Market, Limit, and Stop Orders

A market order buys or sells a cryptocurrency immediately at the best price currently available. A limit order only executes at the price you set or better. A stop order sits dormant until the price hits a trigger level and is most often used to limit losses. In short, market orders prioritise speed, limit orders prioritise price, and stop orders automate an exit when a condition is met.

The order type you choose shapes the average price you pay, the fee you are charged and whether your trade happens at all. Here is how each one works on a typical crypto exchange, with worked examples.

Before you place an order: read the pair

In a BTC/USD pair, BTC is the asset you are buying or selling and USD is the currency the price is quoted in. Buying means spending dollars to get bitcoin; selling means the reverse. Some order screens ask for the amount in BTC, others for the amount of dollars to spend, so always check the unit next to the number.

Funds reserved for open orders are deducted from your available balance until the order fills or you cancel it, which is the most common reason a balance looks lower than expected. If you are new to buying crypto, our guide on how to buy bitcoin covers the basics first.

What is a market order?

A market order matches immediately against the best resting orders on the other side of the book: sell orders when you buy, buy orders when you sell. The last traded price on screen is not necessarily what your whole order will get. If there is not enough size at the best level, the rest of your order fills at the next prices.

Example: you want 10 tokens. The book offers 4 at $100 and 6 at $102. You pay $1,012 in total, an average of $101.20, plus fees. Multiplying the first price by 10 would suggest $1,000 and understate the real cost. That difference is slippage, and it grows in markets with thin liquidity.

When to use it: when speed matters more than the exact price, and for small orders in deep, liquid markets.

What is a limit order?

A buy limit fills at your price or lower; a sell limit fills at your price or higher. If you never want to pay more than $100 for a token, you place a $100 buy limit. If the price stays at $103, your order simply waits. A limit order protects your price, but it does not guarantee a fill.

If your limit price can match existing orders straight away, it executes immediately. Exchanges call the side that adds a resting order to the book the maker and the side that takes existing liquidity the taker, and maker fees are usually lower. A “post-only” option, offered on many platforms, rejects any order that would execute immediately, guaranteeing you are the maker.

When to use it: when you have a specific price in mind, in thin markets and for larger orders.

What is a partial fill?

If you want 20 tokens at $100 but only 8 are offered at that price, your order is partially filled. The 8 tokens land in your account, and the remaining 12 wait or are cancelled depending on the order’s time-in-force. Cancelling does not reverse the part that has already filled, so always check the trade history for the final result.

What is a stop order? Stop-market vs stop-limit

A stop order has a trigger (stop) price. When the market reaches it, the order activates:

• Stop-market: sends a market order once triggered. Execution is prioritised, but in a fast fall the fill can come well below the stop price.
• Stop-limit: places a limit order at your chosen limit price once triggered. Your price is protected, but if the market gaps below the limit, the order may never fill.

Example: you bought a token at $100 and set a stop at $90 with a limit of $89. When the price touches $90, a sell limit at $89 is placed. If the market drops straight to $85, your order may sit unfilled. A stop-market order would have sold, but below $90. A stop therefore does not lock your loss at an exact figure, especially when volatility is high.

Other order types: OCO and trailing stops

An OCO (one-cancels-the-other) order links two orders so that when one fills, the other is cancelled. You might place a take-profit sell limit at $120 and a stop at $90 on the same position; whichever triggers first cancels the other. A trailing stop moves the stop level up behind the price by a fixed percentage or amount as the market moves in your favour. Not every exchange offers these.

Which price triggers a stop?

Depending on the exchange and product, a stop may be triggered by the last traded price, an index price or a mark price. This matters most in futures: if the chart you watch differs from the trigger source, your stop can fire at an unexpected moment. Futures platforms also offer a “reduce-only” flag that ensures an order can only shrink an existing position. Our guide to leverage and liquidation covers stops on leveraged trades.

GTC, IOC and FOK explained

• GTC (Good ’Til Cancelled): stays open until you cancel it.
• IOC (Immediate or Cancel): fills whatever it can immediately and cancels the rest.
• FOK (Fill or Kill): cancels the whole order unless it can fill in full immediately.

Which order type should you use?

• You need to trade now: a market order, ideally in liquid pairs and for modest sizes.
• You are waiting for a specific price: a limit order, also the safer choice in thin markets and for large trades.
• You want to protect a position: a stop-market or stop-limit order, or an OCO if you also have a profit target.

A quick check before you confirm

A hypothetical example: buying 20 tokens at $75 costs $1,500 before fees. With a 0.10% fee charged in dollars, you pay another $1.50. If the fee is taken in the token instead, you receive 19.98 tokens. Before confirming, check the pair, direction, order type, quantity, price, any trigger price and which balance the fee comes from. To estimate spread and slippage costs as well, see our guide to spread and slippage.

Sources

• Coinbase: market, limit, and stop orders
• Coinbase Help: order options
• Investor.gov: basic order types