The cryptocurrencies are a young market with many opportunities for early discoverers. And it really is, albeit relatively. Ever wondered how many tokens already exist? – Over 12,000! Compared to the previous year, the number of digital coins has doubled in 2022. But why is it so?
With no barriers to entry and growing interest in cryptocurrencies, dozens are being published daily. If the market is too competitive, many good projects face liquidity problems that prevent mass adoption.
To solve this problem, tokens collaborate with crypto market makers – they provide liquidity on illiquid markets and for illiquid tokens. Liquidity is an essential element in the financial system, especially in new and emerging industries like crypto.
Who Are Crypto Market Makers?
Market makers are individuals or entities that promote liquidity and accessibility in the cryptocurrency space. They act as intermediaries between buyers and sellers and provide them with instant purchases and sales of digital assets.
Market makers are necessary to keep the market functioning properly. They typically pay a lower commission than market takers and receive rewards for creating liquidity. Without them, markets would become less active and less liquid.
The thing is, the more liquidity there is, the more potential your project has. Low liquidity markets can result in high volatility and wide bid-ask spreads, making it difficult for traders to get a good price or even to fill an order.
Who Needs to Partner with a Crypto Market Maker?
As mentioned earlier, a liquid environment is essential for the survival of any project. The success of cryptocurrencies and exchanges with liquidity is inevitable since an efficient market is inherently more alluring to traders and investors.
Market Making for Crypto Exchanges
No crypto exchange can survive without a market maker. They are responsible for ensuring that the cryptocurrency space is fair and totally in order. Low liquidity exchange is a dealbreaker for both investors and crypto projects that plan on listing on it.
- MM for CEX. Why centralized crypto exchanges need the support of a market maker? Imagine a situation – you placed an order on an illiquid exchange – since your specific market doesn’t have any trading activity going on, your order takes a lot of time to fill – the magic happens – your order gets filled, but with big slippage in price – for obvious reasons you decide to trade on another exchange. The goal of a market maker in this case is to reduce bid-ask spreads, maintain trading activity, develop a deeper order book, and avoid extreme market manipulation.
The more liquidity an exchange has, the more trading activity it has, the more projects come to list on the platform – a win-win for everyone! A highly liquid market will enable people to buy and sell collectibles more easily, which creates a sustainable environment for both token issuers and traders.
- MM for DEX. While still market making is typically thought of as a component of centralized markets, it is possible for specialized trading businesses to provide a fair market on decentralized platforms.
All market making strategies are reliant on the maintenance and development of liquidity pools since automated market makers are the primary source of liquidity on DEXes. To avoid pumper manipulation and encourage customers to fund pools themselves, crypto trading firms are fostering liquidity on decentralized exchanges.
Market Making for Tokens
Collaborating with a market maker is essential for the token’s effective performance on a cryptocurrency exchange, regardless of whether it is now listed or only plans to be. Working with a cryptocurrency liquidity provider ensures:
- Price and trade volume support
- Orderbook management
- Additional profits from arbitrage trading
- Built-in algorithms for liquidity risk management
- Attracting more sophisticated investors to you project
- Pre-launch and after-launch assistance
With several operators in numerous markets, the ecosystem for developing cryptocurrency markets is broad. How exactly do you pick someone who has a thorough awareness of the market and extensive expertise?
Let us introduce ourselves, we are Bitquant!
One of the top-ranked cryptocurrency trading companies, BitQuant Capital is a value-driven market maker with a focus on providing liquidity for digital assets and exchanges, both CEXs and DEXs.
We have been genuinely working toward achieving our aim since 2019, which is to be a fair and trustworthy player who aids token and exchange projects of all sizes in meeting their liquidity and secondary market trading objectives.
Our solid quantitative approach, team knowledge, and major investment in ground-breaking technology are the drivers of our key competitive advantage.
What sets Bitquant apart from others?
Bitquant is your ecosystem partner in crime, not just a market maker.
- Realistic objectives and expectations on both sides – We make an effort to keep lines of communication open and our activities transparent. To appropriately execute in the clients’ best interests, we strive to completely understand their requirements first.
- Competitive pricing – We are assisting in bringing your project to the next level at the most affordable price possible. Assuring that our efforts will provide the best return on your investment is in our best interests.
- Personal touch – let us know what you need, and we’ll suggest the best approach to take. Our flexible algorithms enable us to actively modify your trading strategy in response to changes in market dynamics, corporate goals, and stage of development.
- Expertise – having been in the company since 2019, we have deep expertise and have benefited from both our achievements and failures. We have handled the successful launch of 12 tokens up to this point.
- Partners you can trust – we have built a trading infrastructure that offers liquidity for a wide range of trading pairs on the most popular controlled and decentralized exchanges, including Binance, KuCoin, Bitfinex, etc.
Liquidity is one of the major problems facing companies in the crypto world, and the only way to overcome it is to collaborate with a market maker and liquidity provider.
Market makers are a crucial part of the ecosystem for digital assets, and they are even used by extremely liquid exchanges and tokens.