further expanded in August 2026 when its Dubai entity obtained a broker-dealer VARA licence to provide services such as liquidity provision and market making.
Keyrock
Keyrock says it uses around-the-clock algorithmic market making, gathering liquidity and price data from over 85 exchanges and using algorithms to control the spreads, depth of the order book and execution across its multiple venues.
In June 2026, Keyrock also reported that its French entity had received a MiCA licence, further expanding its regulated European presence.
DWF Labs
DWF Labs is a market maker and Web3 venture capitalist. According to DWF Labs, it offers high-frequency trading services on the spot and derivatives markets across 60+ exchanges, including over-the-counter trading and venture capital services.
This investment and liquidity model distinguishes DWF Labs’s investment strategy from other market makers, who prioritize execution and liquidity.
Auros
Auros describes itself as a global trading firm and liquidity provider and has developed proprietary algorithmic trading and bespoke liquidity solutions from token launch all the way to institutional markets.
The company claims integration with more than 30 centralized exchanges and over 60 decentralized finance venues, with a daily trading volume exceeding $5 billion.
Kairon Labs
Kairon Labs is a crypto project market-making and go-to-market support firm specializing in the analysis of core trading metrics such as order-book depth and bid-ask spreads. In addition to algorithmic trading, it offers launch services for crypto projects.
The firm has also been developing AI strategies like machine learning algorithms and predictive analytics to dynamically adjust its liquidity strategies based on market conditions.
Amber Group
Amber Group provides liquidity to centralized and decentralized exchanges with over $5 billion of daily market making volume, more than 200 quoted tokens, and quoting uptime of 95% or above.
In May 2026, Amber was added to the Forgd market-maker monitoring platform that provides projects visibility into historical spreads, depth, uptime, and execution quality.
Cumberland
Cumberland is an institutional digital asset liquidity provider and market maker. Cumberland’s partnership with GCEX in 2026 enabled a regulated prime-brokerage model for clients accessing its spot crypto liquidity.
The structure is designed to support liquidity for institutional and professional clients and to ensure competitive spreads and execution quality.
B2C2 provides institutional liquidity, market making and OTC trading services on various KPIs, including product uptime, spread, and volume across established protocols and newly listed assets.
Founded in 2015 and acquired by SBI in 2020, B2C2 obtained MiCA authorization in Luxembourg in May 2026. The company also provides liquidity across more than 75 crypto and fiat pairs.
| Market Maker | Core Focus | Reported Market Reach | Notable Feature |
| Wintermute | Institutional & token liquidity | 70+ exchanges | OTC and DeFi capabilities |
| GSR | Market making & institutional trading | 60+ CEX/DEX integrations | Detailed liquidity KPIs |
| Flowdesk | Token liquidity infrastructure | Multi-venue | MMaaS and issuer transparency |
| Keyrock | Algorithmic market making | 85+ exchanges | Multi-venue liquidity technology |
| DWF Labs | Market making & Web3 investment | 60+ exchanges | Trading plus venture investment |
| Auros | Algorithmic & token liquidity | 30+ CEXs, 60+ DeFi venues | Token-launch-to-institutional coverage |
| Kairon Labs | Token market making | Multi-exchange | Token launch support |
| Amber Group | Institutional liquidity | CEX & DEX | 200+ quoted tokens |
| Cumberland | Institutional liquidity | Institutional markets | Prime-brokerage connectivity |
| B2C2 | Institutional liquidity & OTC | 75+ crypto/fiat pairs | MiCA-authorized EU entity |
Crypto Market Makers Compared
Crypto market maker comparison goes beyond trading volume or company size. Venue access, CEX and DEX capabilities, launch support, commercial structure and measurable reporting determine how well a provider fits a particular token.
Exchange Coverage
The breadth of services offered varies widely: GSR says it has integrated with 60+ CEX and DEX venues, Keyrock says it serves clients of 85+ exchanges and 1,400 markets, and Auros states it has integrated with 30+ CEXs and 60+ DeFi venues.
For issuers, the most relevant factor is whether a provider serves the venues and pairs on which the token trades. Wintermute uses a broader definition that includes exchanges, aggregators, and retail brokers.
Market-Making Services
Typical core crypto market making services include continuous liquidity, tighter spreads and tighter order books, but increasingly market makers bundle other services along with these. For example, Wintermute combines market making with OTC and DeFi services, while B2C2 combines bespoke liquidity programs with an integrated OTC business for block trades.
GSR performs market making and institutional execution, and provides custom KPI monitoring. This is meaningful because some projects require more than two-sided quoting.
CEX and DEX Support
However, not all providers serve centralized versus decentralized venues equally. For example, GSR has said they provide liquidity across both CEX and DEX venues, while Auros has said they have a large reach across centralized exchanges and DeFi.
Since Wintermute provides exchange liquidity, too, projects should be careful to compare their venue-specific capabilities and not assume that good CEX coverage means good on-chain liquidity capability.
Token Launch Capabilities
Crypto market maker for new tokens may engage in pre-trading, as Wintermute stated it has deep expertise in exchange-listing requirements, and Auros provides token launch assistance, liquidity management, and institutional market access.
Auros, for example, reported supporting GTE and Monad from testnet through mainnet launch in 2025, showing some providers would support projects beyond post-listing liquidity.
Pricing Models
Standardized crypto market makers fees are rarely made public, and B2C2 claims to offer flexible engagement models and bespoke liquidity programs. Crypto market making contracts can depend on the venues, liquidity targets, and performance metrics for which they are set. These will vary between exchanges and market-making firms accordingly.
Thus the project has to compare the economics of its own proposal rather than rely on a standard published rate.
Transparency and Reporting
Reporting is also now considered key to tracking liquidity providers. GSR provides automatic performance metrics and daily reporting on spreads, depth, volume, market share, uptime and other KPIs.
Wintermute advertises transparency in liquidity reporting across pairs and trading venues. Keyrock publishes trading data and statistics upon request. Auros describes its key performance indicators as contractual. This would help the token teams monitor that the liquidity objectives were being adhered to.
How Crypto Market Making Works
Market making is the quoting of prices and altering liquidity based on the prevailing market environment. Professional crypto market making strategies typically include spread management, order-book depth management, inventory management, and execution across multiple trading venues.
Setting Bid-Ask Spreads
The bid-ask spread is the difference between the highest accepted bid price and the lowest accepted ask price quoted by market makers on both the buy and sell sides of the market. Less liquid markets tend to have wider spreads.
Generally, a tighter spread indicates better execution conditions, although spreads are not the only measure of liquidity. For example, Keyrock relies on pricing data from across the market to keep price differences between venues and spreads small.
Managing Order Book Depth
Market makers place orders at many levels on the order book. This increases the order book depth beyond the best bid and ask, allowing larger trades to be executed with less slippage.
Therefore, both depth and spreads need to be monitored together, and a tight top-of-book spread may not equate to sufficient liquidity for a large order.
Managing Token Inventory
Because market makers are constantly buying and selling, their inventory levels fluctuate according to the orders they are processing, and inventory management is one of the controls on the risk associated with providing two-sided liquidity.
Thus, if the book is heavily imbalanced, quotes and available liquidity can be dynamically modified by the market makers in order to preserve the ability to provide liquidity under new order flow conditions.
Rebalancing Liquidity Across Exchanges
Crypto Liquidity is fragmented across venues, with GSR offering direct connectivity to more than 60 centralized and decentralized venues, and Keyrock aggregating liquidity and pricing information across 85+ exchanges.
A multi-venue infrastructure also allows market makers to take advantage of price and liquidity differences, with Keyrock stating its systems check across venues in real time.
Adjusting Quotes to Market Conditions
Quotes are subject to constant change by market making algorithms whose orders are adapted depending on price changes, demand to trade, and available liquidity. The firm Keyrock states that algorithms adjust liquidity during market volatility, increased volume, and token launch.
This allows for an adaptive approach to crypto liquidity management, where spreads, depth and execution parameters can be dynamically adjusted based on how favorable or unfavorable the market is, as opposed to relying on the order-book.
Crypto Market Making Models
There is no standard commercial token liquidity model. GSR identifies loan-plus-optionality and retainer models as common in the crypto industry. Flowdesk currently offers loan-based option or retainer structures, custodian-based arrangements, and balance-sheet support as part of its token-liquidity offering.
Retainer-Based Market Making
Under a retainer structure, the issuer provides the token inventory and quote currency, and pays a subscription fee for the trading infrastructure and market-making services. Flowdesk claims the issuer can define the strategy together with the market maker, and also choose the exchanges and liquidity levels.
This allows the direct service cost to be more visible, albeit at the cost of the project providing working capital.
Token Loan and Call Option Models
In a loan-and-call model, the issuer will lend tokens to the market maker, who will then provide buy-side liquidity. In return, the market maker is given an option to buy the tokens at a predetermined strike price rather than returning them to the issuer.
Compensation therefore can take place as a result of the option and its related trading instead of a monthly fee; careful consideration should be given to the terms due to conflicting economic incentives between issuer and market maker.
Token Purchase Agreements
A direct token purchase also differs from lending inventory, as the purchaser receives the tokens and not a loan in exchange for future repayment.
However, the major providers’ public materials do not include token purchase agreements as a standard product like retainers and loan-and-option models. Flowdesk lists loan, custodian, and balance-sheet options.
Performance-Based Market Making
Performance can also be measured against liquidity KPIs such as bid-ask spread, depth, uptime, and share of top-of-book quoting, rather than raw volume alone. Flowdesk also considers latency and reporting as performance metrics.
However, this does not mean that a KPI-based structured contract is strictly aligned with performance, as it can also be structured with a retainer, or loan-and-option structure.
Market Making as a Service
Market Making as a Service, or MMaaS, is a model in which the provider supplies trading technology and operational expertise while the issuer retains greater control over liquidity strategy and capital. Flowdesk, which pioneered the model, has since expanded MMaaS into broader institutional liquidity infrastructure.
The model can provide real-time visibility into spreads, depth, volume, and market share. For projects evaluating crypto market making services, that transparency can make liquidity performance easier to measure across venues and strategies.
| Market Making Model | Capital / Token Structure | Compensation | Issuer Control |
| Retainer-Based | Issuer provides tokens and quote currency | Recurring service fee | Higher |
| Token Loan + Call Option | Issuer lends tokens; market maker provides buy-side capital | Call option / trading economics | Lower |
| Token Purchase | Tokens are sold rather than loaned | Token purchase economics | Depends on agreement |
| KPI / Performance-Based | Structure varies by contract | Linked or assessed against liquidity KPIs | Depends on agreement |
| MMaaS | Issuer retains greater control over liquidity capital and strategy | Service-based commercial model | Higher |
How Much Does Crypto Market Making Cost?
Market makers do not publish price lists. For example, Flowdesk identifies retainer and loan/call structures, whereas Keyrock states that it makes remuneration and fees known to clients through its pricing policy. The relative price of market making can vary a lot depending on the business model.
Market Maker Retainers
Way 1. Under the retainer model, the issuer pays the market maker a monthly fixed fee (a retainer) for trading activity, set-up, and infrastructure. According to Flowdesk, the issuer generally provides the token inventory and the quote currency (e.g., USDC▲$0.9999) while collaborating with the market maker on the liquidity strategy.
Therefore, published benchmark crypto market maker fees should be interpreted with caution, as larger providers tend to negotiate and not standardize the monthly fees.
Token Inventory Requirements
Depending on the contract, inventory needs may vary: with the Flowdesk retainer, the issuer supplies the tokens and quote currency. The issuer provides the token inventory while the market maker provides the buy-side capital during a loan or call.
It was previously stated by Flowdesk that proprietary borrow amounts can range between 2% and 4% of the total supply, and in some cases above, but this does not reflect the 2026 industry standard, nor is it the norm.
Fees, Discounts, and Other Costs
However, direct retainers only capture part of the economics. Loan/call structures that embed a call option into that structure and trade around the optionality reward the market maker, not the typical service fee.
Where trading venues are involved, centralized and decentralized exchanges have different fee structures. According to Keyrock, DEXes may incur gas costs to the blockchain, and exchanges may create financial incentives to market makers like rebates on trading fees.
What Determines the Cost of Market Making?
Required capital, commercial model and mandate scope all have an impact on cost, as does exchange coverage and target liquidity level, since contracts often specify where the market maker is able to operate and in what quantity of liquidity it is expected to provide.
Performance requirements are also important. For market making proposals, parameters such as spread, order-book depth, uptime, latency, and reporting can vary. A comparison in terms of price alone can overlook important differences in offered service.
Choosing a Crypto Market Maker for a Token Project
The first consideration for provider selection is token stage, venues of interest and liquidity profile. GSR’s main competitive advantages include exchange integrations, CEX/DEX capabilities, reporting, technology, and liquidity delivered.
Market Maker for a New Token Launch
A crypto market maker for new tokens should be able to prepare liquidity in advance of the first trading session, and provide liquidity throughout the digital asset’s life cycle. GSR’s advisory business includes liquidity design, market-making engagement, exchange-listing strategy, and launch planning.
Beginning with the 2016 ICO, launch experience is critical, balancing early liquidity with exchange strategy and token distribution. GSR’s 2026 expansion into integrated advisory services includes token economics, fundraising, exchange strategy, and post-launch operations.
Market Maker for CEX Listings
For projects seeking to list with centralized exchanges, a clear record of connectivity and order-book performance is valuable. GSR lists 60+ CEX and DEX integrations. We also include spread, depth, volume, market share, and uptime as part of our market-making KPIs.
Exchange liquidity should focus on more than just launch day, and GSR’s exchange product offering includes 24-hour liquidity, max spread and market depth KPIs, post-trade analytics, and recurring reports.
Market Maker for Established Tokens
For established assets, providers are required to provide liquidity as volumes and market conditions change. GSR explicitly states it has experience in market making in early-stage tokens and established tokens across centralized and decentralized exchanges.
Complementary OTC infrastructure may also play a role for larger or more complex trades. GSR’s systematic OTC infrastructure handles over 200 digital assets and is high-touch in order to execute blocks with minimal market impact.
Market Maker for DeFi Projects
Given the general nature of DeFi integrations beyond connecting with CEXs, GSR’s DeFi-focused business includes core pillars such as liquidity seeding, market access, market liquidity, and treasury management across DEX market making and arbitrage.
Other DeFi options include initial IDOs and cross-exchange price comparisons. Therefore, a project investigating crypto liquidity providers should look into what protocols, DEXs and on-chain infrastructure a potential partner can provide.
Market Maker for Large-Cap Crypto Assets
For trading large caps, execution capacity matters. For example, from July 2026, GSR started providing two-way Bitcoin and Ether liquidity to TP ICAP’s Fusion Digital Assets and using it for hedging risk elsewhere.
In addition, large trades may either be executed off of public order books orrge or complex trades, and systematic OTC for trades of up to $100 million
| Token Project Type | Key Market Maker Capabilities | Priority Metrics |
| New Token Launch | Launch planning, initial liquidity, exchange coordination | Spread, depth, launch-day uptime |
| CEX Listing | Strong exchange connectivity and order-book management | Spread, depth, volume, uptime |
| Established Token | Multi-venue liquidity and adaptive execution | Depth, slippage, market share |
| DeFi Project | DEX integrations, on-chain liquidity and arbitrage | Pool depth, execution, price consistency |
| Large-Cap Asset | Institutional execution and OTC infrastructure | Market impact, depth, execution quality |
What to Look for in a Crypto Market Making Contract
A market-making contract should define the commercial model, minimum liquidity obligations, capital commitments and performance standards.
Keyrock states that its market-making activities are covered by a Master Services Agreement and a Master Loan Agreement. Flowdesk says it has two types of market-making structures, retainer and loan/call, which differ in terms of capital and control.
Liquidity and Spread KPIs
The agreement should also set clear, concrete liquidity targets instead of broad promises, such as GSR’s market making KPIs: bid-ask spread, volume share and presence, and uptime at the top of the order book. Its trading platform currently tracks depth, market share and volatility too.
Depth must also be considered since a tight spread with low capital allocated could incur high slippage. Flowdesk recommends monitoring of spread, depth, uptime, latency and other metrics.
Token Loans and Call Options
Tokens lent to the market maker should specify the amount, the repayment, and the option it constitutes. In the loan/call Flowdesk model for market making, the issuer would lend the tokens to a trading inventory and issue the option. The market maker has the right to buy tokens at a specified strike price.
Thus, before entering an agreement, projects need to understand the economics of the option, as the market maker may call the option under contract, affecting the issuer’s total supply of tokens.
Inventory and Exposure Limits
The contract should specify who is providing the token and quote currency inventory, and, respectively, who is bearing the capital risk. In Flowdesk’s retainer model, the issuer is providing both. This is Flowdesk’s loan/call model, where the issuer is providing the tokens and the market maker is providing buy-side capital.
Explicit inventory terms are particularly important for crypto markets, which are often volatile, fragmented, and subject to sudden spread widening. For example, Flowdesk’s risk disclosures state that market making cannot guarantee continuous liquidity or a particular spread.
Contract Duration and Termination
Duration, as well as renewal and termination clauses, are very important for token options and token loans. According to Flowdesk’s published analysis, the proprietary terms of trade usually have a duration of several months to one or several years.
The contract must clarify the disposition of borrowed assets and liabilities at termination. In Flowdesk’s retainer-based structure, at the end of a contract the entirety of the loan would be returned.
Reporting and Audit Requirements
Transparent reporting ensures issuers get feedback on whether the agreed KPIs have been met. Flowdesk recommends real-time dashboards or periodic reports with spreads, depth, market share and trading activity, and PnL.
GSR also offers automated reporting and performance analytics, including volume share, order-book depth, and other liquidity metrics through its GSR One product. Contracts should therefore specify what data is provided, at what frequency it is provided, and how performance against KPIs can be checked.
Crypto Market Making Risks
Market making can improve liquidity, but poor or abusive trading terms expose token issuers to trading, counterparty and regulatory risk. Recent US regulatory actions and MiCA’s market abuse framework in the European Union mean that due diligence for market making is especially important.
Artificial Trading Volume and Wash Trading
Wash trading can create a false appearance of trading, but no economic trade takes place. In 2024, the SEC charged a group of alleged market makers with wash trading and artificially inflating crypto-asset volumes. U.S. prosecutors had also filed charges resulting in guilty pleas and sentences.
This is different from true liquidity providing, and the Gotbit case, where artificially inflating volume was used to make a token appear to trade more actively and thereby gain an exchange listing, is a DOJ example.
Token Dumping and Inventory Risk
Market-making contracts are often backed by large reserves of tokens. The actual exposure to tokens may differ based on the contents of the contract, including loans, sales, or options.
Projects should understand the implications of inventory rights and repayment obligations, rather than assuming that supplied tokens will remain economically neutral throughout the mandate.
Conflicts of Interest
Conflicts of interests can arise, for example, if a provider’s remuneration, or its proprietary positions, provides incentives that work against the issuer’s liquidity needs. Transparent mandates, clearly defined KPIs and restrictions on permitted trading behavior alle
And history shows that U.S. authorities have charged arrangements where purported market-making services included manipulative volume generation of the sort at issue here.
Counterparty Risk
Poor Liquidity Performance
Market-making services do not guarantee that markets will be consistently deep and stable. Bad service may be characterized by wide spreads, insufficient depth, poor uptime, and low liquidity during volatility.
Contracts should therefore define measurable liquidity standards and reporting procedures to separate real market quality from just headline trading volume.
Regulatory and Compliance Risks
In different jurisdictions, the treatment of market manipulation can vary. For example, the European Union prohibits market abuse under the Market in Crypto Assets regulation (MiCA), and professionals structuring market trades must implement and store systems to detect and report such abuse.
However, enforcement risk is real: U.S. authorities have filed multiple crypto market manipulation enforcement actions, while ESMA published its dedicated MiCA supervisory guidelines in 2025. Regulatory status, compliance controls and jurisdictional exposure should therefore form part of market-maker due diligence.
| Risk | Potential Issue | What Token Projects Should Check |
| Wash Trading | Artificial volume and misleading market activity | Trading practices and compliance controls |
| Inventory Risk | Excessive token exposure or unfavorable inventory terms | Token rights, loans, options and repayment terms |
| Conflicts of Interest | Provider incentives may diverge from issuer objectives | Compensation structure and trading restrictions |
| Counterparty Risk | Financial or operational failure of the provider | Financial standing, custody and contractual safeguards |
| Poor Liquidity | Wide spreads, weak depth or low uptime | Defined liquidity KPIs and reporting |
| Regulatory Risk | Market-abuse or compliance violations | Licenses, jurisdiction and compliance procedures |
Crypto Market Makers vs. Liquidity Providers
The terms market maker and liquidity provider overlap in crypto and are sometimes used interchangeably. GSR, for example, describes a market maker as a liquidity provider, but the broader category of crypto liquidity providers can also include participants supplying assets to AMM pools or liquidity for institutional execution.
How Market Makers Differ From Liquidity Providers
A market maker typically provides both bid and ask prices, usually through a computerized trading platform, which continuously updates bid and ask prices and sizes. Spreads, depth, and top of book activity are common performance metrics for market makers.
The term “liquidity provider” does not exclusively refer to professional market makers. On decentralized exchanges, liquidity providers are users or institutions who contribute assets into a liquidity pool in return for a share of fees charged on assets traded in the pool.
Market Makers vs. AMMs
Market makers, who quote prices and maintain order books, contrast with automated market makers (AMMs), which rely on smart contracts and liquidity pools to automatically provide prices, rather than supporting trades by matching buyer and seller orders.
However, the distinction is not absolute at the provider level, with professional firms offering both types of service. For example, GSR provides liquidity on both centralized and decentralized exchanges, including DEX market making and arbitrage.
Market Makers vs. OTC Desks
Market making provides liquidity while OTC desks provide negotiated electronic or other off-order book trades. GSR’s current offering of market making is separate from its systematic OTC and high-touch OTC (for larger or more complex block trades) services.
OTC execution is therefore optimal for participants who need to trade in large amounts and do not want their actions to impact the public market, while continuous market making solves issues of daily liquidity and order-book depth.
Which Liquidity Model Is Right for a Token?
The optimal model depends on the token trading mechanism. For order-book markets, professional two-sided quoting tends to be optimal. Liquidity pools for market making are used in AMM DEXs and in DeFi and can be combined with professional on-chain market making and arbitrage services.
When employing a hybrid methodology across multiple venues, prioritizing the project’s target exchanges, depth requirements, trading architecture, and liquidity objectives is essential, as market makers, AMMs, and OTC desks are not interchangeable.
| Liquidity Model | How It Works | Best Suited For |
| Market Maker | Continuously quotes bid and ask prices | CEXs and order-book markets |
| Liquidity Provider | Supplies liquidity through market-making or liquidity pools | CEX and DEX liquidity |
| AMM | Uses smart contracts and liquidity pools for pricing and swaps | DEXs and DeFi protocols |
| OTC Desk | Executes negotiated or quoted trades outside public order books | Large and institutional trades |
| Hybrid Model | Combines order-book, on-chain and OTC liquidity | Tokens trading across multiple venues |
Crypto Market Making Trends in 2026
Institutionalization of Crypto Market Making
Institutional trading is becoming increasingly important for digital-asset markets. According to Wintermute, institutional investors accounted for 72% of the spot flow on its OTC desk in H1 2026, a new record high. Participation in altcoin options is also rapidly growing.
Traditional finance is also establishing a presence in the cryptocurrency market. In July, GSR started providing two-way Bitcoin and Ether liquidity on TP ICAP’s Fusion Digital Assets. It seems that institutional trading infrastructure is becoming aligned with professional crypto liquidity provision.
Regulated Market-Making Services
Such businesses are increasingly obtaining licenses from regulators. As an example, in May 2026, B2C2 was granted MiCA certification in Luxembourg, allowing its EU subsidiary to conduct regulated crypto-asset services across all EU and EEA countries under the passporting process.
Wintermute USA registered to do business with the SEC and became a member of FINRA in August.
Liquidity for Tokenized Real-World Assets
Tokenized RWAs have created an increasingly large market for institutionalized liquidity infrastructure. In April, Chainalysis estimated that tokenized RWAs exceeded $30 billion in value. CoinGecko estimates that its narrowly defined RWAs were worth $19.3 billion in total at the end of Q1 2026.
Yet growth does not guarantee deep secondary markets. A 2026 peer-reviewed study finds great differences in liquidity between tokenized and traded Treasuries, gold and private-credit assets, hinting at the difference between tokenization and real trading capability.
Algorithmic and AI-Driven Market Making
Algorithmic systems already form the technology backbone of market making, adjusting bids and offers in real-time according to price and volume changes.
However, rather than replacing it, AI is extending that model. Recent scholarly research into automated crypto market making with reinforcement learning and broader for 2026 suggests AI-driven trading will lead to faster information processing and better predictive modeling, but new risks in market structure.
The Shift Toward More Transparent Market-Making Agreements
Transparency is increasingly becoming a competitive advantage. Flowdesk now publishes dashboards showing spreads, volumes, depth and market share across venues and strategies in real time so issuers can see how liquidity is faring.
GSR One supports real-time market making analytics, including volume share, order-book depth and other liquidity metrics. These are coupled with other improvements that have assisted in moving issuers away from opaque and bilateral arrangements toward performance against defined KPIs.
What is a crypto market maker?
A market maker places continuous buy and sell orders for a digital-asset pair in order to provide liquidity for the traders, which improves the bid-ask spread and order book depth.
Who are the top crypto market makers?
Major competitors include Wintermute, GSR, Flowdesk, Keyrock, DWF Labs, Auros, Kairon Labs, Amber Group, Cumberland and B2C2. The best provider may depend on market coverage, the liquidity levels needed, regulation, and whether to use an agency or proprietary model.
How do crypto market makers make money?
It may be paid in the form of monthly retainers or token-loan arrangements with call options, or a share of the trading profits.
How much does a crypto market maker cost?
There is no standard price. Commercial terms are established, according to the mandate and model. Retainers involve periodic amounts, while loan-and-option structures typically involve indirect economic costs.
Do crypto tokens need a market maker?
Not every token needs a professional market maker. However, it can improve liquidity, the spread, and order-book depth where organic liquidity is lacking.
Can crypto market makers guarantee a token price?
No. Proper market making adds liquidity to a market, while manipulating the price of a token above or below its market price may contravene market abuse rules.
What is the difference between a market maker and a liquidity provider?
These are generally synonymous terms, since a market maker is a type of liquidity provider, but liquidity provision more generally refers to other mechanisms to provide tradable assets or capital.
Are crypto market makers regulated?
Regulation varies by jurisdiction and activity. In the EU, MiCA regulates crypto-asset services and market abuse, while also imposing duties on crypto actors arranging or executing crypto transactions.
Source: bitcoinfoundation.org