How Do Exchanges Use Tiered Fee Structures to Incentivize High-Volume Trading?

Exchanges use tiered fee structures to reward traders who generate high trading volumes. These tiers are typically based on a user's 30-day trading volume.

As a trader's volume increases, they move up through the tiers and qualify for lower maker and taker fees. This system incentivizes market makers and high-frequency traders to use the platform, which in turn increases liquidity and deepens the order book for all users.