Fee Tiers

Fee tiers are the levels in a trading platform's fee schedule that set how much a user pays per trade, with lower rates for heavier users. On a centralized exchange, the tier usually depends on a customer's trading volume over the past 30 days and sometimes on how many of the exchange's own tokens they hold. Each tier typically sets separate rates for the market maker, who adds an order to the book, and for the market taker, who fills an existing order; makers usually pay less, and at the top tiers may receive a rebate. The design rewards professional traders who supply liquidity. On decentralized exchanges the phrase also describes pools with different fixed fee rates, such as Uniswap version 3 pools, where liquidity providers choose a tier suited to the pair's volatility.