Market-Making Services

Definition ∞ Market-making services involve providing liquidity to financial markets by continuously quoting both buy and sell prices for an asset. Market makers profit from the bid-ask spread and help ensure that traders can execute orders efficiently without significant price impact. In the digital asset sector, these services are crucial for centralized exchanges and decentralized protocols (via automated market makers). They contribute to a liquid and orderly trading environment.
Context ∞ Crypto news often discusses the significance of market-making services for the liquidity and price discovery of digital assets, especially for newer or less liquid tokens. The role of professional market makers and the mechanisms of automated market makers (AMMs) in decentralized finance are frequently analyzed. Regulatory bodies are increasingly scrutinizing these services to ensure fair practices and prevent market manipulation.