First of all, when it comes to the capital market which already plays an important role in fundraising We always look to have “Secondary market” that allows investors to trade on the exchange of securities. noWhether it is equities (common stocks), debt instruments (debentures), various investment units, as well as digital assets that are popular today. There is a secondary market called “Digital Asset Exchange” where cryptocurrency exchanges are traded. or digital tokens
The main objective of the secondary market is to allow holders of securities or digital assets to be traded according to the needs of investors/traders. Having “liquidity” is therefore an important mechanism to help investors have Trust that securities or digital assets can be bought or sold when needed.
and if such securities or digital assets do not have liquidity Market Maker Therefore, it is important to maintain liquidity for securities and digital assets. by setting the buy price (bid) and setting the selling price (offer) according to the market mechanism so that the prices that occur in the market truly reflect the needs of investors
In doing the job Market Maker will be paid or benefits from performing duties such as reducing commissions from the stock exchange or trading center They may also benefit from the price difference from the transaction.
Market Maker can enhance liquidity, but do not wash trading
In order to carry out Market Maker’s orders, it must not have an impact on the market as a whole. or take advantage of investors And it’s important that it doesn’t violate the law.
whoin the case of trading in securities or digital assets in many markets And the trading price is very different. Market Maker’s liquidity custody mechanism will keep the price of a security or digital asset at a price that is similar to what is traded in other markets. through the arbitrage* process
By buying securities or digital assets in the market at a lower price (cheap) and selling it in the market at a higher (expensive) price and at some point the difference in price and the opportunity to profit from arbitrage disappears.
The Market Maker will set a price to support trading with investors. but will not go into trading and matching with each other to make the price go to a certain point in a price pointing manner and make people misunderstand both in terms of price and trading volume which is an overreaction Take advantage of other investors may be in violation of the law
in addition A Market Maker that creates artificial volumes by matching each other (Wash Trade), which is done by the purchase and sale transactions that occur. Ownership has not been changed. made by the same person to deceive investors that securities or digital assets There are many investors trading, the market is bustling.
But in fact, the bulk of the trading volume is owned by the Market Maker itself, not the actual trading volume generated by the investors. Such actions are misleading to investors/traders. that there is more trading volume than it actually is Not in accordance with the real market mechanism.
This act is an offense under the Securities and Exchange Act B.E. 2535 and the Royal Decree on Doing Digital Asset Business B.E. 2561
so Market Maker Therefore, it is an important person who helps to ensure that securities or digital assets are of interest to investors. and make investors benefit But the market maker’s function must be under the law that the Market Maker takes care of liquidity. Therefore, it will help to take care of the secondary market to be transparent and reliable for both domestic and foreign investors.
Note: arbitrage is the profit from the difference in price of the same product that is traded in different markets.
