We used to say that cryptocurrency is a young market with lots of opportunities for its early explorers. And it is indeed, though relatively. Have you ever wondered how many tokens are there already? – more than 12,000! Compared to the previous year, the number of digital coins doubled in 2022. But there is a simple explanation for this astonishing growth.
Thanks to no entry barriers and fueled interest around crypto assets, dozens of them are being launched every day. As the market becomes over competitive, many good projects face liquidity challenges that prevent its mass adoption.
In order to overcome this issue, tokens partner with a crypto market maker – an institutional force that creates an efficient environment for all market players.
The concept of “market makers” is as old as the traditional financial market. They play the role of an intermediary between a buyer and a seller, quoting the orders on both sides to maintain a sustainable infrastructure for investors and traders.
Market makers serve the same purpose in the cryptocurrency market – they are bridging liquidity to various token projects as well as crypto exchanges both centralized and decentralized.
As mentioned earlier, a liquid environment is essential for the survival of any project. Efficient market is naturally more attractive to traders and investors, which is why crypto tokens and exchanges with high liquidity levels are bound to succeed.
No crypto exchange can maintain a fair environment without a market maker. Liquidity is a quality mark for any trading platform – it serves as a green flag for both investors and projects that plan to list on it.
- MM for CEX. An example below perfectly showcases why the need for market making arises on centralized crypto exchanges. A trader places an order on illiquid CEX-> the order takes a lot of time to fill since there is no trading activity-> the order gets miraculously filled with high slippage->the trader has no choice but to go to another crypto exchange. In this case, the promise behind market making includes minimizing bid-ask spreads, keeping up the trading activity, increasing order book depth, and preventing drastic market manipulation.
The more liquidity an exchange has, the greater the number of new token listings on it. A sustainable environment is exactly what token issuers seek for. You have to take liquidity of your exchange seriously if you want it to thrive and grow.
- MM for DEX. Even though market making is commonly considered as an activity for centralized markets there is a job on decentralized platforms that can be exclusively done by specialized trading firms.
Since the liquidity on DEXes is driven by automated market makers, all market making
solutions are tied to the management and creation of liquidity pools. Crypto trading
firms are nurturing liquidity on decentralized exchanges to prevent them from being
manipulated by pumpers and therefore incentivize users to fund pools themselves.
No matter whether the token is listed or just planning to, partnering with a market maker is vital for its efficient performance on a crypto exchange. Having a crypto liquidity provider working for you guarantees:
- 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
The crypto market-making ecosystem is diverse, with many operators in various markets. How do you choose one with deep expertise in clear understanding of the market?
BitQuant Capital is a value-driven market maker and one of the top-ranked crypto trading firms specializing in liquidity provisions for digital assets and exchanges, including CEXs and DEXs.
Since 2019, we have been genuinely pursuing our mission – to be a fair and reliable player helping token & exchange projects from all sizes achieve their liquidity and secondary market trading goals.
Our key competitive advantage derives from our strong quantitative approach, team expertise, and significant investment in groundbreaking technologies.
Bitquant is more than a market maker – it is your ecosystem partner in crime.
- Realistic goals and expectations from both sides – We strive to maintain clear communication and transparency over our actions. We aim to fully comprehend the clients’ requirements so that we can execute properly and in their best interests.
- Competitive pricing – We are bringing your business forward at the most competitive cost on the market. It is in our best interests to ensure our efforts will get the best result for your investment.
- Personal touch – tell us what your needs are and we will come up with the best fitting strategy. Thanks to our agile algorithms, we can actively adapt your trading strategy based on the market conditions, business objectives and growth stage of your venture.
- Deep expertise – In business since 2019, we’ve experienced both successes and failures but learned from them. So far, we have been in charge of 12 successful token launches.
- Reliable partners – We have developed a trading infrastructure which provides liquidity for dozens of trading pairs across top centralized and decentralized exchanges, such as Binance, KuCoin, Bitfinex etc.
One of the biggest challenges for projects operating in crypto space is liquidity and the only way to solve it is to partner with a market maker and liquidity provider.
Market makers are a core component of the digital assets ecosystem, and even highly liquid exchanges and tokens use these services.
The best way to kickstart your market making strategy is to consult with an expert first. Fill the brief form to receive a free consultation from one of Bitquant’s professionals. Or take a look at our website to fully explore our services and solutions.
None of the information on this website is investment or financial advice. CryptoMode is not responsible for any financial losses sustained by acting on information provided on this website.