Forex glossary
Tier-1 dealers (market makers)
Tier-1 dealers is an informal label for major institutions providing wholesale FX quotes and execution. It is not a uniform legal category or a fixed bank list. A dealer may quote both sides, manage exposures and use other liquidity channels; prices depend on trading terms and credit access.
Illustrative example
How does it work in practice?
Suppose a large dealer quotes 1.1000 bid and 1.1002 ask for an agreed size and client. Another client may receive different terms; the tier-1 label does not set one price for the whole market.
A case to work through
Label and offer
In a fictional comparison, a tier-1-labelled dealer quotes a small amount and another a larger amount on different terms.
- Check the contracting entity and available size.
- Match side, settlement and acceptance rules.
What follows? Do not treat the label as a price or safety guarantee.
Example boundary: This creates no tier-1 institution list.
A useful distinction
Tier-1 dealers (market makers) / Liquidity providers
Liquidity provider describes a function; tier-1 informally labels a dealer group.
Check your understanding
Check offer conditions instead of relying on a label.
Show the answer and explanation
Neither guarantee
Concrete documents and terms are needed.
FX participants, access and execution
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Read the fuller explanation
Related terms
Sources and documentation
- bis.org
- FX trade execution: complex and highly fragmented – BIS
Describes dealer-customer segments, platforms and prime-brokerage credit relationships.
Document read: - The FX trade execution landscape through the prism of the 2025 BIS Triennial Survey
Describes fragmented FX execution, dealers, non-bank providers and internalised flows.
Document read:
The example illustrates the mechanism. Check current account conditions and instrument specifications with the provider.