Before signing with a crypto market maker, ask every candidate the same questions about their legal identity, exchange coverage, quoting strategy, KPI commitments, inventory needs, loan and option terms, custody, reporting, compliance with anti-manipulation rules, and termination. Comparable written answers make proposals easy to compare and expose firms that sell volume rather than liquidity.
Key takeaways
- Ask in writing and ask everyone the same questions.
- Look for specific, checkable answers; vagueness is an answer too.
- Pay special attention to custody, option terms, and anti-manipulation commitments.
Identity and track record
- What is your legal entity name and jurisdiction, and who are the directors?
- How long have you been making markets in crypto, and on which venues?
- Have you or your principals been subject to any regulatory action or litigation?
- Can we speak to two projects you work with today, chosen by us from your public client list?
Venues and setup
- Which of our target exchanges do you already trade on via API?
- How long would it take to go live on each?
- Which pairs do you recommend, and why?
- What do you need from us to start (documents, accounts, KYC)?
Strategy and risk
- How do you set and update quotes?
- How do you manage inventory across venues?
- How do you behave in sharp moves or exchange outages?
- What risk limits apply to our token?
KPIs and reporting
- What spread will you commit to per pair, and how is it measured?
- What depth at ±2% (and other bands) per side will you commit to?
- What uptime will you commit to, and what are the exclusions?
- How often will you report, in what format, and from what data?
- Will you provide trade-level data on request?
- What happens if you miss KPIs?
Inventory, loans, and options
- How much token and stablecoin inventory do you need from us, and why?
- If a loan: what term, what strikes, how are strikes calculated, and when can you exercise?
- How will loaned tokens be used, and what limits apply to net selling?
- Where exactly will our tokens be held, and how can we verify balances?
- How and when are unexercised tokens returned?
Compliance and conduct
- Will you commit in writing to no wash trading, self-trading, or price manipulation?
- How do you prevent your own accounts from trading with each other?
- How do you handle exchange surveillance enquiries?
Commercials and exit
- What is the total cost over the term under falling, flat, and rising price scenarios?
- Are there any performance fees or other charges?
- What are the termination rights and notice periods for each side?
- What happens to options and loaned tokens on early termination?
Use the answers with our scoring sheet.
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