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DeFi - Decentralized Finance·/u/SadExtreme8597·3 days ago
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Most people think a market maker just "adds liquidity." That's like saying a surgeon "does the operation." Technically true, completely useless as a description. Here's what's actually happening. A serious MM runs 150+ open orders on each exchange simultaneously. At any given moment there are 12 to 14 algorithms active per client, each doing a specific job. Spread management. The gap between the best buy and best sell order needs to stay tight at all times. If the spread on your token is above 1% - that's already a problem. Algorithms keep this in check around the clock. Order book depth. Depth gets maintained at multiple price levels: 0.3%, 0.5%, 1%, 2%, 5%, 10%, 20%. Not just the shallow range that shows up on CoinGecko. Real depth that holds when actual volume hits. Cross-exchange arbitrage. If your token trades on six exchanges, the price needs to stay consistent across all of them. Discrepancies get exploited fast. Algorithms balance this constantly.…

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