You’re ready to buy your first Bitcoin on Kraken. But when you look at the trading screen, you see two mysterious buttons: “Market Order” and “Limit Order”. What’s the difference? Which one should you choose? In this guide, I’ll explain the simple mechanics behind order books, show you why Market Orders can cost you extra money (through price slippage), and demonstrate how Limit Orders put you in complete control of your entry price — saving you money on every trade. By the end, you’ll never overpay for crypto again.
Market Orders are convenient but expensive. You pay for speed. Limit Orders require a few extra seconds but save you money. As a beginner, you should almost always use Limit Orders — especially when buying larger amounts or during volatile market conditions.
1. 📖 How an Order Book Works (Simple Explanation)
Before understanding Market vs Limit orders, you need to know what an order book is. Think of it as a live auction where people are constantly placing bids to buy and offers to sell.
The order book has two sides:
- 🟢 Bids (Buy orders) — people who want to buy Bitcoin at a specific price. The highest bid is the best price a seller can get immediately.
- 🔴 Asks (Sell orders) — people who want to sell Bitcoin at a specific price. The lowest ask is the best price a buyer can get immediately.
The difference between the highest bid and the lowest ask is called the spread. When you place a Market Order, you’re saying: “Fill my order immediately at whatever price is available.” When you place a Limit Order, you’re saying: “Only fill my order at THIS specific price or better.”
Imagine a farmers market with 10 apple sellers. The cheapest apples are $1. The most expensive are $1.10.
- Market Order: You run to the nearest seller and buy immediately — you might pay $1.10 if that’s the only one available.
- Limit Order: You say “I’ll only buy at $1.00” — and wait until a seller accepts your price.
2. 🟢 What Is a Market Order? (Instant but Risky)
A Market Order is an instruction to buy or sell immediately at the best available price in the order book .
- ⚡ Speed: Instant — your order executes in milliseconds
- 💰 Price control: None — you accept whatever price is available
- 📊 Best for: Small trades, urgent entries, high liquidity pairs (BTC/USD, ETH/USD)
- ⚠️ Risk: Price slippage — you may pay more than expected
Example of a Market Order on Kraken
You want to buy $1,000 worth of Bitcoin (BTC) using a Market Order on Kraken.
- The current displayed price is $80,000 per BTC.
- But there’s only $500 worth of BTC available at $80,000.
- The next seller wants $80,010 for their BTC.
- Your Market Order buys the cheap BTC first, then automatically buys the more expensive BTC.
- Result: Your average purchase price becomes $80,005 — $5 more per BTC than you expected.
For a $1,000 purchase, this slippage cost you ~$0.06 — not huge. But for larger trades ($10,000+), slippage can cost you $50-200.
- ✅ You’re buying a very small amount ($10-50) — slippage is negligible
- ✅ You need to enter or exit a position immediately (urgent trade)
- ✅ You’re trading highly liquid pairs like BTC/USD or ETH/USD on Kraken Pro
- ✅ You’re using Kraken’s “Simple Buy” interface (which uses market orders by default)
3. 🔴 What Is a Limit Order? (Control Your Price)
A Limit Order is an instruction to buy or sell only at a specific price (or better). The order sits in the order book until someone matches it .
- ⚡ Speed: Variable — could be instant or take days
- 💰 Price control: Complete — you set the exact price
- 📊 Best for: All trades where you care about price
- ✅ Advantage: No slippage — you pay exactly what you want
Example of a Limit Order on Kraken
Bitcoin is currently trading at $80,000. You want to buy at $79,500 — $500 lower than the current price.
- You place a Limit Order to buy 0.01 BTC at $79,500.
- Your order sits in the order book waiting for sellers.
- If the price drops to $79,500, your order executes automatically.
- If the price never drops, your order never fills — you keep your cash.
- Result: You get your exact price — no slippage, no surprises.
- ✅ You’re buying a significant amount ($500+)
- ✅ You want to buy at a specific support level (technical analysis)
- ✅ You’re trading low-liquidity altcoins (wide spreads)
- ✅ You’re not in a rush and can wait minutes to hours for your price
- ✅ You want to pay the lowest possible fees (Limit Orders are “maker” orders with lower fees)
4. 📊 Key Differences: Market Order vs Limit Order
| Feature | Market Order | Limit Order |
|---|---|---|
| Execution Speed | Instant (milliseconds) | Variable — could be instant or never |
| Price Control | ❌ None — you accept market price | ✅ Complete — you set the price |
| Slippage Risk | ✅ Yes — can cost you extra | ❌ No — you control exact price | Fee Type | Taker fee (higher) | Maker fee (lower, sometimes 0%) |
| Order Guarantee | ✅ Fills immediately | ⚠️ May never fill (if price doesn’t reach your limit) |
| Best For | Small trades (<$100), urgent entries | Large trades ($500+), patient entries |
On Kraken Pro, Limit Orders are “maker” orders (you add liquidity to the order book). Market Orders are “taker” orders (you remove liquidity). Maker fees can be as low as 0.00% for high-volume traders, while taker fees start at 0.16% for beginners. Over many trades, using Limit Orders saves you real money.
5. 📱 How to Place a Limit Order on Kraken (Step-by-Step)
Follow these steps to buy Bitcoin using a Limit Order on Kraken Pro — the platform’s advanced trading interface with lower fees .
📌 STEP 1: ACCESS KRAKEN PRO
- Log into your Kraken account.
- Click “Trade” → “Kraken Pro” (or download the Kraken Pro app on mobile).
- Select the trading pair — e.g., BTC/USD.
📌 STEP 2: SELECT LIMIT ORDER
- In the order panel, click the “Limit” tab (not “Market”).
- You’ll see two empty fields: “Price” and “Amount”.
📌 STEP 3: SET YOUR PRICE
- Look at the current market price (e.g., $80,000).
- Decide the price you want to pay. For a buy order, set your price BELOW the current market price.
- Example: Enter $79,500.
📌 STEP 4: SET YOUR AMOUNT
- Enter the amount of Bitcoin you want to buy (e.g., 0.01 BTC).
- Or use the “Total” field to specify how much USD you want to spend.
📌 STEP 5: PLACE THE ORDER
- Click “Buy BTC”.
- Your order will appear in the “Open Orders” section.
- Wait for the price to drop to $79,500 — your order will execute automatically.
On Kraken Pro, enable “Post-Only” mode. This ensures your order is placed as a Maker order (adding liquidity). If it would execute immediately as a Taker, it cancels instead. This guarantees you pay the lower Maker fee (0.00-0.16% instead of 0.16-0.26%).
6. ⚡ How to Place a Market Order on Kraken (For Small Trades)
📌 STEP 1: GO TO KRAKEN PRO
- Same as above — access Kraken Pro.
📌 STEP 2: SELECT MARKET ORDER
- Click the “Market” tab.
- Enter the amount you want to buy (in BTC) or spend (in USD).
📌 STEP 3: EXECUTE
- Click “Buy BTC”.
- The order fills instantly at the best available price.
The regular Kraken “Buy Crypto” button (not Pro) uses Market Orders with higher fees and spreads. If you want to save money, always use Kraken Pro — it’s free and just as easy once you learn the basics.
7. 💰 Real Example: Saving Money with Limit Orders
Let’s compare buying $1,000 worth of Bitcoin using Market Order vs Limit Order during normal market conditions.
Note: The Limit Order example assumes you’re patient and buy on a dip. Market Order is instant but costs more. For a $10,000 purchase, the difference could be $50-200.
For your first purchase of $20-100, the difference between Market and Limit Orders is negligible (a few cents). But as your portfolio grows, using Limit Orders will save you meaningful money. Develop good habits now — use Limit Orders for any purchase over $100.
8. 🎯 When to Use Market Order vs Limit Order (Decision Guide)
🎯 USE MARKET ORDER IF:
- 💸 You’re buying less than $50-100
- ⚡ You need crypto instantly (urgent trade)
- 📊 You’re trading extremely liquid pairs (BTC/USD, ETH/USD)
- 🔄 You’re selling into a rapidly falling market (to cut losses)
🎯 USE LIMIT ORDER IF:
- 💰 You’re buying $100+ (slippage becomes meaningful)
- 📉 You want to buy at a specific support level
- 🪙 You’re trading altcoins with low liquidity (wider spreads)
- ⏳ You’re patient and can wait minutes to hours
- 🏦 You want to pay the lowest possible fees (maker fees)
9. 📱 Kraken vs Kraken Pro: The Hidden Fee Trap
Many beginners use Kraken’s “Simple Buy” interface because it’s easy. But this convenience comes at a cost.
Kraken’s “Simple Buy” interface can cost you 10-20 times more in fees than using Kraken Pro with Limit Orders. A $1,000 purchase could cost you $20 in Simple Buy vs $1 in Kraken Pro. Always use Kraken Pro (it’s free!) and learn to use Limit Orders.
10. 📝 Kraken Pro Mobile App: Limit Orders on the Go
📌 HOW TO PLACE A LIMIT ORDER ON KRAKEN PRO MOBILE:
- Download “Kraken Pro” from App Store or Google Play.
- Log in with your Kraken credentials.
- Select a trading pair (e.g., BTC/USD).
- Tap “Limit” (not “Market”).
- Enter your desired price and amount.
- Enable “Post-Only” for lower maker fees.
- Tap “Buy” — your order is now waiting in the order book.
11. ❓ Frequently Asked Questions About Orders on Kraken
Understanding the difference between Market Orders and Limit Orders is one of the first skills every crypto investor should master. Limit Orders put you in control of your price and save you money on fees. Market Orders are convenient but cost you extra through slippage and higher taker fees.
For your first purchase on Kraken, follow this simple rule: If you’re buying less than $50, a Market Order is fine. If you’re buying $50 or more, use a Limit Order on Kraken Pro. Set your price slightly below the current market price (for a buy), enable “Post-Only” for lower fees, and wait. You’ll get your crypto at exactly the price you want — without overpaying.
Start with a small test trade ($20-50) using a Limit Order to learn the process. Once you’re comfortable, scale up. Kraken is one of the most trusted exchanges — use it wisely, and you’ll save thousands in fees over your investing lifetime.