Why Do Crypto Trades Need Market Makers? An In-Depth Analysis of Top Market Participants in 2025

Cryptocurrency markets operate 24/7 without interruption, but imagine what would happen without market makers—you’d find no sellers when you want to buy Bitcoin, no buyers when you want to sell, leading to extreme price volatility and high costs. That’s the core value of market makers: they act as the “lubricant” of the market, continuously quoting bid and ask prices to create a stable, efficient trading environment for traders.

What exactly do market makers do?

Market makers are specialized trading institutions or algorithmic trading systems. Their working model is simple but highly effective: they place both buy and sell orders simultaneously. For example, they might place a buy order for Bitcoin at $100,000 and a sell order at $100,010; the $10 spread is their profit source.

Unlike ordinary traders, market makers aim not to buy low and sell high for big profits, but to accumulate gains from tiny price differences per trade. When this process repeats over thousands of trades, it results in a stable income stream. They utilize high-frequency trading algorithms, deep liquidity management, and multi-market hedging strategies to quickly adapt to market changes and minimize risk.

How do market makers improve trading experience?

Direct reflection of liquidity depth

In markets without sufficient market makers, a large buy order can cause prices to spike. With market makers, traders can execute trades quickly at prices close to the market rate, whether they are retail investors or large institutions. By February 2025, top market makers manage assets and trading volumes that are truly impressive—these directly translate into greater stability and lower costs for traders.

Price discovery and market signals

Market makers continuously adjust their quotes to help the market find the true consensus price. Their algorithms analyze order book depth, volatility, and trade flow in real-time, dynamically optimizing bid-ask spreads. This process not only stabilizes prices but also makes market signals clearer.

24/7 availability

Crypto markets never close, and market makers never rest. This ensures that even during periods of low liquidity, traders can complete transactions at reasonable prices. This is especially important for new token launches—projects that introduce professional market makers to provide initial liquidity can attract enough traders to participate.

How do exchanges benefit from market makers?

• Explosive trading volume: Ample liquidity attracts more traders, increasing trading volume and directly boosting fee revenue.
• Enhanced user experience: Fast execution, low slippage, and stable prices are key to attracting and retaining users.
• Support for new tokens: Collaborating with market makers allows exchanges to provide immediate liquidity for newly launched tokens.
• Market competitiveness: Trading pairs supported by quality market makers tend to be more active in competitive exchange environments.

Top-tier crypto market maker ecosystem (2025 overview)

Wintermute: Leader in algorithmic trading

As one of the most well-known market makers in the industry, Wintermute operates across over 50 crypto exchanges globally, covering more than 300 assets on 30+ blockchains. As of February 2025, they manage approximately $237 million in assets. Their cumulative trading volume has reached around $6 trillion (as of November 2024), demonstrating their significant market influence.

Advantages: Comprehensive coverage of CEX and DEX, advanced algorithms, strong industry reputation
Disadvantages: Intense competition, less focus on small-cap tokens, not ideal for very early-stage projects

GSR: Institutional-grade liquidity provider

With over ten years of industry experience, GSR offers not only market making but also OTC trading, derivatives, and full financial services. By February 2025, they have invested in over 100 leading industry projects and protocols, providing liquidity on more than 60 exchanges.

Advantages: Deep liquidity coverage, extensive industry experience, full support for token issuance
Disadvantages: Focused mainly on large projects and institutional clients, higher costs for small projects, premium service fees

( Amber Group: AI-driven trading brain

Managing $150 million in trading capital, serving over 2,000 institutional clients. Their trading volume exceeds $1 trillion (as of February 2025), with a strong emphasis on compliance and AI-driven risk control.

Advantages: AI and data-driven, comprehensive financial services, top-tier risk management
Disadvantages: High entry barriers, multiple business lines may dilute focus, less suitable for small projects

) Keyrock: Precise data-driven market making

Founded in 2017, Keyrock executes 550,000 orders daily, covering over 1,300 trading pairs across 85 exchanges. They offer market making, OTC, options, treasury management, and more.

Advantages: Precise algorithm optimization, customizable solutions, data-driven liquidity configuration
Disadvantages: Smaller scale, less well-known than top-tier players, custom services may be costly

DWF Labs: Dual identity in Web3 sector

Both an investor and a market maker, managing a portfolio of over 700 projects, supporting more than 20% of projects in CoinMarketCap’s Top 100 and over 35% in Top 1000. They provide liquidity on more than 60 top-tier exchanges, covering spot and derivatives markets.

Advantages: Combining market making and investment, covering early-stage project ecosystems, strong OTC trading solutions
Disadvantages: Only collaborates with Tier 1 projects, strict project vetting processes

Market makers vs. market participants: Who provides liquidity, who consumes it?

There are two core types of participants in the market:

Market Makers (Liquidity Providers)

• Place limit orders, wait for execution
• Not eager to trade immediately
• Earn stable profits from spreads
• Bear inventory risk

Market Participants (Liquidity Consumers)

• Trade at market price immediately
• Need quick entry or exit
• Transaction costs are liquidity costs
• Benefit from the trading convenience provided by market makers

They complement each other: market makers’ quotes create trading opportunities, and traders’ volume ensures that these quotes are continuously executed. A healthy market is the result of a balance between these two forces.

Challenges faced by market makers

Although essential, market makers face tough conditions:

Market volatility as a double-edged sword Sharp price swings can quickly wipe out profits. Rapid market movements may leave them unable to adjust quotes in time, resulting in losses.

Inventory management difficulties Market makers must hold large amounts of crypto assets to ensure liquidity. If asset prices plummet, unrealized losses can be heavy—especially in small-cap markets with higher volatility.

Technical and system pressures High-frequency trading systems must operate flawlessly. Any delays, failures, or attacks can lead to incorrect quotes or failed executions, causing direct losses.

Regulatory uncertainties Different jurisdictions have varying definitions and regulations for market making. Some may view it as market manipulation and ban it, while others encourage it. Global market makers must navigate complex compliance requirements across multiple jurisdictions, incurring significant costs.

Summary: Why are market makers important?

The health of the crypto trading market largely depends on the presence of high-quality market makers. They ensure liquidity, stabilize prices, reduce trading costs, and accelerate price discovery—hallmarks of a mature market.

While market makers face their own risks, technical challenges, and regulatory pressures, their importance is undeniable. As the crypto market continues to evolve and mature, top-tier market makers will play an increasingly vital role in shaping more transparent, efficient, and accessible digital asset markets. Understanding how market makers operate is essential for anyone seeking a deeper grasp of the crypto trading ecosystem.