Market makers provide liquidity, not hunt for it. Any trader with a limit order becomes one temporarily. Dedicated firms profit from the spread between buy and sell prices, and their presence keeps slippage low enough for retail traders to actually make money.
Most retail traders don't know. A lot of people believe market makers are the banks, but market making firms are a very specific type of firms that have a very specific business model. Market makers are what we call the liquidity providers. So they're not hunting for liquidity. They actually are your liquidity, and you should be thankful they exist because otherwise you would get slipped so hard that you could not be profitable. The reason you can be having an edge is because of the liquidity provided by the market makers. A market maker can be anyone. If I place a buy limit, I'm a market maker. I offer, so I create market for people to interact with. But a market market making firm is a firm that does only market making, which is placing buy limits and sell limits at the best bid and the best ask. What they do is they constantly put orders on the sell side, on the buy side. So the spread that you pay as a trader is the profit margin of market making firms, and the only job they do is providing liquidity.
