Quick answer

The bid-ask spread in crypto is the gap between the highest price a buyer will pay (the bid) and the lowest price a seller will accept (the ask) for your token. As a percentage, it is (ask minus bid) divided by the mid price, times 100, where the mid price is the average of bid and ask. A wide bid ask spread makes every trade more expensive, so traders go elsewhere, and exchanges read it as a sign that the market for your token is thin.

What is the bid-ask spread in crypto

Every token pair on a centralized exchange has an order book. On one side sit buy orders (bids), on the other sit sell orders (asks). The best bid is the highest open buy order, and the best ask is the lowest open sell order. The distance between those two prices is the bid-ask spread.

For a founder, the spread is the most visible number describing how easy it is to trade your token. A trader who buys at the ask and immediately sells at the bid loses the spread. That loss is a hidden cost of trading your token, paid on top of any exchange fees. When the cost is low, active traders and arbitrageurs participate more. When it is high, they trade less or skip the pair entirely.

How to calculate bid-ask spread percentage

The bid ask spread percentage formula is simple. First find the mid price, which is the best bid plus the best ask, divided by two. Then take the ask minus the bid, divide that difference by the mid price, and multiply by 100. The result is the spread as a percentage of the token's price, which lets you compare tokens and venues with very different price levels.

Illustrative example (hypothetical numbers, not real market data). Suppose your token has a best bid of 0.0990 USDT and a best ask of 0.1010 USDT. The mid price is (0.0990 plus 0.1010) divided by 2, which equals 0.1000 USDT. The absolute spread is 0.1010 minus 0.0990, which equals 0.0020 USDT. Divide 0.0020 by 0.1000 and you get 0.02, and multiplying by 100 gives a spread of 2 percent.

What is a good bid-ask spread for a token

There is no single number that answers what is a good bid ask spread for every token. A large, heavily traded asset on a major venue will naturally trade with a tighter spread than a newly listed small cap token on a mid tier exchange. The right target depends on your liquidity, the venue, your market cap, and the specific pair (a USDT pair and a BTC pair for the same token can behave very differently).

Instead of chasing a figure from a forum post, take your target from two written sources. The first is your exchange's listing terms or liquidity requirements, if the venue provides them in writing. The second is the service level agreement (SLA) with your market maker, which should state a target spread per venue and per pair. If neither document gives you a number, ask for one in writing before you agree to anything.

Why spreads get wide

A wide bid ask spread is a symptom. The cause is usually one of a few structural issues in how liquidity is supplied to the order book.

Thin order book depth

If there are only small orders near the best bid and ask, a single trade can consume them and push the best price further away. The spread widens until someone refills the book. Thin depth is the most common reason small tokens show wide spreads.

Few active orders

Spreads stay tight when many participants keep updating quotes. When only a handful of orders sit in the book, and they are rarely refreshed, gaps appear and stay open. This often happens after an initial listing period when organic interest cools.

Volatility

When prices move quickly, liquidity providers widen their quotes to protect themselves from being filled at stale prices. Some step back completely for a while. Wider spreads during sharp moves are normal, but they should tighten again as markets settle.

Uneven liquidity across exchanges

Many tokens trade on several venues. If liquidity is concentrated on one exchange and neglected on others, the secondary venues can show much wider spreads. Traders on those venues pay more, and the exchange sees a weaker market for your pair even if your main venue looks fine.

How spread connects to order book depth and exchange monitoring

Spread and depth are two sides of the same picture. The spread tells you the cost of the smallest trade. Depth tells you how much size the book can absorb before the price moves meaningfully. A token can show a tight spread with almost nothing behind it, which means any real order will still move the price.

That is why exchanges commonly look at both together. A widely used depth measure is the total value of orders resting within plus or minus 2 percent of the mid price. Venues track metrics like these as part of routine market quality monitoring, to understand whether a pair is serviceable for their users.

Track your spread and depth within 2 percent of mid on every pair. If a pair has drifted, there are structured ways of restoring liquidity on an exchange pair.

How market makers keep spreads tight

A professional market maker's core job is to keep a fair, continuous market in your token. Three practices do most of the work.

Continuous two-sided quotes

The market maker keeps both buy and sell orders in the book at all times, close to the mid price, and refreshes them as the market moves. Because there is always a competitive bid and ask, the spread stays narrow and traders can enter or exit without paying a large hidden cost.

Inventory management

Quoting both sides means the market maker accumulates tokens or stablecoins as trades happen. Good inventory management keeps that position balanced, so quotes can stay tight instead of being pulled when inventory runs low on one side. This is also why it matters who provides the inventory and on what terms.

Transparent spread and depth reports

Tight spreads should be verifiable. A reliable partner sends regular reports showing spread and depth per venue and per pair, measured over defined windows, so your team can confirm the service is delivered. Reports turn market making from a promise into something you can audit. You can see how this works in practice on our page about crypto market making services.

What to ask a market maker about spreads

Before you sign, get clear written answers to a few questions. They prevent most misunderstandings later.

What is the target spread in the SLA? Ask for a specific target per venue and per pair, written into the agreement, rather than a general statement that spreads will be kept tight.

How is the spread measured? Ask which formula is used (mid price or another base), over what time window, how often samples are taken, which timezone the daily figures use, and exactly which pairs are covered.

How often will we get reports? Agree on reporting frequency, whether daily, weekly or monthly, and on the format. Ask whether you get raw data or only summaries, and whether depth within 2 percent of mid is included alongside spread.

What happens during volatility? Ask how quotes behave in sharp market moves, whether the SLA allows temporary widening, and how quickly spreads are expected to return to target afterward.

What exactly am I paying for? Ask for clarity on the retainer versus the inventory arrangement. Who supplies the tokens and stablecoins used for quoting, under what terms, and what happens to that inventory when the engagement ends. A clear retainer structure makes costs predictable and easy to compare.

Conclusion

The bid-ask spread is one of the simplest and most important signals of how tradable your token is. Measure it with a consistent formula, look at it together with depth, set your target from written venue terms and your SLA, and insist on reports that let you verify it over time. If you want a partner that works on a clear retainer and reports spread and depth transparently, EasyMM is happy to walk your team through how we would approach your pairs.

FAQ

Short answers to common founder questions.

What is the bid-ask spread in crypto?

It is the difference between the highest open buy order and the lowest open sell order for a token on an exchange. It represents the hidden cost a trader pays to buy and sell immediately. Tighter spreads usually mean a more liquid, more tradable market.

How do I calculate bid-ask spread percentage?

Subtract the best bid from the best ask, divide the result by the mid price, and multiply by 100. The mid price is the best bid plus the best ask, divided by two. This gives a percentage you can compare across tokens and venues.

What is a good bid-ask spread for my token?

It depends on your liquidity, venue, market cap and trading pair, so there is no universal number. Take your target from your exchange's written terms and your market maker's SLA. Then judge success by how consistently the spread stays near that target over time.

Why is my token's bid-ask spread so wide?

The usual causes are thin order book depth, few active orders, high volatility, or liquidity concentrated on one exchange while others are neglected. Each cause has a different fix. Looking at spread and depth per venue usually shows which one applies.

Is a tight spread enough on its own?

No. A tight spread with very little depth behind it still lets small orders move the price. Track spread together with depth within 2 percent of the mid price for a realistic picture.

How can I verify my market maker is keeping spreads tight?

Ask for regular reports showing spread and depth per venue and pair, with the measurement method clearly stated. Compare those reports with what you see on the exchange yourself. Consistent, documented numbers are the best evidence the service is working.