Withdraw from exchange straight away or at a threshold

[clifjw]

Hi,

I've just bought my first BTC with Binance. Just a small amount. I intend to buy about £10-£15 a week, then when I see big drops in the rate I'll buy larger one off sums.

My question to any others buying the same smaller amounts, do you wait until you hit a self decided amount (say £50) then withdraw to cold storage? I'm mindful of multiple fees from transferring it after every small purchase on the exchange. I know its a risk leaving money on the exchange but I figure risk of loss up to £50 with a reputable exchange like Binance is acceptable to save on transfer fees.

Any differing opinions on this from your traders / HODLers?

Many thanks

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[OmegaStarScream]

My question to any others buying the same smaller amounts, do you wait until you hit a self decided amount (say £50) then withdraw to cold storage? I'm mindful of multiple fees from transferring it after every small purchase on the exchange. I know its a risk leaving money on the exchange but I figure risk of loss up to £50 with a reputable exchange like Binance is acceptable to save on transfer fees.

I guess it would be fine to keep small amounts but why not just use a decentralized P2P exchange like LocalCryptos instead and get your funds directly deposited to your cold storage?

[RickDeckard]

Hi,

I've just bought my first BTC with Binance. Just a small amount. I intend to buy about £10-£15 a week, then when I see big drops in the rate I'll buy larger one off sums.

My question to any others buying the same smaller amounts, do you wait until you hit a self decided amount (say £50) then withdraw to cold storage? I'm mindful of multiple fees from transferring it after every small purchase on the exchange. I know its a risk leaving money on the exchange but I figure risk of loss up to £50 with a reputable exchange like Binance is acceptable to save on transfer fees.

Any differing opinions on this from your traders / HODLers?

Many thanks

I think this depends on the amount of trust you have in the exchange. Do you not trust it well enough? set a low treshold and then transfer to a cold wallet.

I've used Binance in the past and it still holds up pretty well today and it's a reputable exchange but the moto still applies - you don't the keys, they are not your coins. I think that what might affect your decision are the fees associated with your investment. Just make a basic excel file with a simulation with all the transactions that you will be making in a year (example), and all the fees that you would be subject to in each transaction. Then you simulate different thresholds and again apply another fee to them.

Sum that all up and you'll have at least a year worth of data that may facilitate your decision regarding that field. There's no right answer to your question since it depends on the individual.

[clifjw]

...why not just use a decentralized P2P exchange like LocalCryptos instead and get your funds directly deposited to your cold storage?

To be honest, since I'm still new to it I was was a bit nervous about using a p2p system like that. LocalBitcoins has been suggested to me, but I understand that is still centralised and you still have to pay a fee to transfer from that. What security does LocalCryptos offer a buyer? Reading their site it simply said "Once the seller confirms payment, crypto is released from escrow to the buyer" but doesn't that rely on the seller being genuine?

[RickDeckard]

...why not just use a decentralized P2P exchange like LocalCryptos instead and get your funds directly deposited to your cold storage?

To be honest, since I'm still new to it I was was a bit nervous about using a p2p system like that. LocalBitcoins has been suggested to me, but I understand that is still centralised and you still have to pay a fee to transfer from that. What security does LocalCryptos offer a buyer? Reading their site it simply said "Once the seller confirms payment, crypto is released from escrow to the buyer" but doesn't that rely on the seller being genuine?

The whole process is pretty secure. The escrow isn't a middleman or something like that, just thin of it as a temporary "bank account" that hold the sellers assets. If you see an offer that suits your price point you just send an offer to the seller which in turns evaluates it. If indeed it accepts the offer he gets the money and you get the equivalent crypto in your wallet.

Remember that, as a buyer, you should never send money to the seller before he/she deposits money on the escrow account. If the seller tries to run away with your money (by denying that you ever sent it in the first place) you can just raise a dispute with him. An external agent will then check the deal ( verify exchanges, see the conversation , etc) and the crypto/money is returned to whoever is right.

As always, try to make a deal with a reputable seller with a > 99 % positive feedback

[Little Mouse]

Since the amount is small, I think you can take the risk as you are not holding a sum which may ruin your future. Or. you can use this forum also. For example, you can buy USDT on the exchange and look for an exchange here in the currency section board.

[NeuroticFish]

I know its a risk leaving money on the exchange but I figure risk of loss up to £50 with a reputable exchange like Binance is acceptable to save on transfer fees.

Imho even 200-300 GBP is OK to be kept there, the risk is not that big.
Exchanges are unsafe, yes, but not *that* unsafe.
People are emphasising that money has to be withdrawn from the exchanges because some keep amounts like tens of thousands, or entire bitcoins there (and not even trading).

You should really keep an eye on the withdrawal minimum amounts and fees for the exchange you want to use.
Since you mentioned Binance, from what I see on their fee list, minimum amount to withdraw is now 0.001 BTC (30 GBP) and the fee is half of it = 0.0005 BTC (15 GBP).
So no matter what we say, you'll basically have to keep the money in there longer, else you'll spend far too much on fees.

Edit: fixed typo

[stompix]

I'm mindful of multiple fees from transferring it after every small purchase on the exchange. I know its a risk leaving money on the exchange but I figure risk of loss up to £50 with a reputable exchange like Binance is acceptable to save on transfer fees.

It will all come down to how much you plan on buying and how often, from the start, the withdrawing of £15 is out of the question since that's the fee Binance charges, so if you plan on buying BTC worth £20 you end up with £5, so I'll say that's just as bad an as a hack.
LE:
As NeuroticFish corrected me, this extreme scenario will not be possible so the worse case is indeed paying 50% max.

Raising the sum a bit to see a better picture, if your plan is to buy £100 every week and do so for 3 months then you know for certain two things
- in worst case scenario you lose £600
- you go the safe way but pay each week £15, and you end up with minus £180 for sure.

I guess it would be fine to keep small amounts but why not just use a decentralized P2P exchange like LocalCryptos instead and get your funds directly deposited to your cold storage?

If you look at local crypto for the UK the only nonnewbie guy selling small amounts (under £100) the best offer comes from a guy that sells BTC with a 20% premium. You end up with the same fees in the end, way better to look for an ATM with 5-10% in fees and deal with that alone.
 

[Ryushin]

I don't think the withdrawal fee of Bitcoin from binance exchange is that high like Ethereum right now, bitcoin withdrawal fee is still more cheaper than ETH, it's better and safer to withdraw your bitcoin to a private crypto wallet that you have control over

[NeuroticFish]

the withdrawing of £15 is out of the question since that's the fee Binance charges, so if you plan on buying BTC worth £20 you end up with £5, so I'll say that's just as bad an as a hack.

You've missed from your calculation the fact that Binance's minimum allowed amount is 0.001 BTC (30 GBP)  

I don't think the withdrawal fee of Bitcoin from binance exchange is that high like Ethereum right now, bitcoin withdrawal fee is still more cheaper than ETH, it's better and safer to withdraw your bitcoin to a private crypto wallet that you have control over

Just look at the fees from the link from my previous post. You'll be surprised.

[sujonali1819]

If you are ask me then I will say it's good to hold money in exchange for a while if the balance is small amount and there is a possibility to make another deposit very soon like one or todays after. In this case if you withdraw your fund at the first stage where your 50% fund will be deducted as withdrawal fees. Then  you should wait till next deposit and withdraw along with first and second deposit.

And don't keep hold your fund in any exchange for a long period even it's big or too small.

[bitadelco]

Binance is a large and reputable exchange so as others have mentioned, you can likely wait and aggregate up to the amount you're comfortable with having on an exchange before initiating transfer so you don't needlessly incur too many fees. I can't recall if Binance requires 2FA (2 factor authorization) but if it doesn't then make sure you have that in place and it's with a reputable authenticator app (not a text message with a code).

Another thing to think about besides the potential for a hack is access in general. Sometimes these exchanges get overloaded when the price of bitcoin moves a lot in either direction.

Kudos to you though for ultimately taking self custody of your own bitcoin!

[OcTradism]

Ok right. You already have your account on Binance and your account already has Bitcoin so let's click on the Wallet, Overview, and Withdrawal. Type in BTC ticker in the search box. You will see the withdrawal fee that is 0.0005 BTC and this amount equals to $20.49. It is not a small fee especially if compares it to the amount of bitcoin you buy each time and the total amount you have in your account.

Not your keys, not your coins, as the saying goes. It is very correct but because of your balance, and Binance is a big, reputable exchange so I think you can leave your bitcoin on Binance for a while. When you have enough BTC to reduce the % of withdrawal fee per total BTC you have, make your withdrawal.

Binance got hacked in the past and they spent compensation for customers from their exchange fund. You can trust them, somewhat.

[pooya87]

You should also consider both the withdrawal fee and the transaction fee you will end up paying later in your own wallet due to having many inputs to spend.

For example when you buy £10 at this current price you receive 0.00033460 bitcoin, usually exchanges charge high withdrawal fees so it would eat up into what you bought real fast. Additionally when you receive all these small inputs in your wallet and later wanted to spend a bigger amount like 0.01BTC then you will have to spend about 30 of them which means your transaction ends up being a little less than 30 times bigger than usual transactions with 1 input.
But if you increase it to a higher value (like the min withdrawal or higher like 0.005) then you will end up paying a lot less fee when trying to spend the inputs.

[KaratX]

It depends on the amount of the asset, I only leave behind 100$ worth of assets on exchange either for trading purpose or others, anything over 100$ I will withdraw instantly into my wallet address, I don't know when a hack will happen, it's better to leave what you can afford to lose on exchanges

[clifjw]

Thanks very much everyone for the replies. Whilst I knew withdrawal fees would factor, I hadn't considered that they would be that much. Presumably it's a static fee and doesn't multiply based on how much you are withdrawing so I'm happy enough to leave up to £100 maybe a little more on it I think.

Aside from localcryptos and localbitcoins, do you have any other suggestions for reputable places to buy from that don't have high withdrawl fees, or for decentralised p2p have good security for both buyer and seller? Where are the preferred non-exchange places to buy from?

[CryptopreneurBrainboss]

Although you question has been answered perfectly by the responders above me, I still want to bring in another view that can help you withdraw those small amount of your funds to your cold wallet. You can use some Peer2peer exchange that offer you bitcoin in returns for your alts

That's you buy alts with the bitcoin and trade them for bitcoin by withdrawing them from binance and exchange them for bitcoin. This isn't that complicated to execute and some alts have very low fees that won't cost much even though you were to save all your bitcoin and withdraw then one time. Some alts also has almost zero or zero withdrawal fees.

If you're not in a rush though to get your coins off exchanges, the suggestion above is the most preferable. But don't let your coins exceed high amount as exchange aren't safe for storing coins.

[hatshepsut93]

You should look for some method that allows you to withdraw your coins via Lightning Network. You'll need to withdraw some small amount as usual, open a channel and after that you should be able to withdraw without fees. I never tried it myself, because I don't have access to a lot of exchange, but in theory this should work well. Bitfinex supports Lightning Network, some other exchanges too, maybe there are some p2p options.

[OmegaStarScream]

Thanks very much everyone for the replies. Whilst I knew withdrawal fees would factor, I hadn't considered that they would be that much. Presumably it's a static fee and doesn't multiply based on how much you are withdrawing so I'm happy enough to leave up to £100 maybe a little more on it I think.

Aside from localcryptos and localbitcoins, do you have any other suggestions for reputable places to buy from that don't have high withdrawl fees, or for decentralised p2p have good security for both buyer and seller? Where are the preferred non-exchange places to buy from?

You've got Holdhodl[1] and Bisq[2] as well but unlike the two others you mentioned, liquidity can be an issue. You can also try to install Mycelium[3] and look for some traders in your local area.

[1] https://hodlhodl.com/
[2] https://bisq.network/
[3] https://mycelium.com/lt/help.html

[blckhawk]

My question to any others buying the same smaller amounts, do you wait until you hit a self decided amount (say £50) then withdraw to cold storage? I'm mindful of multiple fees from transferring it after every small purchase on the exchange. I know its a risk leaving money on the exchange but I figure risk of loss up to £50 with a reputable exchange like Binance is acceptable to save on transfer fees.

It was true that storing your coins on an exchange is not recommended, however, I think it would be fine because it's just a small amount just like you have said, if you keep withdrawing it even if it is a small amount the fees might kill you especially that fees today was extraordinarily expensive. So yeah I think you'll be fine leaving it there for a moment then you can withdraw it to your wallet if you accumulate enough. Besides, the exchanges you have been using were Binance and we know how reputable that is.