As the popularity of cryptocurrencies grows, so does the number of transactions taking place. With an average of more than 12,600 Bitcoin transactions per hour, fees can add up quickly, especially when trading is available 24/7. Understanding the types of fees associated with cryptocurrency transactions, how much they are, and how to minimize them can make a significant difference in the amount you end up paying.
Types of Cryptocurrency Trading Fees
There are two types of fees associated with cryptocurrency trading: exchange fees and network fees.
Exchange Fees
For a cryptocurrency exchange to make money, it needs to charge fees for transactions, such as:
- Trading
- Deposits made when moving crypto to digital wallets
- Withdrawals and liquidations
- Loans
Network Fees
With network fees, you’re paying compensation for the resources needed to validate and record your transaction on the public blockchain. This fee is usually fixed, regardless of the amount being traded.
How Much Are Fees for Crypto?
The fees for cryptocurrency trading can vary widely depending on the exchange you use and the type of transaction you’re conducting. Most exchanges charge between 0% and 1.5% per trade, depending on whether you’re a buyer or seller.
For example, if you’ve dedicated $1,000 to invest in crypto, the fee you’ll pay for that transaction could be anywhere from $0 to $15. Coinbase, for example, charges a flat fee of 1% for all crypto transactions, so that could be around $10 for a $1,000 transaction.
Minimizing Crypto Trading Fees
The impact of fees on a cryptocurrency investor’s wallet can vary widely, and your timing and strategy for trades and other transactions matter. Here are some tips for minimizing crypto fees.
Use an Exchange With Commission-Free Trading
Some exchanges offer commission-free trading for cryptocurrencies. For instance, Robinhood, the investing app that charges no fees on stock trades, also offers commission-free trading for crypto. Fidelity and Uphold also offer 0% commission trades for retail investors.
Some exchanges charge spreads or impose fees on takers. Although you’re likely to pay fees on most exchanges, including Coinbase and Binance, there are ways to avoid or minimize them.
Buy Cryptocurrency With Coins
When you liquidate cryptocurrency into fiat currency, you are likely to face fees for that withdrawal and the related deposit into your digital wallet. Using coins to trade might be free, so consider using this strategy to reduce or eliminate your crypto fees.
Watch Transaction Amounts
Many cryptocurrency exchanges charge a percentage of the amount traded. In some cases, a flat fee is available, but in general, the bigger your transaction, the higher the fees. Therefore, you should try to break up larger transactions into smaller ones to minimize your fees.
Use Crypto Wallets
Crypto wallets are secure digital wallets that can store your cryptocurrencies. Using a wallet can help you minimize fees by avoiding exchange fees and reducing network fees. Some wallets are free, while others charge fees.
Trade During Off-Peak Hours
Crypto trading volume is higher during peak hours, which can lead to higher fees. Trading during off-peak hours can reduce fees and increase your chances of getting a better price.
Use Limit Orders Instead of Market Orders
Limit orders allow you to specify the price at which you want to buy or sell a cryptocurrency. Market orders are executed immediately at the current market price. Using limit orders can help you avoid paying higher fees associated with market orders.
Conclusion
In conclusion, cryptocurrency fees can add up quickly, and the cost of any given crypto transaction can change regularly and on short notice. To minimize these fees, investors should consider using an exchange with commission-free trading, buying cryptocurrency with coins, and watching transaction amounts. It’s also important to research and understand the fees associated with each transaction type and to have a strategy for entering and exiting cryptocurrency investments. With these tips, investors can make the most of their investments while minimizing their costs in the volatile and ever-changing world of cryptocurrency.
MEXC Fees
MEXC offers free deposits but charges withdrawal fees to cover network transaction fees, which can be high depending on the token being withdrawn. Spot trading fees are insanely low at 0%. Meanwhile, futures trading fees start at 0.00/0.02% for Maker/Taker, decreasing with higher monthly trading volume. There is also an additional 10% discount using MX Tokens. MEXC supports over 1,100 cryptocurrencies, including stablecoins, altcoins, memecoins, DeFi coins, Metaverse coins, and GameFi coins. It frequently adds new tokens and offers a Launchpad feature for emerging cryptocurrencies. A full breakdown of MEXC’s fees can be found on their Fee Schedule page, and their full list of supported tokens is available on their website.
Personal Note From MEXC Team
Check out our MEXC trading page and find out what we have to offer! You can learn more about crypto industry news. There are also a ton of interesting articles to get you up to speed with the crypto world. Lastly, join our MEXC Creators project and share your opinion about everything crypto! Happy trading!
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