Market Maker Program
Trade8 runs a market maker program that lets anyone participate to quote bid and ask quotes to our traders. The program is competitive, meaning market makers compete to offer the best quotes, and only the best quotes are shown to traders on the dashboard to execute against. This enhances spreads for our traders while incentivizing market makers to offer high quality quotes.
Market makers are manually vetted by our team. As a market maker, you are responsible for sourcing real-time price feeds and automating your quotes. You get a priority, high speed connection to our servers to ensure low latency. There are certain obligations you must meet as a market maker, including having experience in making markets and knowledge of algorithmic trading. Read the FAQ below to learn more.
Do I need to KYC? Yes, just like anyone who wishes to use Trade8 services, you will need to go through a KYC/AML check to become a market maker.
How many market makers are there? There are currently 9 market makers competing for quote execution on Trade8.
Do I need to deposit to become a market maker? There is no obligation to deposit to become a market maker. You can simply start quoting prices to traders.
To get you started, we will credit your account with a non-withdrawable 0.5 BTC balance. This helps mitigate any small early losses in your market making activity. However, if your account balance falls below 0, you will need to deposit to keep your account active. Also, if your trades start resulting in too many losses, you may be suspended or asked to revise your quoting strategy.
How do I run my quoting algorithm? When you are accepted into the Market Maker Program, you'll be able to access a dashboard to see your performance, download statements, and connect to our API to provide quotes. You have the option to run your quoting algorithm on your own system or we can provide a co-located VPS.
What are the fees? Trade8 retains 40% of your market making gross profit. You are responsible for covering any and all losses.
What happens if I make losses? If you make losses beyond your account balance, you must deposit to cover those losses. You must also improve your quoting strategy to prevent your account from being suspended. If you are unable to deposit to fully cover your losses, your future profits will be affected, meaning profits you make will not reflect on your account until total losses are fully covered.
Do you allow swaps / exchanges into stable collateral?
Yes! We understand that you want to preserve collateral value, especially during bear markets, without needing to withdraw and interrupting your market making strategies. We offer market makers a swap service into stablecoins or any other (liquid) ERC20 token on the Ethereum blockchain. Our trading desk will execute your swap at the best available price and credit the proceeds to your account, minus a 0.45% fee. Stable collaterals can be withdrawn at any time.
As a participant in Trade8’s Market Maker Program, you agree to be bound by these rules which apply to all members of the program. You shall satisfy that you have the technical capabilities to act as a Market Maker, that is to provide real-time bid and ask quotes at which you are willing to buy or sell, or hold long or short positions, for a duration of up to 60 days on Trade8’s listed products or a subset of those products. You agree to maintain an electronic connection to Trade8’s markets and trading engine and have appropriate systems, procedures, and risk controls in place to minimize erroneous quotes or position entries and exits. You must maintain records of your market making activity for at least five years, and Trade8 will maintain these records for a period of up to 10 years. Trade8 reserves the right to disclose such records to a competent authority in appropriate cases.
As a member Trade8’s Market Maker Program, you agree to these terms. You agree to pay all relevant platform fees which are outlined as follows. 40% of the gross positive results you generate through market making is retained by Trade8. You bear the entire risk for losses, e.g. negative activity. A gross negative result period will impact performance of your next available gross positive period as the negative result will be subtracted from your gross positive result until your total net result returns above zero (“high watermark”). Only results credited to your balance are available for withdrawal. Trade8 locks net positive results ("net profits") above a specific threshold (10 BTC) for 18-36 months after your first trade is placed as a market maker. This lets Trade8 address platform risk and anticipate large counter party trades without risk of default. After the 18-36 months are up, any positive net results remaining are made available to your balance for withdrawal. We highly recommend that you maintain a balance on Trade8 of at least 10% of your trailing 12-month net profit. This is a flexible policy, however account balances that fall below this threshold will be at risk of suspension.
You are solely responsible and liable for any and all trading and market-making activity for your account on the Website; and, for knowing the true status of any position. Market making is not risk free. In periods of heavy trader gains, your market making results will decrease or turn negative. You are solely responsible for these risks.