Is there a fee for withdrawing crypto?

Many exchanges do charge customers for making withdrawals from their accounts. Coinbase, for example, charges fees based on network fees for wallet-to-wallet transactions. Binance.US withdrawal fees vary by token and network.

How much is the fee for crypto?

Cryptocurrency trading fees change frequently and vary by exchange, by the trader's trading activity and the type of transaction. They currently range from 0% to 4.5% on popular exchanges.

How do I avoid fees when buying crypto?

Network fees and spreads are unavoidable, and even no-fee exchanges might charge for other services you use. But you can minimize the fees you pay. SoFi recommends trading less often and using limit orders, where your trades are conditioned on a certain price, rather than market orders, which execute at the current price and often cost more in fees. In addition, shopping around can help you find the lowest fees, but exchange fees change often, so the lowest price you find today might not be the lowest price available a week or month from now.

Who has the lowest fees for buying crypto?

Fees are too variable to say definitively that a particular exchange has the lowest fees. For example, Kraken is known as a low-fee platform, but like other platforms, it charges different fees for makers and takers, and each of those groups pay sliding fees based on monthly trading volume. Binance.US uses a similar pricing model for certain trading pairs. It's costlier than Kraken's as of Aug. 10. But Binance.US also offers free trades for specific cryptocurrency pairs. The best strategy is to compare fees for the currencies you trade, the types of trades you make, your monthly trading volume and how you manage your deposits, withdrawals and payment methods -- all of those factors affect the fees you'll pay.

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Crypto Fees: How To Buy Crypto Without the Fees

August 12, 2024

7 min Read

Written by Kelli Francis

Edited by Melanie Grafil

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Cryptocurrency is regularly in the news for a variety of reasons — its turbulent history, its recent strife, the emergence of crypto in 401(k) plans and interactive brokerage houses and credit cards that offer cryptocurrency rewards.

The news and sentiment on cryptocurrency vary — and so do the experiences of those who trade it. Crypto isn’t yet a well-regulated industry in the way that we’ve come to expect from more traditional forms of investing.

Although regulators are attempting to make strides on that front, it’s important to do your research about cryptocurrency exchanges, transaction options and related fees.

Types of Cryptocurrency Trading Fees

An investor can execute a wide variety of transactions on a cryptocurrency exchange, each of which comes with its own cost structure. The cost of any given crypto transaction can change regularly and on short notice — so if you’re trading cryptocurrency, you should be checking fees often. There are two types of crypto fees. Here’s a look at each.

Exchange Fees

For a cryptocurrency exchange to make money, it needs to attach to some of the financial momentum flowing through it. In most cases, that means assessing fees for common transactions, such as:

Trading
Deposits made when moving crypto to online storage spaces, like digital wallets
Withdrawals and liquidations
Loans

Network Fees

Cryptocurrency is a digital asset that, to date, is not controlled by any regulatory party, including the government. Cryptocurrency is hosted on networks and computers all over the globe and, at present, trades are made between buyer and seller, with no third-party running point.

The transaction does need to be recorded, though, so with network fees, you’re paying compensation for the resources needed to validate and record your transaction on the public blockchain.

Crypto Has Thousands of Transactions Every Hour

Bitcoin alone can average more than 13,600 transactions per hour, and unlike a stock exchange, cryptocurrency trading is available around the clock — so related fees can add up quickly.

On top of the volume associated with cryptocurrency trading, fees vary considerably, and they currently have no cap. Over the last couple of months, the daily average cost of a bitcoin transaction has ranged from less than $1 to nearly $7. However, fees surged to over $127 in April.

In this high-volume, round-the-clock marketplace with free-range fees, knowing what to expect and having a strategy for entering and exiting cryptocurrency investments will provide the best chance of capital preservation.

In the News

El Salvador has become the first country to make bitcoin into legal tender while China has banned cryptocurrency exchanges and initial coin offerings. Cryptocurrency has even made waves in the real estate industry, as a Miami-area penthouse sold in 2021 for what could potentially be a record price — $22.5 million in cryptocurrency.

How Much Are Fees for Crypto?

Most cryptocurrency exchanges charge between 0% and 1.5% per trade, depending on whether you’re a maker (buyer) or taker (seller). That means that if you’ve dedicated $1,000 to invest in crypto, the fee you’ll pay for that transaction, on average, could be anywhere from $0 to $15.

Some exchanges will charge you for cashing out your crypto investments. Others, like Coinbase, only charge for certain cash out methods.

How To Minimize Crypto Trading Fees

The impact of fees on a cryptocurrency investor’s wallet can vary widely, and not just on Bitcoin’s network. In May 2021, for example, average transaction fees on Ethereum hit an all-time high of $196.68. Fees dropped to $16.27 two days later and are currently bouncing between $1 and $7 since early June, with a spike to over $13 in early August, according to BitInfoCharts.

With fees ranging so widely, your timing and strategy for trades and other transactions really matter. Here are some tips for minimizing crypto fees.

1. Use an Exchange With Commission-Free Trading

Commission-free trading reduces your costs, but even the crypto exchanges with the lowest fees typically make up for it in other ways.

For example, Robinhood, the investing app that charges no fees on stock trades, also eliminated trading commissions, making it one of the cheapest platforms for buying crypto.

Fidelity also offers 0% commission trades for retail investors, but it charges a 1% spread on every transaction.

Some exchange transactions have lower fees or no fees for makers but do impose fees on takers. In addition, some exchanges charge spreads like the one Fidelity charges. Advanced trading options incur fees as well.

Although you’re likely to pay fees of one kind or another on most exchanges, including Coinbase and Binance.US, there are ways to avoid or minimize them — for example, Binance.US offers free trading of certain bitcoin trading pairs.

2. Buy Cryptocurrency With Coins

When you liquidate cryptocurrency into fiat — government-backed — currency, you are likely to face fees for that withdrawal and the related deposit into your digital wallet.

On the other hand, using coins to trade might be free. Consider using this strategy to reduce or eliminate your crypto fees.

3. Watch Transaction Amounts

Many cryptocurrency exchanges charge a percentage of the amount traded — meaning that if you’re executing a $10,000 trade with a 0.10% fee, you might incur a $10 fee. In some cases, a flat fee is available, but in general, the bigger your transaction, the more you’ll pay.

4. Be Strategic About Your Transaction Types

It may be that you want to exit a cryptocurrency investment, but do you need fiat currency (money backed by the government) from that trade? If not, you may be able to back out of that crypto holding with minimal fees by trading it for another cryptocurrency investment.

Some exchanges will charge you for deposits into your digital wallet, and conversion fees for moving from cryptocurrency to fiat currency may also apply.

5. Offset Crypto Fees by Taking Advantage of Promotions

Several cryptocurrency exchanges offer sign-up offers and other deals that give you access to free cryptocurrency, which will lessen the sting of fees in your portfolio balance. Here are a few examples:

Get free cryptocurrency after signing up, adding a payment method, and buying cryptocurrency at Coinbase.
Free stock offerings when you sign up from Webull or Robinhood.
Receive sign-up bonuses for completing various trading-related tasks on Phemex.

Good To Know

Cryptocurrency exchanges may not always be the only places where investors can incur crypto fees. Several brokerage houses would like to introduce cryptocurrency exchange-traded funds, and Fidelity already has.

Investors should plan to evaluate all potential fees associated with them before taking the plunge. Although ETFs typically offer a lower fee structure than other diversified investments, there are enough unknowns with cryptocurrency to warrant above-average due diligence.

Keep Crypto Fees Under Control and Maximize Your Investments

When it comes to crafting a financial strategy, investors tend to focus solely on returns. But watching what you pay for investments is just as important, if not more. Fees can take a very real bite out of your portfolio, over time.

Cryptocurrency is no exception to that rule. There’s a price to pay for trading crypto, even without a third party such as a brokerage house involved in the transaction. Online networks must be managed, trades must be documented and crypto exchanges must make money to support the role they play.

The Bottom Line

Investors interested in digital currency need to understand the potential pitfalls of a volatile marketplace that runs 24/7. As a crypto trader, your next investment decision could theoretically happen at any minute — and that, in turn, means it’s in your best interest to keep your knowledge about fees up to date.

Have a strategy for buying, selling and storing cryptocurrency, and revisit that strategy often, because new developments will continue to unfold.

Daria Uhlig contributed to the reporting for this article.

Information is accurate as of Aug. 10, 2024.

Our in-house research team and on-site financial experts work together to create content that’s accurate, impartial, and up to date. We fact-check every single statistic, quote and fact using trusted primary resources to make sure the information we provide is correct. You can learn more about GOBankingRates’ processes and standards in our editorial policy.