Is It Better to Transfer Coins to Exchanges Now or Later?

[Juxoz]

For most of us who are holding coins outside of centralized exchanges, is it sound to transfer the coins to exchanges now or in spring 2025?

The reasoning behind my question is, right now the prices might have gone up relative to the past two years, but if the cycle continues and prices pump by mid next year, at that point, if we transfer the coins to exchanges, wouldn't those transfers incur more fees than if we transfer now when the prices hopefully are cheaper relative to mid next year?

For instance, if I have 1,000 BTC (one can dream, can't it?) and transfer all to CEX abc, and the network fees is 0.5% in Dec 2024, that translates to 1,000 x $100,000 x 0.5% = $500,000, as opposed as to, say, Nov 2025 when the price had gone up to $200,000, and the network congestion can drive the fees higher, where the same transfer might cost the user 1,000 x $200,000 x 0.8% =  $1,600,00.

Of course, I'm talking about transferring to "safer", well known, long running CEXes, and not any run of the mill/"come-let-me-scam-you" CEX. My lean on this idea is that, even if these large CEXes, such as Coinbase, end up failing, it won't happen during the crypto season such as 2021 or 2017. If anything, they'd start failing a year after that (2026) -- long after the cold hard cash has been withdrawn.

UPDATE: After reading some of the comments below, and the reasoning provided, I think I'll keep all my tokens in self-custody wallets for time being. Early in summer 2025 for some, and late in summer 2025 for others, I'll revisit this decision.

Thanks all.

[Odusko]

Depends on the condition of the network at that time, if the network is congested and gas fees high it means you gonna pay more to send your coins from your wallet to your preferred exchange, in most times, network is always congested whenever there is a bull market so take note of that also, although not advicesable to store your coins on centralized exchange for long period of time because of the risks that comes with using an exchange wallets, nit your key, not your coins.

Question you should ask before sending your coins to an exchange against the year ahead is:

1: what happened if the coin you have stored in the exchange become delisted before 2025 at the time you want to exchange them?

2: what happens in the case of exchange exit scam, such as FTX and the rest of the other exchange that got users coins stocked?

All of the above is the reason why we most often advice against exchange wallets storage, for long term, better to pay fees than losing your entire coins.

[Zaguru12]

For most of us who are holding coins outside of centralized exchanges, is it sound to transfer the coins to exchanges now or in spring 2025?

The reasoning behind my question is, right now the prices might have gone up relative to the past two years, but if the cycle continues and prices pump by mid next year, at that point, if we transfer the coins to exchanges, wouldn't those transfers incur more fees than if we transfer now when the prices hopefully are cheaper relative to mid next year?

As long as you are not selling your coins now do not risk sending it to any exchange and leaving it there in the wallet because the risk of leaving off your coins on exchanges is there. Transaction fees are not always high to scare you this early to exchanges

For instance, if I have 1,000 BTC (one can dream, can't it?) and transfer all to CEX abc, and the network fees is 0.5% in Dec 2024, that translates to 1,000 x $100,000 x 0.5% = $500,000, as opposed as to, say, Nov 2025 when the price had gone up to $200,000, and the network congestion can drive the fees higher, where the same transfer might cost the user 1,000 x $200,000 x 0.8% =  $1,600,00.

This is not how transaction fees work, it is not in percentage or even fixed  as you put it out, the transaction fee is based on how congested the network is and the network is not frequently high although we do sometimes experience high fees during congestion period but it is not always. What you should rather do now of you feel the fees are extremely low now is to consolidate your little inputs into one so that when you want to move out later it won’t have high fees.

Of course, I'm talking about transferring to "safer", well known, long running CEXes, and not any run of the mill/"come-let-me-scam-you" CEX. My lean on this idea is that, even if these large CEXes, such as Coinbase, end up failing, it won't happen during the crypto season such as 2021 or 2017. If anything, they'd start failing a year after that (2026) -- long after the cold hard cash has been withdrawn.

There is absolutely no perfect timing for collapse of exchanges or anything else it can can be hacked which is something that doesn’t have a season to happen, you can also have your account suspended too so there is no need to trust any exchange no matter how huge it is. You can though split your funds in different exchanges if you really want to move them as such you don’t have everything on one exchange

[Juxoz]

Depends on the condition of the network at that time, if the network is congested and gas fees high it means you gonna pay more to send your coins from your wallet to your preferred exchange, in most times, network is always congested whenever there is a bull market so take note of that also, although not advicesable to store your coins on centralized exchange for long period of time because of the risks that comes with using an exchange wallets, nit your key, not your coins.

Question you should ask before sending your coins to an exchange against the year ahead is:

1: what happened if the coin you have stored in the exchange become delisted before 2025 at the time you want to exchange them?

2: what happens in the case of exchange exit scam, such as FTX and the rest of the other exchange that got users coins stocked?

All of the above is the reason why we most often advice against exchange wallets storage, for long term, better to pay fees than losing your entire coins.

Thanks for proposing those questions... for (1), wouldn't the exchange announce ahead of time that they are delisting it, and therefore, giving the consumers enough time to transfer to another exchange or back to their wallets?

For (2), I'm not worried about that, because CEXes I'll be using are on the safe side of the industry. And as I mentioned, almost all the scummy institutions/exchanges get demolished during the down time; same as in regular market. I am not dwelling on that.

This is not how transaction fees work, it is not in percentage or even fixed  as you put it out, the transaction fee is based on how congested the network is and the network is not frequently high although we do sometimes experience high fees during congestion period but it is not always. What you should rather do now of you feel the fees are extremely low now is to consolidate your little inputs into one so that when you want to move out later it won’t have high fees.

You are correct. Maybe I should have used the following example:

Fee in BTC: 250 bytes×20 satoshis/byte=5000 satoshis=0.00005 BTC.
Fee in USD (assuming 1 BTC = $30,000): 0.00005 BTC×30,000 USD/BTC=1.5 USD.

vs.

Fee in BTC: 250 bytes×40 satoshis/byte=10000 satoshis=0.0001 BTC.
Fee in USD (assuming 1 BTC = $200,000): 0.0001 BTC×200,000 USD/BTC=20 USD.

There is absolutely no perfect timing for collapse of exchanges or anything else it can can be hacked which is something that doesn’t have a season to happen, you can also have your account suspended too so there is no need to trust any exchange no matter how huge it is. You can though split your funds in different exchanges if you really want to move them as such you don’t have everything on one exchange

The hacking part is a valid point, but what is the probability of this happening to even a small percentage of accounts at the top CEXes? I am talking about Coinbase, Kraken, Gemini, etc.

Another great point you brought is the account suspension. But then again, can't that happen if I transfer coins now vs. 6 months down the road?

And as far as splitting funds... sure if I had $5 mil, I would have done that, but the primary reason I am going for a single CEX is that they have the lowest exchange fees for almost all the coins (except one). I don't mind the extra book keeping and tax arrangements once they are sold; the primary goal is to reduce the fees by selecting the lowest fee.

[moderator's note: consecutive posts merged]

[passwordnow]

Thanks for proposing those questions... for (1), wouldn't the exchange announce ahead of time that they are delisting it, and therefore, giving the consumers enough time to transfer to another exchange or back to their wallets?

Yeah, they announce delistings and they give every user that has that coin that's about to get delisted ahead of time so that they can move their funds or sell it asap.

For (2), I'm not worried about that, because CEXes I'll be using are on the safe side of the industry. And as I mentioned, almost all the scummy institutions/exchanges get demolished during the down time; same as in regular market. I am not dwelling on that.

You can't be sure with that. Even the most reputable ones can have some bad days and you'll never know how bad and terrible the situation they can get in.
Just remember FTX, Binance has got hacked with huge funds and recall all of those big names in the industry in the past.

[o48o]

For most of us who are holding coins outside of centralized exchanges, is it sound to transfer the coins to exchanges now or in spring 2025?

The reasoning behind my question is, right now the prices might have gone up relative to the past two years, but if the cycle continues and prices pump by mid next year, at that point, if we transfer the coins to exchanges, wouldn't those transfers incur more fees than if we transfer now when the prices hopefully are cheaper relative to mid next year?

For instance, if I have 1,000 BTC (one can dream, can't it?) and transfer all to CEX abc, and the network fees is 0.5% in Dec 2024, that translates to 1,000 x $100,000 x 0.5% = $500,000, as opposed as to, say, Nov 2025 when the price had gone up to $200,000, and the network congestion can drive the fees higher, where the same transfer might cost the user 1,000 x $200,000 x 0.8% =  $1,600,00.

Of course, I'm talking about transferring to "safer", well known, long running CEXes, and not any run of the mill/"come-let-me-scam-you" CEX. My lean on this idea is that, even if these large CEXes, such as Coinbase, end up failing, it won't happen during the crypto season such as 2021 or 2017. If anything, they'd start failing a year after that (2026) -- long after the cold hard cash has been withdrawn.

Fees change so much daily that if you want to send them later on, you are better off just waiting for a moment that fees are down. There's no way no one would know in terms of fees, which option is cheaper.



But talking about safety: if exchanges like coinbase would end up failing, i am pretty sure that those fees don't matter any more. Because places as legit as coinbase failing, would mean that something horrible has happened and value of that btc would be tanked overnight so much, and that point selling it would be just covering your losses.

[dunfida]

For most of us who are holding coins outside of centralized exchanges, is it sound to transfer the coins to exchanges now or in spring 2025?

The reasoning behind my question is, right now the prices might have gone up relative to the past two years, but if the cycle continues and prices pump by mid next year, at that point, if we transfer the coins to exchanges, wouldn't those transfers incur more fees than if we transfer now when the prices hopefully are cheaper relative to mid next year?

For instance, if I have 1,000 BTC (one can dream, can't it?) and transfer all to CEX abc, and the network fees is 0.5% in Dec 2024, that translates to 1,000 x $100,000 x 0.5% = $500,000, as opposed as to, say, Nov 2025 when the price had gone up to $200,000, and the network congestion can drive the fees higher, where the same transfer might cost the user 1,000 x $200,000 x 0.8% =  $1,600,00.

Of course, I'm talking about transferring to "safer", well known, long running CEXes, and not any run of the mill/"come-let-me-scam-you" CEX. My lean on this idea is that, even if these large CEXes, such as Coinbase, end up failing, it won't happen during the crypto season such as 2021 or 2017. If anything, they'd start failing a year after that (2026) -- long after the cold hard cash has been withdrawn.

If you are making up some direct transfers from your non-custodial wallet into those exchange platform then the fee will always vary on the network condition and since we are talking about Bitcoin then you can check out anytime on mempool.space, as long it isnt clogged or having those spam in the network then you can transfer up even multi millions of USD value of bitcoin with having that less than a dollar fee amount and that what makes crypto to be the best on making up some transfers on different location with having that very minimal or almost free kind of fee which is totally opposite on what we do have in bank transfers and other traditional methods or ways.

In regarding about passing it up then it will be wise that you shouldnt be that parking out those coins into exchangers on which potential hack and issues can raise or happen anytime and if it happens that you do make these CEX to be your main wallet then recovery of those funds will really be that hard just in case if it happens. We do always have that common saying "Not your keys, Not your coins" .. Always stick into this principle then you will really be just that fine. If we do speak or talks about long term holds or accumulation then nothing beats out with non custodial wallet like Electrum on which this is im trusting up all over the years.

[pooya87]

You are correct. Maybe I should have used the following example:

Fee in BTC: 250 bytes×20 satoshis/byte=5000 satoshis=0.00005 BTC.
Fee in USD (assuming 1 BTC = $30,000): 0.00005 BTC×30,000 USD/BTC=1.5 USD.

vs.

Fee in BTC: 250 bytes×40 satoshis/byte=10000 satoshis=0.0001 BTC.
Fee in USD (assuming 1 BTC = $200,000): 0.0001 BTC×200,000 USD/BTC=20 USD.

Using your 1000 BTC example in OP, do you really care about $18.5 more free when your $30 mil investment has turned into $200 million?

But kidding aside this is a matter of pros and cons and also your objectives.
Moving coins to a CEX while fees are low will help you pay less sats but you are taking additional risks from being hacked to the exchange running away.

It is also affected by your objective.
As a regular trader you should already have coins on exchange and actively trading. It should not be a matter of "deposit if price goes up".
As a long term investor you should have made enough profit to not care about higher fees. And not being a trader in this scenario means you shouldn't take those risks.

[TastyChillySauce00]

you should only be concerned about fee if you hold BTC or ETH, as for the other blockchains? not so much because even at worst time, they'd only require few cents as a network fee, also even if you transfer it right now, big fat chance the fee required will be the same amount in BTC, and once price sky rocketed, your fee deduction will be the same.

maybe the only problem here is if somehow the fee spike up because everyone is moving their crypto in the middle of massive rally, but it depends, since in BTC you'll be charged more or less the same fee whether you send 0.0001 BTC or 10 BTC, if your capital is too low, maybe it's the right time to send it to exchange, but if your capital is high, you shouldn't care.

[DiMarxist]

I will not advise you to transfer your coins from self custodial wallets to centralized exchange unless you want to sell the coins at the moment then you can send it to the exchange. But if you are keeping it for a long time then you can keep in the self custodial wallets. There are many disadvantages of keeping of coins in the exchange. Freezing of coins/account blockage, bitcoin transaction feenis not much so you can make a transaction at anytime and Ethereum transaction fee now is 2$ so they are noy much.
That is my advice but if you like to keep your coins in exchange because of the fear of the future high fee. I will say don't.

[Juxoz]

You can't be sure with that. Even the most reputable ones can have some bad days and you'll never know how bad and terrible the situation they can get in.
Just remember FTX, Binance has got hacked with huge funds and recall all of those big names in the industry in the past.

FTX went down a year after the heights of 2021. The vast majority of hacks don't happen at major exchanges, and if they do, it'll impact a very small portion of their accounts. It's all about statistics and probabilities. I'm more concerned about these exchanges locking your account than getting hacked (as another user pointed out).

But talking about safety: if exchanges like coinbase would end up failing, i am pretty sure that those fees don't matter any more. Because places as legit as coinbase failing, would mean that something horrible has happened and value of that btc would be tanked overnight so much, and that point selling it would be just covering your losses.

Do you know of reliable sites that can display network fees for different tokens, and if not, how one can find that out?

Coinbase, which I'm not a big fan of, goes down, it'll be because of something like what FTX was doing. And if so, whatever deity you pray you, help us all.

you should only be concerned about fee if you hold BTC or ETH, as for the other blockchains? not so much because even at worst time, they'd only require few cents as a network fee, also even if you transfer it right now, big fat chance the fee required will be the same amount in BTC, and once price sky rocketed, your fee deduction will be the same.

maybe the only problem here is if somehow the fee spike up because everyone is moving their crypto in the middle of massive rally, but it depends, since in BTC you'll be charged more or less the same fee whether you send 0.0001 BTC or 10 BTC, if your capital is too low, maybe it's the right time to send it to exchange, but if your capital is high, you shouldn't care.

A few tokens that I hold, I know their fees were relatively low back in 2022. Are there sites for most top 50 or 100 tokens that specify their daily gas fees?

[moderator's note: consecutive posts merged]

[pawanjain]

For most of us who are holding coins outside of centralized exchanges, is it sound to transfer the coins to exchanges now or in spring 2025?

The reasoning behind my question is, right now the prices might have gone up relative to the past two years, but if the cycle continues and prices pump by mid next year, at that point, if we transfer the coins to exchanges, wouldn't those transfers incur more fees than if we transfer now when the prices hopefully are cheaper relative to mid next year?

For instance, if I have 1,000 BTC (one can dream, can't it?) and transfer all to CEX abc, and the network fees is 0.5% in Dec 2024, that translates to 1,000 x $100,000 x 0.5% = $500,000, as opposed as to, say, Nov 2025 when the price had gone up to $200,000, and the network congestion can drive the fees higher, where the same transfer might cost the user 1,000 x $200,000 x 0.8% =  $1,600,00.

Of course, I'm talking about transferring to "safer", well known, long running CEXes, and not any run of the mill/"come-let-me-scam-you" CEX. My lean on this idea is that, even if these large CEXes, such as Coinbase, end up failing, it won't happen during the crypto season such as 2021 or 2017. If anything, they'd start failing a year after that (2026) -- long after the cold hard cash has been withdrawn.

Don't even think of it. Transferring your coins now and holding them on an exchange just because you think the network congestion might increase and can cause you some additional fees would be foolishness.
What if the exchange gets hacked or does an exit scam ?
Wouldn't it be better to keep holding in your non-custodial wallet and then transfer it later when you actually want to exchange the coins.

[markm]

Yeah send them only if you are going to place them for sale, that is, build up your column of sell offers or buy offers with it.

No point putting anything on an exchange if not placing it for sale or placing it as buy-side offers for something else, even if you place it way out of reach of where you imagine the price might go at least there it will be able to catch a black or white swan event you didn't imagine possible instead of just sitting at risk without doing anything by being there.

In my thinking the only reason to hold stuff on an exchange without actually being in an offer would be if for example you are seriously concerned that its price might skyrocket far above your highest imagined value of it leaving you out in the cold if you placed it for sale and price skyrockets way way above the price you placed it at.

In such a case I'd just go ahead and place it astronomically high, super duper astronomically high, hundreds even maybe of times higher than I imagine it could ever go, rather than just sit it there doing nothing yet being at risk just by being there.


-MarkM-

[Trebor123]

For most of us who are holding coins outside of centralized exchanges, is it sound to transfer the coins to exchanges now or in spring 2025?

The reasoning behind my question is, right now the prices might have gone up relative to the past two years, but if the cycle continues and prices pump by mid next year, at that point, if we transfer the coins to exchanges, wouldn't those transfers incur more fees than if we transfer now when the prices hopefully are cheaper relative to mid next year?

For instance, if I have 1,000 BTC (one can dream, can't it?) and transfer all to CEX abc, and the network fees is 0.5% in Dec 2024, that translates to 1,000 x $100,000 x 0.5% = $500,000, as opposed as to, say, Nov 2025 when the price had gone up to $200,000, and the network congestion can drive the fees higher, where the same transfer might cost the user 1,000 x $200,000 x 0.8% =  $1,600,00.

Of course, I'm talking about transferring to "safer", well known, long running CEXes, and not any run of the mill/"come-let-me-scam-you" CEX. My lean on this idea is that, even if these large CEXes, such as Coinbase, end up failing, it won't happen during the crypto season such as 2021 or 2017. If anything, they'd start failing a year after that (2026) -- long after the cold hard cash has been withdrawn.

No way would I be holding anything on an exchange for longer than absolutely necessary . You have to consider the risk rather than any gain you might make.
If you lost all your holdings because the exchange collapsed or was frozen  that small gain you might have have made will mean nothing.
Don't make any assumptions about the safety of any exchange, in a bull or bear market. In a bull market prices are higher so more reward for rug pulls! People assume their investments are safe on Coinbase for example. Really? You trust everything they're telling us. The only thing I trust is my cold wallet and even those are not 100%! Look at it as the costs of security! 😉

[Coyster]

Fees should not be your concern over safety, better to have your coins safe and incur a few extra dollars in fees, than trying to save fees and lose your assets when an exchange is hacked or when they decide to seize your coins for God knows why.

Of course, I'm talking about transferring to "safer", well known, long running CEXes, and not any run of the mill/"come-let-me-scam-you" CEX.

It does not matter the exchange it is, be it "well known" or "long running", keep your assets in your non custodial wallet and only send to an exchange when you are ready to sell.

[pooya87]

Coinbase, which I'm not a big fan of, goes down, it'll be because of something like what FTX was doing. And if so, whatever deity you pray you, help us all.

Why?

Coinbase may look big but it is not big enough to have as significant an effect as MtGox had on the price.
Checking https://coinmarketcap.com/rankings/exchanges/ we can see that out of the total $127.58 billion daily volume only 2% of it or $2.6 is coming from coinbase! Only 2%. MtGox back in 2013 had more than 85% of the total daily volume.

If a CEX with 2% of the total daily volume goes down, it will have a small impact like FTX. A temporary hiccup... not the end of the world

[Botnake]

Maybe you got the wrong information about how fees are calculated. Let me tell you, it’s not safe to transfer your Bitcoin to a CEX if you plan to hold it there. It’s just not advisable because without your keys, it’s not your Bitcoin. You risk losing it. Even though some exchanges claim they have insurance, what happens if they lose everything or pull an exit scam? Consider all those possibilities before moving your Bitcoin based on that belief.

If you’re worried about high fees, don't mind it as its not a problem, they’re not as high as you might think.

This would prove it...
Bitfinex moves $1.1 billion in Bitcoin for less than a dollar

[Dr.Bitcoin_Strange]

Well, like every other valid response you have got here, you also no know that even at the time that you fear that transaction fee would spike, it might not necessarily spike above what you can handle and you also need to know that it's better to play safe rather risk to lose all your asset just because of common transaction fee.

Although we are not praying for bad things to happen but at least crypto enthusiast have already learned the dangers of holding coins on a centralized exchange due to the cases of other exchange that got hacked and collapsed.

[o48o]

Maybe you got the wrong information about how fees are calculated. Let me tell you, it’s not safe to transfer your Bitcoin to a CEX if you plan to hold it there. It’s just not advisable because without your keys, it’s not your Bitcoin. You risk losing it. Even though some exchanges claim they have insurance, what happens if they lose everything or pull an exit scam? Consider all those possibilities before moving your Bitcoin based on that belief.

If you’re worried about high fees, don't mind it as its not a problem, they’re not as high as you might think.

This would prove it...
Bitfinex moves $1.1 billion in Bitcoin for less than a dollar

I am not sure if that cheap tx value in dollars is even relevant when it comes to $1.1 Billion worth of BTC.

Because just 0.1% percent change in BTC price during the transaction, would mean that send amount would be worth $1.1 Million dollar more or less when it arrived. With -1% it goes to $11 Million more or less.

[passwordnow]

You can't be sure with that. Even the most reputable ones can have some bad days and you'll never know how bad and terrible the situation they can get in.
Just remember FTX, Binance has got hacked with huge funds and recall all of those big names in the industry in the past.

FTX went down a year after the heights of 2021. The vast majority of hacks don't happen at major exchanges, and if they do, it'll impact a very small portion of their accounts. It's all about statistics and probabilities. I'm more concerned about these exchanges locking your account than getting hacked (as another user pointed out).

The possibility is there on locking their user's account if you don't have much documentation on your funds. So, not just with the additional identity they are going to ask but also likely the source of funds and where it came from. If you can't provide any other documents from it and you'll just reason out as another holding of yours, it is up to them to decide to lock your account but they'll for sure going to release your money and won't let you use them again.