Kaspa Market Maker Bot

High-performance Kaspa market making bot for centralized exchanges like MEXC, Gate.io, KuCoin, and BingX.
It keeps tight KAS/USDT quotes around the mid-price, manages inventory, and respects exchange rate limits to safely capture spread and provide liquidity.

Why a Kaspa Market Making Bot?

• Kaspa is UTXO-based and has no on-chain orderbook – real market making happens on CEXs.
• This bot uses CEX APIs + websockets/REST to place and manage limit orders, while you hold KAS in your exchange account or external wallet.
• Designed for low-latency quoting, inventory control, and robust cancel/replace loops.

Core Features

• Orderbook tracking: Continuously pulls top-of-book using ccxt (websocket-ready architecture).
• Spread calculation: Quotes around mid-price with configurable spread in basis points.
• Auto quoting: Automatically sends and refreshes two-sided KAS/USDT limit orders.
• Inventory management: Keeps your KAS/USDT ratio near a target and avoids over-exposure.
• Cancel/replace loop: Cancels stale orders and replaces them with fresh quotes.
• Rate-limit friendly: Token-bucket rate limiter to stay within exchange API rules.
• Metrics and logging: Prometheus metrics + structured JSON logs for monitoring.

Architecture Overview

┌────────────────┐      ┌────────────────┐      ┌────────────────────┐
│  Orderbook     │ ---> │  Quote Engine  │ ---> │  CEX Limit Orders  │
└────────────────┘      └────────────────┘      └────────────────────┘
          ▲                       │                       │
          │                       v                       │
          │        ┌────────────────────────┐             │
          │        │ Inventory & Risk Logic │ <───────────┘
          │        └────────────────────────┘
          │                    │
          v                    v
   Prometheus Metrics    Structured Logging

Key Modules

• src/config.py – Pydantic settings for spread, size, symbol, and exchange keys.
• src/exchanges/cex_client.py – ccxt-based wrapper for orderbook, balances, and orders.
• src/core/quote_engine.py – Mid-price based quote engine with spread and skew.
• src/core/market_maker.py – Main market making loop (orderbook → quotes → cancel/replace).
• src/risk/inventory.py – Inventory-based skew factor to avoid overbuying KAS.
• src/risk/rate_limiter.py – Async token-bucket for API rate limiting.
• src/services/metrics.py – Prometheus gauges/counters for price, spread, inventory, orders.
• src/main.py – Async entrypoint wiring everything together.

Getting Started

1. Requirements

• Python 3.11+
• A CEX account with KAS markets (e.g. MEXC, Gate.io, KuCoin, BingX)
• API key/secret with trading enabled and IP allowlist configured

2. Clone & Install

git clone https://github.com/your-org/kaspa-market-maker-bot.git
cd kaspa-market-maker-bot
python -m venv .venv
source .venv/bin/activate  # Windows: .venv\Scripts\activate
pip install -r requirements.txt

3. Configure Environment

Create a .env file in the project root:

ENVIRONMENT=development

SYMBOL=KAS/USDT
BASE_ASSET=KAS
QUOTE_ASSET=USDT

SPREAD_BPS=8.0
ORDER_SIZE=200.0
INVENTORY_TARGET_PCT=0.5
MAX_INVENTORY_PCT=0.8

EXCHANGE__NAME=mexc        # e.g. mexc, gate, kucoin
EXCHANGE__API_KEY=your_api_key
EXCHANGE__SECRET_KEY=your_secret_key
EXCHANGE__PASSWORD=your_passphrase_if_needed
EXCHANGE__TESTNET=false

METRICS_HOST=0.0.0.0
METRICS_PORT=9301
LOG_LEVEL=INFO

Security tip: Never commit real API keys. For production, load secrets from Vault / AWS Secrets Manager or similar.

4. Run the Bot

python -m src.main

The bot will:

• Fetch orderbook for KAS/USDT
• Compute mid-price and two-sided quotes
• Cancel existing MM orders
• Place fresh buy/sell limits every loop iteration

Prometheus metrics will be available at:

• http://localhost:9301/metrics

Market Making Logic

• Mid-price: ((best_bid + best_ask)/2)
• Spread-based quotes:
  • bid_price = mid - (spread / 2)
  • ask_price = mid + (spread / 2)
• Inventory-based skew:
  • If you hold too much KAS → widen bids / favor sells.
  • If you hold too little KAS → tighten bids / favor buys.
• Cancel/replace:
  • Before each quote cycle, the bot cancels open MM orders on the symbol.
  • It then posts new bid/ask orders at updated prices.

This design keeps quotes fresh and close to the live market while protecting your inventory profile.

SEO: Use Cases & Keywords

This repository is ideal if you are searching for:

• Kaspa market maker bot
• KAS/USDT liquidity bot
• Kaspa algorithmic trading on CEX
• Crypto market making engine for Kaspa
• CCXT-based Kaspa trading bot

You can adapt the strategy to:

• KAS/BTC or other KAS pairs
• Multiple exchanges (run one bot instance per venue)
• Different spreads and order sizes per profile (aggressive vs passive MM)

Safety & Risk Management

• Use small size and sandbox/testnet while validating the strategy.
• Enforce IP allowlists and withdrawal whitelists on your exchange accounts.
• Monitor metrics and logs for unexpected behavior (e.g. no fills, API errors).
• Start with conservative spreads and small inventory caps before scaling.

Development & Linting

ruff check src
black src
pytest

Roadmap Ideas

• Add native websocket orderbook streaming per-exchange.
• Support dynamic spreads based on realized volatility and volume.
• Add position-based kill-switches and PnL dashboards.
• Integrate with a Kaspa wallet for periodic settlement off-exchange.

License

Use at your own risk. Trading and market making involve substantial financial risk and may not be suitable for all users. Adjust licensing and compliance to your jurisdictional requirements.