Why did Binance freeze the account of the market maker, who earned $38 million on the $MOVE token? I’ve been following this situation closely, and in this post, we’ll break down the reasons behind the exchange's actions and explore alternatives for market making. 🔍
‼️ “One day after MOVE was listed, approximately 66 million MOVE tokens were sold by the Market Maker on 2024-12-10 (UTC), with little buy orders,” says Binance, adding “the Market Maker had an eventual net profit of 38 million USDT before it was offboarded on 2025-03-18.”
🤔 What could have led to such actions?
The market maker’s decision was likely driven by the opportunity to earn significant profits through one-sided market making. But in my opinion, Binance’s MM program rebates aren’t very attractive, with a maximum rebate of just 0.005% for the top participant and 0.002% for the next four. 📉 This could reduce incentives for providing balanced liquidity. ❗
After this situation, I became interested in whether there are better conditions for market makers on other exchanges. 🔍 Let's explore alternatives: what do other exchanges offer for market making?
✅ WhiteBIT provides rebates and discounts based on the maker volume over the past 30 days. On the spot market, the lowest fee rate for makers is -0.012%, while for takers, it is 0.020%. On the futures market, a fee rate of -0.010%, and takers face a fee rate of 0.025%.
✅ Bybit offers a competitive Market Maker program also provides rebates for market makers who help improve the liquidity on the platform. Market makers can receive up to -0.025% rebate on the futures market and additional incentives for providing liquidity on the spot market.
🌍 As the industry continues to evolve, it’s essential for exchanges to adapt their incentive programs to ensure that market makers are motivated to create balanced liquidity. 🚀
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