Market Order

What is a Market Order?

A market order is an instruction to buy or sell immediately at the current best available price. You’re guaranteed to execute, but the exact price may vary based on available liquidity.

How Market Orders Work

Buying

1. You submit market buy order
2. Order matches with lowest ask prices
3. Fills immediately at available prices
4. You receive crypto at market price

Selling

1. You submit market sell order
2. Order matches with highest bid prices
3. Fills immediately at available prices
4. You receive USDT/fiat at market price

Market Order Example

Order Book

Asks (Sell)	Bids (Buy)
$70,050 (1 BTC)	$69,950 (2 BTC)
$70,025 (0.5 BTC)	$69,925 (1 BTC)
$70,010 (0.3 BTC)	$69,900 (3 BTC)

Market Buy 1.5 BTC

Fills at:

• 0.3 BTC @ $70,010
• 0.5 BTC @ $70,025
• 0.7 BTC @ $70,050 Average price: ~$70,033

Market vs Limit Orders

Feature	Market Order	Limit Order
Execution	Guaranteed	Not guaranteed
Price	Market price	Your specified price
Speed	Immediate	May take time
Slippage	Possible	None
Fees	Taker fee	Often maker fee

When to Use Market Orders

Good Scenarios

• Speed is critical
• Highly liquid markets
• Small order sizes
• News/event trading
• Stopping out of losing positions

Poor Scenarios

• Large orders (relative to liquidity)
• Illiquid markets
• When price matters more than speed
• Can wait for better price

Market Order Costs

Trading Fees

Market orders always pay taker fees:

• Binance: 0.10%
• Coinbase: 0.40-0.60%
• Kraken: 0.26%

Higher than maker fees for limit orders.

Slippage Costs

• Additional hidden cost
• Worse execution price
• Increases with order size
• Increases with low liquidity

Slippage in Market Orders

What Causes It

• Not enough liquidity at best price
• Order fills across multiple price levels
• Fast-moving markets

Minimizing Slippage

• Trade liquid pairs
• Use smaller orders
• Trade during active hours
• Consider limit orders instead

Market Orders on Different Platforms

Binance

• Simple market order interface
• Shows estimated price
• Taker fee: 0.10%

Coinbase

• Default order type for beginners
• “Buy/Sell” is market order
• Higher fees on simple interface

Kraken

• Market orders available
• Shows order book depth
• Good for quick execution

Market Order Risks

Price Risk

• Price may change between click and fill
• No control over execution price
• Large orders may fill at poor prices

Flash Crash Risk

• During volatility, spreads widen
• Market orders fill at any price
• Can result in very poor execution

Fat Finger Risk

• Wrong quantity mistakes
• No confirmation at specific price
• Can be costly errors

Market Order Tips

Best Practices

1. Check current spread before ordering
2. Verify order size carefully
3. Use for time-sensitive trades only
4. Consider order book depth

Avoid These Mistakes

1. Market orders in illiquid pairs
2. Large market orders
3. Market orders during extreme volatility
4. Market orders for non-urgent trades

Alternative Approaches

If You Have Time

Use limit orders:

• Better price execution
• Lower fees (maker)
• More control

For Large Orders

Split into smaller pieces:

• Reduces market impact
• Better average price
• Less slippage

If Speed AND Price Matter

• Market order with limit (some platforms)
• Sets maximum acceptable price
• Fills what it can at acceptable levels

Market Order in Futures

Same concept but with derivatives:

• Open/close positions immediately
• Subject to same slippage concerns
• Critical for stop-loss execution
• Available on Bybit, OKX