Crypto exchanges charging for inactive accounts . Do you support this ?

[krishnaverma]

There is a new practice among crypto exchanges to charge its users if they are inactive on the exchange. Some f the examples are

1) Zebpay: It is an Indian exchange that charges some fees from users if they have not done any trade in any month. It is still having this rule on the platform.

2)Bitstamp: Another exchange which added this rule was Bitstamp. It planned to charge 10 euros ($10.27) per month for inactive accounts.

Personally, I am against these charges and it affects the rate of crypto adoption. It discourages people from starting to use crypto. What is your opinion about this practice ?

[Baofeng]

There is a new practice among crypto exchanges to charge its users if they are inactive on the exchange. Some f the examples are

1) Zebpay: It is an Indian exchange that charges some fees from users if they have not done any trade in any month. It is still having this rule on the platform.

Just posting here their official statement:



https://twitter.com/zebpay/status/1347525568468697093?lang=en

2)Bitstamp: Another exchange which added this rule was Bitstamp. It planned to charge 10 euros ($10.27) per month for inactive accounts.

However, Bitstamp have a change of heart,

We are no longer implementing this fee.  

After listening to our community’s response, we’ve changed course. There will be no inactivity fee.

Our goal has always been to be a secure and reliable trading platform that provides industry-leading services, and we do not intend to deviate from this path.

All our customers can continue to use and enjoy all our services regardless of the balance of your accounts and time passed from your previous activities.

We apologize for the inconvenience this might have caused.

https://blog.bitstamp.net/post/bitstamp-cancels-plans-to-charge-inactivity-fee/

Personally, I a against these charges and it affects the rate of crypto adoption. It discourages people from starting to use crypto. What is your opinion about this practice ?

Of course, who wouldn't want to get charge for just letting your coins stay in their exchange.

But it just put a emphasize to our old adage here, "Not your keys, not your coins". So it's better to just withdraw your crypto to any exchange, regardless if you are very active (just leave enough for trading purpose), or not that active. Because there are possibility that exchanges can be hacked, or they will simply freeze your accounts for no reasons at all. And then there are exchanges that exit scams too. Or worst this, way back in 2018 QuadrigaCX: $190 million locked after founder died in December 2018.

[OmegaStarScream]

I personally think that more exchanges should adopt this as long as users don't get charged when they have nothing on their accounts because it seems like something that would encourage users from keeping their funds in off exchanges.

[hosseinimr93]

Personally, I a against these charges and it affects the rate of crypto adoption. It discourages people from starting to use crypto. What is your opinion about this practice ?

I don't think that's bad.
It encourages people to withdraw their funds from the exchanges and keep them in their own (non-custodial) wallets.
Why should users keep their coins on exchanges if they don't want to trade? Exchanges shouldn't be used as wallets.

[Hyphen(-)]

There is a new practice among crypto exchanges to charge its users if they are inactive on the exchange. Some f the examples are

1) Zebpay: It is an Indian exchange that charges some fees from users if they have not done any trade in any month. It is still having this rule on the platform.

2)Bitstamp: Another exchange which added this rule was Bitstamp. It planned to charge 10 euros ($10.27) per month for inactive accounts.

Why should you pay for not being active or maintaining a cryptocurrency exchange that may one day expose you to risk by disclosing your personal information when you can be your own bank?
Because privacy is essential, it is always best to use a personal wallet that will not charge you for not being active or may charge you for maintenance; and you will be in control of your cryptos because you have your private keys saved in your custody.
A friendly suggestion is to withdraw all of your coins to a personal wallet where you will have control over your private key and no one will charge you for inactivity or maintenance.

Personally, I a against these charges and it affects the rate of crypto adoption. It discourages people from starting to use crypto. What is your opinion about this practice ?

I don't believe it is necessary to use a crypto exchange before adopting Bitcoin or cryptocurrency, which is why it is critical to have adequate knowledge about the entire thing; there are crypto exchanges that do not require KYC before starting trading with them, so why not buy your crypto/Bitcoin from them and then send it to your personal wallets if you don't want to use local P2P transactions?
People must understand the importance of privacy and should avoid such exchanges because they will discourage people who are unfamiliar with cryptocurrency from adopting it.

I personally think that more exchanges should adopt this as long as users don't get charged when they have nothing on their accounts because it seems like something that would encourage users from keeping their funds in exchanges.

This policy should instead discourage users from using such exchanges and encourage them to move all of their coins to personal wallets.

[davis196]

Personally, I a against these charges and it affects the rate of crypto adoption. It discourages people from starting to use crypto. What is your opinion about this practice ?

I'm also against such "inactive account" charges, but I don't think that this would have any impact over the global crypto adoption.
Only a few crypto exchanges have such policies and I'm sure that they will change their Terms of Service, in order to keep their customers.
Imagine having a bank account and your bank suddenly starts charging you 100 USD per month only because you haven't used your bank account in one month. This seems really sketchy. The crypto industry is competitive enough and such sketchy business tricks will not be tolerated.

[hosseinimr93]

Imagine having a bank account and your bank suddenly starts charging you 100 USD per month only because you haven't used your bank account in one month.

You don't have any option other than using centralized services like banks for holding your fiat. When it comes to cryptocurrencies, you have the option to keep your coins in your own non-custodial wallets and be your own bank.
Exchanges have been created for trading cryptocurrencies, not for holding them and it's normal that they want to make profit.

[stompix]

There is a new practice among crypto exchanges to charge its users if they are inactive on the exchange.

It's nothing new, Bitstamp tried to start charging this half a year ago, but there are others who have done this for a long time, let me quote my post from May 2020 when some were outage that Latoken will be doing this:

They did, latoken is not the only one:

coindirect
https://www.coindirect.com/terms

You must not use your Digital Currency Wallet for the purpose of storing Digital Currency. Where any Digital Currency in your Digital Currency Wallet is not used for a period exceeding 90 (ninety) days, Coindirect may charge and obtain from you an Inactivity Fee of EUR 5.00 per month (or the equivalent in your Local Currency), which shall be collected from the Digital Currency held in your Digital Currency Wallet.

coinsbank
https://coinsbank.com/fees

Inactive account maintenance
49.95 EUR (or equivalent) per month

crypto.com

Inactivity fee 12 months  5£

And.......drumbeats....

Bitfinex
https://www.bitfinex.com/legal/terms

9. Inactivity Fee: Where you have not traded on the Site or engaged in any funding activity on the Site for an uninterrupted period of one year, Bitfinex thereafter reserves the right to charge and obtain from you an inactivity fee of $5.00 per month, with or without notice to you.

But as I said before, nobody reads the terms!

Personally, I am against these charges and it affects the rate of crypto adoption. It discourages people from starting to use crypto.

Hmm, let me get this right, a fee for inactivity is discouring people from actively using crypto?
This is like an extra tax on unused office space would discourage owners to rent it.  

It's actually encouraging people to stop using exchanges are wallets and stop leaving all their coins on an a CEX that might get hacked or "hacked" and thus lose all their money.

[Despairo]

This is the reason why you need to avoid all of centralized exchanges and use P2P trading or decentralized exchange, too many things that make me prefer to choose P2P and decentralized exchange rather than centralized exchange.

I can't say anything about this centralized exchange rule, they're just want to take an advantage of inactive accounts to generate more money. It's not a red flag or the exchange is scam, because anything has been explained on their terms of service. Actually before you create a new account, you're already agree with their terms of service.

[Rruchi man]

I read a similar topic on the gambling section about gambling platforms charging users for inactivity in their gambling account, maybe that idea originated from observing crypto exchanges.

There is a new practice among crypto exchanges to charge its users if they are inactive on the exchange.

Perhaps the reason is because they spend extra reserving that space for you on their server or to encourage you to trade or take your money to a wallet if you won't trade with it.

If you are not comfortable with the practice, you can use another trading services that has not yet taken up that practice of charges for inactivity.

[mk4]

1. If your goal is to actually "use" bitcoin/crypto, you most likely wouldn't have it on an exchange
2. Leaving funds on exchanges if you aren't trading them isn't a smart move in the first place
3. Just stop using such exchanges if you're not a fan of inactivity fees and let them feel the damage

[krishnaverma]

1. If your goal is to actually "use" bitcoin/crypto, you most likely wouldn't have it on an exchange

There can be other reasons to keep it on exchange like doing future trading, buying NFTs on an exchange and then trading it and so on.

2. Leaving funds on exchanges if you aren't trading them isn't a smart move in the first place

You will still need an account on an exchange to buy crypto before sending to own device. The point is now some exchanges are charging for this which I think is not cool.

3. Just stop using such exchanges if you're not a fan of inactivity fees and let them feel the damage

Is this practical ? Where you buy new crypto coins from then ?

[mk4]

There can be other reasons to keep it on exchange like doing future trading, buying NFTs on an exchange and then trading it and so on.

If that's what you mean by "using" crypto, then sure. If you want to actually "use" crypto, you'd be using trustless and non-custodial platforms.

You will still need an account on an exchange to buy crypto before sending to own device. The point is now some exchanges are charging for this which I think is not cool.

Can't charge you if you don't leave funds on the exchange in the first place!

Is this practical ? Where you buy new crypto coins from then ?

On other exchanges that don't charge inactivity fees?

[KingsDen]

This is one of the best implementation by exchanges that I have seen online. If this is true, it is purely commendable by the exchanges.

The campaign of not your keys not your coin is indirectly being supported by exchanges. This will be an awakening call to make us understand that it is not ideal to leave our coins in and exchange for a very long period of time
It is a campaign in favour of crypto adoption and not against as opined by Op.

[o_e_l_e_o]

The point is now some exchanges are charging for this which I think is not cool.

It's obviously just to make more profits. Once they've set up a wallet to receive coins, and then received coins to that wallet, there is no additional cost of maintenance. What are they charging for exactly? Not unlocking the wallet and not making any transactions?

But I don't care if they want to charge this ridiculous fee. The more reasons to turn people off from using centralized exchanges, the better.

Is this practical ? Where you buy new crypto coins from then ?

Peer to peer via platforms such as Bisq, AgoraDesk, RoboSats, or even the currency exchange board on this forum. You can't be charged a fee by a centralized platform if you don't use one. Not to mention all the privacy and security benefits of not having to hand control of your coins or your personal data over to third parties.

[tvplus006]

There is a new practice among crypto exchanges to charge its users if they are inactive on the exchange...

Thus, cryptocurrency exchanges will be able to transfer the remaining funds from accounts that are not used for various reasons, on a "legal" basis to their wallet. In fact, such actions by the cryptocurrency exchange should be regarded as theft.

[DaveF]

I can also see it happening more on larger / regulated / insured exchanges.

If they have some form of insurance I can see there being a charge to them by the insurance company for the number of accounts not just active ones along with the amount covered. Along with the possibility of other fees. Same if they have their customer service as an external company that charges per number of customers. They don't just care about the number of people who DO call but the amount that CAN call.

Kind of like the FAA requires 1 flight attendant per 50 SEATS on an aircraft, not per 50 passengers. Have 210 seats, you need 5 flight attendants, does not matter if you only sold 9 tickets for the flight and only 8 of them showed up you have 5 attendants working.

So if other places are billing the exchange like that then they are just passing the costs along, and probably adding a lot for even more profit.

-Dave

[NeuroticFish]

Personally, I am against these charges and it affects the rate of crypto adoption. It discourages people from starting to use crypto. What is your opinion about this practice ?

I find it interesting. I think that those exchanges do/will have an exodus of accounts (and funds) and a liquidity drop too.
At least it helps people keep their money in their own wallets (at least I hope so).

On the other hands, it can cause an even more centralization of users in the few bigger and more active exchanges, which also don't have this kind of fees.
Unfortunately I don't expect many CEX users opt for DEX, not yet. But maybe soon enough...

[o_e_l_e_o]

I can also see it happening more on larger / regulated / insured exchanges.

Given that exchange insurance only protects against the exchange themselves being hacked, and not against individual accounts being hacked, then the insurance provider should really be charging based on the value of assets the exchange holds rather than the absolute number of accounts. I take the point regarding customer service, but no customer service provider anywhere is charging $10 per month per account, so obviously most of the charge is just pure profiteering by the exchange as you rightly point out.

Unfortunately I don't expect many CEX users opt for DEX, not yet. But maybe soon enough...

The more that centralized exchanges pull stuff like this, then the stronger the argument for DEXs become. Already DEXs win hands down on security of your coins, on security of your data, on privacy and not selling your information, on fees, on not being hacked, on not scamming their users, on not being fractional reserve, on not freezing accounts or seizing coins, speed of setting up an account, not requiring KYC, the list goes on. The only thing CEXs have going for them is the speed of individual trades, but continue to alienate users and that one metric becomes less and less important.

[rat03gopoh]

I think I heard about one of the exchanges enacting this policy a few years ago.
The policy doesn't specify inactive accounts. I just imagine if that includes accounts with empty balances, if users arrive back a few months later and it will deduct their deposit according to the period of inactivity.