If you want to buy and sell bitcoin and other cryptocurrencies on an exchange, you’ll need to be aware of the fees that apply to trading. From deposit and trading fees to the charges that apply when you withdraw funds from your account, the fees imposed by your chosen platform can have a big impact on the overall cost of your trades.
In this guide we’ll explore the different charges that apply, how they vary between exchanges, and how you can save money when buying and selling digital currency.
Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific
provider, service or offering. It is not a recommendation to trade.
Exchange fee comparison
How much does it cost to deposit, trade and withdraw funds from a crypto exchange? Check out the table below for a comparison of the fees charged by a handful of popular exchanges.
Deposit fees
While many exchanges won’t charge a fee whenever you transfer funds into your account, some will. However, it’s worth pointing out that the amount charged may vary depending on the payment method you choose or the currency you deposit. If you’re using an exchange that accepts deposits in fiat currency, a different fee may apply to credit card and bank transfer deposits.
If you’re transferring digital currency into your exchange account, the fee could change depending on the coin you deposit. For instance, bitcoin deposits may attract a fee of 0.001 BTC, while Ether deposits might be charged at a flat rate of 0.01 ETH.
Trading fees
When you’re ready to buy or sell digital currency through an exchange, you’ll need to consider the trading fee that will apply to your transaction. Trading fees are expressed as a percentage of the total value of your transaction.
Some exchanges will impose a flat fee, for example 0.2% of the transaction value, on all trades. However, many exchanges split their trading fees into two separate fees:
Maker fees
The maker fee applies when your order is not immediately matched against a trade already on the exchange’s order book. This means you’re adding liquidity to the order book, so most exchanges will reward you with lower fees.
If you place a limit order on a crypto exchange, you specify that you want to buy or sell but only at a particular price point. If your order isn’t matched immediately, for example if the limit price on your buy order is below the current market price, you’ll be charged the maker fee when your order is eventually matched.
Because market makers add liquidity to the order book, some exchanges will even offer them fee rebates when trading. For example, market makers on HitBTC receive a 0.01% rebate on their trade.
Taker fees
The taker fee applies to trades that are executed against another trade already in the exchange’s order book. This removes liquidity from the market, so taker fees are usually higher than maker fees.
When you place a market order on a crypto exchange, this means you want to buy or sell a particular coin as soon as possible and, as a result, the taker fee applies.
Binance's fee model
Level
30d Trade Volume (BTC)
&
BNB holdings
Maker
Taker
Maker
Taker
General
< 100 BTC
or
≥ 0 BNB
0.1000%
0.1000%
0.0750%
0.0750%
VIP 1
≥ 100 BTC
&
≥ 50 BNB
0.0900%
0.1000%
0.0675%
0.0750%
VIP 2
≥ 500 BTC
&
≥ 200 BNB
0.0800%
0.1000%
0.0600%
0.0750%
VIP 3
≥ 4500 BTC
&
≥ 1000 BNB
0.0700%
0.0900%
0.0525%
0.0675%
VIP 4
≥ 10000 BTC
&
≥ 2000 BNB
0.0600%
0.0800%
0.0450%
0.0600%
VIP 5
≥ 20000 BTC
&
≥ 3500 BNB
0.0500%
0.0700%
0.0375%
0.0525%
VIP 6
≥ 40000 BTC
&
≥ 6000 BNB
0.0400%
0.0600%
0.0300%
0.0450%
VIP 7
≥ 80000 BTC
&
≥ 9000 BNB
0.0300%
0.0500%
0.0225%
0.0375%
VIP 8
≥ 150000 BTC
&
≥ 11000 BNB
0.0200%
0.0400%
0.0150%
0.0300%
Fees last updated 2 August, 2018
Withdrawal fees
Once you’ve acquired the coins and tokens you want, you’ll most likely want to transfer them off the exchange and into a secure, private wallet. However, when you do so, you’ll almost always be hit with a withdrawal fee.
Just like deposit fees, withdrawal fees vary depending on the following:
The currency being transferred if making a crypto withdrawal
The withdrawal method being used if transferring fiat currency
Crypto withdrawals tend to attract a flat fee, whereas fiat withdrawals can be hit with a flat fee or a percentage-based fee.
It’s easy to forget about withdrawal fees when choosing an exchange, but being hit with a hefty transfer fee when moving your funds into a wallet can make a big difference to the overall cost of your transaction. With this in mind, remember to check the fine print to find out what withdrawal fees apply before choosing an exchange.
Fee scaling
Cryptocurrency exchange fees can also vary from one account to the next, with some customers able to access reduced costs based on a number of factors, including the following:
Account verification. By providing additional information to verify your account, such as personal details and proof of ID, you may be able to access smaller fees.
Trading volume. Some exchanges offer tiered fee structures based on the amount of cryptocurrency each user trades per month – the higher your trading volume, the lower your fees. As an example, Bitfinex’s tiered fee structure ranges from 0.1% maker and 0.2% taker fees for users with a 30-day trading volume of less than $500,000 through to 0% maker and 0.1% taker fees for users with a 30-day trading volume of $30 million or more.
Length of membership. You may also find that the longer you hold and use an account on a particular exchange, the less you’ll need to pay in fees.
Crypto exchange fees: what you need to know
The most important thing to remember when calculating the cost of trading cryptocurrency is to read the fine print. Fees vary not only from one exchange to the next but also within a single exchange – from your account verification status to the volume of trades you place per month to the currency you’re trading, there are several factors that can affect how much you’ll need to pay in fees. Check with your exchange so that you’re familiar with all the fees that apply to your account.
Fee discounts
It’s also worth keeping an eye out for any fee discounts you may be able to take advantage of. For example, some exchanges will offer discounted fees to new customers for a fixed promotional period after they first register for an account.
Other exchanges will also offer reduced fees to customers who hold a balance of the exchange’s native currency. For example, Binance customers who hold Binance Coins (BNB) can use their BNB to access discounted fees on the trades they place through their Binance account. This discount reduces over time and is 50% during the first year, 25% during the second year and so on.
Elsewhere, Huobi users can use Huobi Tokens (HT) to purchase a VIP membership. There are five membership levels available – the most basic level costs 120 HT a month and entitles you to a 10% fee discount, while the premium membership costs 12,000 HT per month and allows you to save 50% on fees.
Choosing an exchange
Fees will no doubt be one of the factors you consider when comparing and choosing crypto exchanges, but they shouldn’t be the only one. You’ll also need to take into account the security measures a platform has in place, the currencies it supports and the customer support on offer.
Disclaimer: Cryptocurrencies are speculative, complex and involve significant risks – they are highly
volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of
future performance. Consider your own circumstances, and obtain your own advice, before relying on this information.
You should also verify the nature of any product or service (including its legal status and relevant regulatory
requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may
have holdings in the cryptocurrencies discussed.
Images: Shutterstock
Disclosure: At the time of writing, the author holds ADA, IOTA and XLM.
Tim Falk is a freelance writer for Finder, writing across a diverse range of topics. Over the course of his 15-year writing career, Tim has reported on everything from travel and personal finance to pets and TV soap operas. When he’s not staring at his computer, you can usually find him exploring the great outdoors.
If you want to know how to buy Power Ledger (POWR) tokens using either HKD or cryptocurrency, you’ll find the help you need in this comprehensive guide.
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