Crypto Market Maker Deals

The Retainer Model

Under a retainer the issuer lends the desk both the token and the quote currency, pays a monthly fee, and has a say in venues and liquidity targets. The loan comes back at the end of the term. As one desk's own comparison puts it, the issuer assumes the risk of capital here.

What the issuer is buying is presence. Tight spreads, quoted size, uptime on named pairs. The desk is paid to show up, not to push the price anywhere in particular, which makes it the less exciting of the two arrangements and probably the more honest one.

The Loan and Call Option Model

The alternative costs the issuer no cash at all, which is exactly why young projects like it. The issuer lends the desk a slice of supply and grants call options struck above the price on the loan date. The desk brings its own buy side capital and quotes for a year or two. At expiry it either exercises the calls, buying the borrowed tokens at the strike, or hands them back.

Look closely at that payoff. The desk wins if the token finishes above the strike. Founders often read this as beautiful alignment, and in a narrow sense it is, but it is alignment with the price on one specific future date rather than with orderly trading in the two years leading up to it. The exposure can also be hedged somewhere else entirely, which rather takes the romance out of it.

Where the Line Actually Sits

None of this is manipulation, and conflating the two is the most common mistake made about this subject. Being paid in options is a contract structure. Inventing activity is a different thing altogether.

In October 2024 the Securities and Exchange Commission charged three firms it said purported to be market makers, alleging self trading, commonly called wash trading, and other practices serving no economic purpose, with bots producing what the regulator described as billions of dollars of artificial volume. That case was about manufactured volume, not about how a desk gets paid.

The practical rule: when a brand new listing trades with suspiciously tidy depth, the explanation is usually a contract rather than a sudden outbreak of public enthusiasm. Ask whether a project discloses having a market maker and on which structure. The specific numbers that circulate for fees, borrowed supply and strike premiums come from secondary sources rather than contracts, so treat them as gossip. And treat any promise of a guaranteed price as precisely the confession it is.