3

Sorry if this question is noobish. I thought I had the maker/taker fee mechanism figured out (already existing question at Maker taker fees - can somebody explain in plain english?); apparently I was wrong. Yesterday I put an order to sell LTC at EUR 45 on Kraken, while the market was still at about EUR 44.27. Today my order was filled. However, I was charged the taker fee instead of the maker fee for this transaction.

Why is that the case? I thought for a transaction to be charged the maker fee, the selling order only has to be higher than any of the buying orders that existed at that time? When I put out my order, wasn't it higher than all the buying orders on the market?

Is it because somebody before me already posted a selling order at EUR 45 and I was only adding volume to that already existing selling price, so I was charged the taker fee?

Or is it because when my order was finally filled, the most recent market price actually went above (bypassed) EUR 45, and then went down again?

EDIT: I got the following response from Kraken but I'm still confused:

Without selecting "Post Only Limit," the order will fill at your Limit as either a Maker or Taker order. The Limit is the only condition that was set. Even if you set the order hours ahead of time, other orders can exist on the order book that would predate your own. Especially at round numbers, like 45.00. You could try 44.99, and might have better luck.

I thought that I would only have the taker fee applied if there were already buying orders at the same price, and then I placed a selling order, thus “taking away” the already existing buying order. However, this response seems to imply that the taker fee would also apply if there were previous selling orders at the same price when I placed my order. Does that make sense?

xji
  • 291
  • 2
  • 9

1 Answers1

3

From your comments and edit it sounds like there may be a bug in your exchange's software. That seems entirely plausible for an unregulated industry like Bitcoin trading. (Note that the reason there may be fewer bugs on regulated exchanges is not necessarily the regulation itself but rather the vastly greater number of users affected when things go wrong.) You're smart to be watching your trade receipts so carefully.

When Kraken's (or any other exchange's) systems are working correctly then, by definition:

  • a maker order is one that cannot be immediately filled and therefore sits in the order book for any length of time
  • a taker order is one that can be immediately filled and therefore never enters the order book

Sometimes the market can move so quickly that your order appears to be filled instantly but in fact sat in the order book for a few milliseconds or seconds before being matched. That's still a maker order because for that brief period of time you were "making" liquidity -- you were adding to the list of resting orders that the exchange could advertise to other customers.

On the other hand, if the exchange has poor infrastructure, or if it offers tiered performance levels (which is entirely possible in an unregulated market), you could send an order that does not reach the matching engine until several minutes later. Then it might seem to you (because of the delay) like your order went into the book, when in reality it was executed immediately (upon reaching the matching engine) and therefore "took" liquidity and deserves the taker fee.

dg99
  • 6,056
  • 27
  • 33