Market Making 101
Good reading by Forgd
https://app.forgd.com/academy/lessons/market-making/why-do-i-need-to-work-with-a-professional-market-maker
Good reading by Forgd
https://app.forgd.com/academy/lessons/market-making/why-do-i-need-to-work-with-a-professional-market-maker
Unlike TradFi (exchanges have their own MMs), crypto projects must engage MMs directly to provide liq, leading to upfront compensation requirements
Compensation = evolved from retainers to options-based structures where MMs receive rights to buy tokens at predetermined prices, with allocation sizes becoming more efficient over time
VIP tier status on exchanges is crucial for MM profitability, as only those with favorable fee structures can operate effectively in markets with tight spreads
Multi-exchange listings are preferred by market makers as they enable effective hedging strategies to manage risk exposure while maintaining liquidity obligations
Source: https://x.com/velvetmilkman/status/1912639322198524223?s=12&t=2q9OLMlaobNlHLewOXT4uA
Compensation = evolved from retainers to options-based structures where MMs receive rights to buy tokens at predetermined prices, with allocation sizes becoming more efficient over time
VIP tier status on exchanges is crucial for MM profitability, as only those with favorable fee structures can operate effectively in markets with tight spreads
Multi-exchange listings are preferred by market makers as they enable effective hedging strategies to manage risk exposure while maintaining liquidity obligations
Source: https://x.com/velvetmilkman/status/1912639322198524223?s=12&t=2q9OLMlaobNlHLewOXT4uA
Bitwise Q1 2025 Crypto Market Review
Despite positive regulatory developments (Trump's pro-crypto executive orders, SEC lawsuit dismissals, SBR), crypto prices fell significantly in Q1 2025
Stablecoins reached an all-time high of $218 billion (up 13.5% QoQ), tokenized real-world assets grew 37% QoQ, and bitcoin futures trading volume hit record highs
Insti adoption is accelerating, with major financial institutions like BlackRock, Goldman Sachs, and JPM expanding crypto offerings across trading, custody, ETPs, payments, and tokenization services
https://s3.us-east-1.amazonaws.com/static.bitwiseinvestments.com/Research/Bitwise-Crypto-Market-Review-Q1-2025.pdf
Despite positive regulatory developments (Trump's pro-crypto executive orders, SEC lawsuit dismissals, SBR), crypto prices fell significantly in Q1 2025
Stablecoins reached an all-time high of $218 billion (up 13.5% QoQ), tokenized real-world assets grew 37% QoQ, and bitcoin futures trading volume hit record highs
Insti adoption is accelerating, with major financial institutions like BlackRock, Goldman Sachs, and JPM expanding crypto offerings across trading, custody, ETPs, payments, and tokenization services
https://s3.us-east-1.amazonaws.com/static.bitwiseinvestments.com/Research/Bitwise-Crypto-Market-Review-Q1-2025.pdf