Quoted Spread
Pronunciation: KWOH-tid SPRED
Also known as: Displayed Spread, Quoted Bid-Ask Spread
Definition
A quoted spread is the difference between two exchange rates or prices offered for buying and selling an asset, often representing part of the cost of conversion. The exact benchmark must be disclosed.
Overview
What it means and why it matters
A quoted spread is the difference between two exchange rates or prices offered for buying and selling an asset, often representing part of the cost of conversion. The exact benchmark must be disclosed.
How it works in practice
A conversion provider offers a buy quote and sell quote around a reference market price. When a merchant changes payment proceeds into another asset, the executed rate may include the bid-ask spread plus separately stated trading or service fees.
Technical detail without the jargon
A spread expressed in percentage terms needs a reference denominator; using mid-market price is common but not universal. Separate spread from slippage, which occurs when actual execution differs from a valid quote or expected price.
A deeper point to understand
Spread comparisons require consistent order direction. A merchant selling ETH into stablecoin should compare sell quotes, not a provider’s attractive buy quote. The reported spread is an estimate of conversion economics only when the quoted size and reference price are relevant to the actual trade.
Common mistakes and limitations
A tight headline spread does not guarantee cheap execution if the provider adds a fixed commission, poor reference price or extra withdrawal fees. Compare all-in received amounts for the same asset, size and timing.
What to check in a real payment system
Show the buy and sell quotes, reference market price and calculation time before comparing rates. Measure total received after all service fees, not only the spread. Review whether spreads widen materially for larger conversions or outside liquid trading hours.
Related concepts
Crypto Settlement, Crypto Payout, Network Fee.
Further reading
Bank for International Settlements — Basel Committee Publications.
Example
The mid-market price of a token is $1.00, but the provider buys from the merchant at $0.997 and sells at $1.003. The bid-ask spread is $0.006, or about 0.6% of the mid-price.
Comparison
Quoted spread measures the stated price gap; network fees and explicit conversion commissions are separate costs. Slippage compares expected and realized execution prices.
Key Takeaway
A spread expressed in percentage terms needs a reference denominator; using mid-market price is common but not universal.
Sources
- Disclosure of Order Execution and Routing Practices — U.S. Securities and Exchange Commission (2026-08-02)
- Special Study: Payment for Order Flow and Internalization in the Options Markets — U.S. Securities and Exchange Commission (2026-08-02)
- FX Global Code — Global Foreign Exchange Committee (2026-08-02)