Cryptocurrency is booming right now! As of this writing, Bitcoin is at an all time high of $9,939.50 ascending towards $10,000!
But you know what kills profits? Fees. In this article, I will explain in detail the best cryptocurrency exchanges with the lowest fees.
The fee structure for GDAX has a variety of options. The taker fee (which is part of the transaction) differs among currencies. Another thing to keep in mind is the “user 30 day volume.”
Volume is known as the amount of currency traded on the exchange. When you’re the “taker” (seller),
your fee structure differs depending on the time your order is matched with another person. So if your order is immediately matched with another person, then, depending on what type of digital currency (let’s use Bitcoin for this example), you’ll pay 0.1%-0.25%.
If you’re order is not matched right away, whether it’s not matched at all, or partially matched, the fee structure is 0%. In this case, you’re a maker. To simplify the fee you have to pay, the more volume you trade in 30 days, the more you have to pay in fees.
A nice perk that GDAX offers is no transfer fees if you have funds in Coinbase and decide to move it into GDAX.
Coinbase is definitely one of the most popular exchanges right now. I recently wrote a post about this exchange and
how it’s getting money from venture capitalists. When you’re outside money from a lot of different sources, then you know someone believes in you.
As for fees, there are 2 methods when determining fee structure. Whichever is the greater of either the minimum fee or percentage fee gets chosen as the fee percentage.
The minimum fee has rates that’re essentially the same whether you’re buying or selling. If you’re paying or selling for virtual currency, then the going rate on Coinbase is 1.49%.
It doesn’t matter if you use your U.S. bank account or Coinbase USD wallet.
But a minimum amount of $0.15 is required whether you purchase or sell through a U.S. bank account. If you’re paying through credit/debit card then you pay a 3.99% fee. If you’re selling through Paypal, the fee is also 3.99%.
There are 2 components to the percentage fee. The first component is the variable fee, and the second is the fixed fee. The variable fee is 1% based on the amount of the transaction and the minimum fee is $1.00. The maximum fee is $50.00.
A fixed fee ironically depends on the region and payment type, but a fixed rate percentage is 2.49%.
Buying And Selling Digital Currency
When buying and selling digital currency on Coinbase, the fees are put into the calculation to give you the total amount. For example, if I bought 90 Bitcoins for $1 and the fee percentage was 1.49%, my total would be $88.659. It works just like taxes.
Cex.io is another awesome exchange because it offers margin trading. This allows traders to exchange with funds that aren’t even theirs. It’s like investing in money that’s not even yours. They offer this with BTC/USD and ETH/BTC.
Even though this doesn’t relate to fees, I just want to tell you because it’s a cool feature, but I digress. Now, on to fees.
The fee schedule is very similar to GDAX. One obvious similarity is the maker fee. Makers literally pay a percentage of 0% in fees. That’s hot stuff! But just like GDAX, takers take a specific percentage of fees depending on the amount of trading volume.
To give some numbers, a trader who trades in the volume of less than, or equal to 5 BTC pays a percentage of 0.20%. If we were to go up one step higher, and trade in the range of less than, or equal to 30 BTC, then you have to pay a percentage fee of 0.19%.
The percentages go down the more you trade. It gives more incentive to keep on trading if you look at the big picture. Also, the fee structure percentage ends at 0.10% when you have a trading volume of more than 6,000.
Poloniex gets pretty technical, and you can tell right when you land on the site. It’s an exchange that trades mostly Bitcoin, Ethereum, and Monero. Just like CEX.IO, it offers margin trading also.
The first thing about Poloniex that caught my eye was the maker fee. Most of the exchanges we talked about so far haven’t had any fee percentage. But for Poloniex, makers pay a max fee percentage of 0.15%.
Kraken is an exchange founded in San Francisco. Fiat currencies such as U.S. dollars, Japanese yen, and British pounds all trade on Kraken. This is the first exchange to introduce trading price and volume which makes trusting Kraken easier.
With more information and more digital currencies coming onto the exchange, Kraken’s popularity keeps rising. Another thing that differentiates Kraken from its competitors is it offers Ether Dark Pool trading.
Kraken describes Ether Dark Pool trading as “placing large Ether orders without displaying their intentions to the public.” In addition, Kraken also offers Bitcoin Dark Pools.
Personally, I would stay out of Dark Pools unless you’re a professional trader. Kraken says advantages of dark pools are “reduced market impact and better price for large blocks”, isn’t enough incentive for me to join a dark pool. You have to imagine everybody else in that Dark Pool is also professional traders.
That’s why trading in the Dark Pool can be a scary thought. Add the fact that Dark Pool trading fee percentages range from 0.20%-0.36% depending on the trade volume. Now enough of Kraken’s Dark Pool, let’s talk about their regular fee schedule.
For Kraken, fees depend on two things. Trade volume and the “pair.” An example of a pair is Bitcoin to Ethereum, or Ethereum to U.S. dollars. But just like the other exchanges, lower fees are charged when you trade more in volume. Moreover, Additional fees are charged when you
communicate using paper. The fee charged is $60/page.
Below is an image taken from Kraken’s website. It shows the fee structure for Bitcoin/USD along with margin and leverage levels. There are more images like these on Kraken’s website showing different conversions and their fee schedules.
Bittrex is a solid exchange with low fees. It offers currencies like Ubiq, Litecoin, Blackcoin, and more. Honestly, Bittrex doesn’t stand out from the rest in terms of services, but its reputation and currencies on their markets is solid.
Fee structure for Bittrex is pretty straight on. 25% commission on all trades is the fee structure so it doesn’t give much incentive to trade on Bittrex. Similar to Kraken, requesting paper copies has a fee of $10 plus $1 per page for shipping and handling if it’s in the U.S. Shipping outside of the U.S. will incur additional charges.
Low fees are a priority when trying to make as much money as possible. From the selection of exchanges we have here, it’s important that you, as an investor, or trader, find one which suits your preference.
Obviously, the maker/taker structure is different with each exchange. In some exchanges, the fee structure for makers can be 0%. On the other hand, exchanges like Poloneix make makers pay a max fee percentage of 0.15%.
Looking at that fact can discourage one from signing up with Poloneix. But taking into consideration, the liquidity, and prices for virtual currencies on a specific exchange is important. Whatever the case, some exchanges have higher prices for the same currency than another exchange.
Hopefully with the information I have given you, you’ll take factors such as fees when signing up with your next exchange.