> For the complete documentation index, see [llms.txt](https://altodex.gitbook.io/docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://altodex.gitbook.io/docs/core-mechanics/2.3-spot-mechanics.md).

# 2.3 Spot Mechanics

<figure><img src="/files/QQpKjKPBIzShglDMlvyt" alt=""><figcaption></figcaption></figure>

#### What Is Spot Trading?

Spot trading is the direct exchange of one asset for another at the spot price, which is the current market rate.

Trading on the spot market involves purchasing or disposing of real tokens, not contracts or derivatives.

**For example:**

You can buy one Bitcoin for 100,000 USDC or sell one Bitcoin for 100,000 USDC if the BTC/USDC pair is trading at $100,000.

The asset you purchase is entirely yours, and its value fluctuates in tandem with the market.

***

### How Spot Trading Differs From Perpetual Trading

| Feature              | Spot Trading                                  | Perpetual Trading                                                      |
| -------------------- | --------------------------------------------- | ---------------------------------------------------------------------- |
| **Ownership**        | Traders buy and hold the actual tokens.       | Traders hold *contracts* tracking price changes, not the asset itself. |
| **Leverage**         | No leverage — you trade only what you own.    | Leverage available — trade larger positions using collateral.          |
| **Settlement**       | Immediate; assets are transferred upon trade. | No expiry; contracts remain open until closed or liquidated.           |
| **Profit Direction** | Profit only when price increases.             | Profit from both rising (*long*) or falling (*short*) prices.          |

To put it briefly, perpetuals are for directional exposure, whereas spot trading is for ownership.

***

#### Trading Fees on Alto Spot

In order to reward liquidity providers and guarantee effective price discovery, Alto employs a transparent maker-taker fee model.

* **Maker Fee:** `0.004%`\
  Makers add liquidity by placing orders in the book that wait to be filled.\
  **Example:** Buying 0.1 BTC at $100,000 →\
  `100,000 × 0.1 × 0.004% = 0.4 USDC` fee.
* **Taker Fee:** `0.03%`\
  Takers remove liquidity by executing instantly against existing orders.\
  **Example:** Buying 0.1 BTC at $100,000 →\
  `100,000 × 0.1 × 0.03% = 3 USDC` fee.

> 💡 For the latest list of trading pairs and fees, check our **Spot Trading Page**.

***

### Maker vs. Taker Explained

* **Maker:**\
  When you post an order at a chosen price and wait for it to fill, you are a *maker*.\
  Makers add liquidity and depth to the order book.
* **Taker:**\
  When your order executes immediately against an existing order, you are a *taker*.\
  Takers consume liquidity to enter or exit positions faster.

***

### Paying Fees With $ALTO (and Saving 5%)

Traders can pay their spot trading fees using **$ALTO** and automatically receive a **5% discount**.

To enable this feature:

1. Deposit $ALTO into your spot wallet.
2. Toggle on **“Pay fees in ALTO”** under trading preferences.
3. When you place trades, fees will automatically be deducted in $ALTO — at a 5% reduced rate.

As long as you hold $ALTO and this setting is active, your trading fees will always be discounted.

***

### Order Types on Alto Spot

#### **Market Order**

A **market order** executes immediately at the best available price in the order book.\
Because it fills instantly, it’s considered a *taker order* and may incur slightly higher fees.

**Note:**

* Market orders are ideal for fast entry or exit, but the final fill price may vary during volatile conditions.

***

#### **Limit Order**

A **limit order** lets you define the exact price you want to buy or sell an asset.\
Your order enters the book and executes only if the market reaches your chosen price.

**Key Advantages:**

* Full control over execution price.
* Useful for strategic entries and exits.

**Important:**

* Limit orders may remain unfilled if the market never hits your target.

***

#### **Stop-Limit Order**

A **Stop-Limit Order** automates trade execution once a certain price threshold is reached.\
It combines a *stop price* (the trigger) with a *limit price* (the execution condition).

**Components:**

* **Stop Price:** Activates your order when the asset reaches this value.
* **Limit Price:** The exact price (or better) at which you want your trade to execute.
* **Quantity:** The amount of the asset to buy or sell.

**Example:**\
Once upward momentum is confirmed, you can enter a long position if ETH is at $3,000 by setting a stop price at $3,100 and a limit price at $3,120.

***

{% hint style="danger" %}
Key Notes

* Market orders provide **speed**, not guaranteed prices.
* Limit orders offer **precision**, but might not fill.
* Stop-Limit orders combine both — letting you automate strategic entries or exits.
  {% endhint %}


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