A market maker is a player in the financial markets who has the responsibility of keeping the trading activity alive by always being ready to buy and sell an asset. They do not wait for trades to happen but instead place orders simultaneously on both sides of the market which in turn, allows others to enter or exit their positions without long delays or extreme price swings occurring.
The market makers make profit from the small difference (spread) between their buying and selling prices. Instead of speculating on price direction, they rely on volume and consistency. They help the market by executing a large number of trades at a small margin, thereby stabilizing the market and increasing its efficiency.
In cryptocurrency markets, the role of the market makers is very significant as the liquidity may be low, especially for new or low-volume tokens. Most exchanges require the assistance of professional market-making firms to keep the order books alive and avoid drastic price fluctuations. On the other hand, traders could be left with the difficulty of not having their orders executed at fair prices.
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The role of market makers is on the opposite side of that of a trader who speculates. They are continuously willing to trade and thus a service to the market. They are, however, offered lower fees or incentives that are available for the exchanges.