Market Orders vs Limit Orders

Market Orders vs Limit Orders: What’s the Difference and Why It Matters

When you’re just getting started with crypto, you’ll come across terms like market order and limit order almost immediately. These aren’t just technical trading terms—they directly affect how your crypto is bought or sold, what price you pay, and how much control you have over the transaction. And if you’re using a platform like Coinbase Advanced, understanding these two order types is absolutely essential.

At first, most beginners use market orders without thinking twice. It’s fast, simple, and feels intuitive—just click “buy” or “sell” and it’s done. But what many users don’t realize is that market orders can result in unfavorable pricing, especially in fast-moving markets or with volatile coins.

Limit orders, on the other hand, may look more complicated, but they offer you much greater control and can reduce both slippage and fees. They’re a powerful tool for anyone looking to improve their buying or selling strategy—even if you’re just getting started.

In this guide, we’ll walk you through exactly what market and limit orders are, how they work on platforms like Coinbase and Coinbase Advanced, and when to use each one. If you haven’t yet explored the rest of our guides, you can check them out here:
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What Is a Market Order?

A market order is the most straightforward way to buy or sell cryptocurrency. When you place a market order, you’re telling the exchange: “Buy (or sell) this crypto right now at the best price available.” The order is filled instantly—no waiting, no pricing strategy, no control over the final execution price.

Let’s say Bitcoin is currently trading around $30,000. When you place a market order to buy $100 worth of Bitcoin, the platform scans the order book and fills your trade using the best available price at that moment. Sounds simple, right?

But here’s where it can get tricky: markets move fast, and if there isn’t enough liquidity or if prices are jumping around, you might end up paying more than you expected. This is called slippage—and it’s a common downside of market orders.

Pros of Market Orders:

  • Fast execution: Your trade is completed almost instantly.
  • Easy to use: Perfect for beginners who just want to make a quick purchase.
  • Always gets filled: As long as there’s a matching order, your market order will go through.

Cons of Market Orders:

  • No control over price: You accept the current price—even if it’s worse than expected.
  • Higher slippage risk: Especially during volatility or with low-liquidity coins.
  • Higher fees: On Coinbase Advanced, market orders are typically charged taker fees, which are more expensive than maker fees from limit orders.

On Coinbase, most trades are market orders by default. The interface is designed for simplicity, not flexibility. But if you’re using Coinbase Advanced, you’ll see both market and limit order options—and that’s where the real learning begins.

Next, we’ll explore limit orders and how they can help you trade smarter by controlling your price and potentially reducing your costs.

What Is a Limit Order?

A limit order is a more strategic way to buy or sell crypto. Instead of taking the current market price, you set the exact price you’re willing to pay (or accept) for a trade. The exchange will only fill your order if the market reaches your price—giving you full control over the trade’s execution.

Let’s break it down with an example:

Suppose Bitcoin is trading at $30,000, but you only want to buy if the price dips to $29,500. You place a limit order to buy at $29,500. The exchange holds your order “on the book” until the market hits your target price. If it never does, your order stays unfilled—or expires if you set a time limit.

This kind of order is available on platforms like Coinbase Advanced, where users have access to full order book data and advanced trade settings. On the basic Coinbase app, limit orders aren’t available—another reason why upgrading to Coinbase Advanced is a smart move once you’re ready.

Pros of Limit Orders:

  • You control the price: No unexpected charges or slippage.
  • Lower fees: On Coinbase Advanced, limit orders usually qualify as maker orders, which have lower fees.
  • Strategic: Great for buying dips or selling into strength without watching the market constantly.

Cons of Limit Orders:

  • Not guaranteed to fill: If the price doesn’t hit your target, the trade won’t execute.
  • Slightly more complex: Requires a basic understanding of price movement and market timing.
  • Can expire: If you set a time limit, the order will cancel if it’s not filled in time.

Using limit orders effectively can save you money and give you more control over your trading—two things every beginner should aim for. In the next section, we’ll compare when to use market vs limit orders based on your goals, urgency, and comfort level.

When to Use Market Orders vs Limit Orders

Both market and limit orders have their place in crypto trading, and knowing when to use each one can save you money, reduce stress, and improve your results. It all comes down to your priorities—speed vs control, simplicity vs strategy.

Use a Market Order when:

  • You need the trade to happen right now.
  • The asset is very liquid (high volume, low volatility).
  • You’re dealing with a small amount, and a slight price difference isn’t a big concern.
  • You’re in a situation where timing matters more than the exact price (e.g. responding to urgent news).

Market orders are great for beginners making their first purchase on Coinbase, or when buying mainstream coins like Bitcoin or Ethereum during stable price periods. They’re quick and easy—but you should still be aware of potential slippage and higher taker fees.

Use a Limit Order when:

  • You care more about the price than speed.
  • You expect the market to move in your favor.
  • You’re buying a volatile coin and want to avoid slippage.
  • You want to qualify for lower maker fees on Coinbase Advanced.

Let’s say you want to buy Bitcoin but believe the price will drop by a few hundred dollars soon. Instead of executing a market order and paying more, you can set a limit order to automatically buy at your preferred price—no need to monitor the market 24/7.

Learning when and why to use each order type is a small skill that delivers big value over time—especially once you transition from Coinbase to Coinbase Advanced, where this level of control really starts to pay off.

Common Mistakes Beginners Make with Order Types

It’s totally normal to feel overwhelmed when you first see the words “limit” or “market” order pop up. But many beginners default to the easiest option—market orders—and miss out on the potential benefits of doing things just a little differently.

Here are some common beginner mistakes—and how to avoid them:

1. Only Using Market Orders

While market orders are fast, they can result in poor execution prices during volatile moments. Beginners often overpay without realizing it, especially when buying during a price surge.

2. Forgetting About Slippage

Market orders are vulnerable to slippage, where the final price you get is worse than expected. This is especially painful when trading large amounts or during high-volume events.

3. Avoiding Coinbase Advanced

Many beginners stick with Coinbase because it feels safer. But switching to Coinbase Advanced gives you the option to place limit orders, see real-time order books, and reduce your fees. It’s not as hard to use as it looks—and you can get started easily.

4. Placing Limit Orders Too Far from Market Price

Setting an unrealistically low buy price (or high sell price) might feel strategic, but often leads to unfilled orders. It’s important to place limit orders near real price zones to improve your chances of execution.

5. Not Watching the Clock

Some platforms allow you to set expiration times for limit orders. Beginners often forget this, resulting in expired orders that never fill.

Avoiding these mistakes early can make you a more confident and cost-effective trader—and help you build good habits for the long run.

Which Is Better for Beginners?

So which type of order is best for beginners: market or limit?

The honest answer is—it depends on your goals and how comfortable you are with trading.

If You’re Brand New:

Stick with market orders on Coinbase for your first few buys. The interface is simple, and the learning curve is low. Just know that you’re likely paying higher fees and giving up control of the price.

If You’re Ready to Level Up:

Move to Coinbase Advanced and learn to use limit orders. With just a little practice, you can:

  • Set your desired price.
  • Avoid overpaying during market spikes.
  • Qualify for maker fee discounts.
  • Feel more in control of every trade.

Even if you only place limit orders once in a while, it’s a powerful tool to have in your crypto toolkit. And the sooner you start using it, the sooner you’ll gain the confidence and control that make crypto trading more strategic.

You can explore Coinbase Advanced now using our referral link—it’s free to switch, and you’ll still be using the same secure Coinbase account.

Frequently Asked Questions (FAQ)

Are market orders bad for beginners?
Not at all. Market orders are simple and fast. But they can result in worse pricing and higher fees, especially during volatility.

What’s the biggest risk with a market order?
Slippage—your trade executes at a price worse than you expected. You lose value instantly without realizing it.

Can I use limit orders on regular Coinbase?
No. Limit orders are only available on Coinbase Advanced, which is free to access with your regular account login.

Do limit orders always fill?
No. If the market doesn’t reach your price, the trade won’t execute. You can choose to leave it open or set an expiration time.

Which order type has lower fees?
Limit orders, when they qualify as maker orders, usually have lower fees—especially on Coinbase Advanced.

Should beginners switch to Coinbase Advanced?
Yes—when you’re ready. It offers more tools, more transparency, and lower fees.

Final Thoughts: Take Control of Your Trades

Understanding the difference between market and limit orders is one of the simplest ways to level up your crypto journey. While market orders are fast and easy, they come at the cost of price control and higher fees. Limit orders may seem intimidating at first, but they empower you to trade smarter—not just faster.

As a beginner, there’s no shame in starting with market orders. But the sooner you understand how to place a limit order—especially on platforms like Coinbase Advanced—the sooner you’ll start saving money, reducing risk, and feeling confident in your decisions.

Want to learn more about trading smarter, reducing fees, and managing risk? Explore our full Crypto Guides section—it’s packed with beginner-friendly explainers that put you in control.

Ready to trade with more precision? Sign up for Coinbase Advanced using our referral link and start using limit orders today.