Makers and Takers
By KalshiThe difference between market makers and market takers.
Key Terms
Resting Order: An offer to purchase contracts at a certain price that is not immediately matched.
- Market Maker: An individual who places resting orders.
- Market Taker: An individual who trades with resting orders.
- Liquidity: A measure of how much order supply is available in a market.
- Order book: A tool that informs traders of the current resting orders placed in a market, organized by price.
Summary
Every trade on Kalshi is a match made between a market maker and a market taker.
- All resting orders placed by market makers can be accessed by navigating to the order book.
- There are unique benefits to being a market maker or a market taker.
Liquidity
Liquidity is a measure for how easy it is to trade in a market. When liquidity is high, it's easy to quickly buy or sell large volumes of contracts at competitive prices.
Liquidity on Kalshi is created by market makers and removed by market takers. Market makers place resting orders, which are offers to purchase a set quantity of contracts at a certain price. This provides liquidity in a market. Market takers are able to see the available resting orders and trade with them.
The order book
The order book displays all the resting orders available on a market. It displays the quantity of resting orders available as well as their corresponding prices. The order book can be toggled to show different views.
- The order book can be toggled to display resting orders in terms of bids, the maximum price a buyer is willing to pay for that contract, or asks, the minimum price that a member is willing to sell that contract for.
- The order book can be toggled to show all prices from $0.01 to $0.99 or just the prices that have resting orders available.
Example: In this event contract below, the order book displays all the resting orders and their corresponding price. As the order book shows, there are 524 contracts available on the No side for $0.62 each and 566 contracts available on the Yes side for $0.43 each.

Benefits of being a market maker
Market makers are able to trade event contracts without paying any fees. Kalshi exempts resting orders from fees to encourage market making and boost liquidity.
Makers are also able to lock in guaranteed profits by placing resting orders on both sides of a contract. If a market maker places limit orders on both sides of a contract and there is demand on both sides, they will end up buying both the Yes and No sides for prices that total less than a dollar. This will yield a sure payout when the contract expires.
Benefits of being a market taker
Market takers are able to place trades immediately. Unlike market makers, takers do not have to wait for other members to match their position on the order book, since they are the ones doing the matching. This is beneficial when you have strong convictions about certain events and want to trade on them quickly.
Market takers also do not need to worry about placing resting orders at competitive prices. Takers are able to browse the resting orders available and trade with those that are priced the lowest.
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