What are the ideal trading fees and withdrawal fees for a crypto exchange?

[nonlogs]

What do you guys think? I have seen many exchanges offering different fee structures, and some give discounts for coin staking or VIP membership. What do you think is an ideal trading fee and withdrawal fee structure for a new exchange?

[Oshosondy]

You can see the fee on each exchanges.

For sport trading, the fee is. between 0.075% to $0.01% on the exchanges that I am using. On derivative, the fee is between $0.02% for market marker and $0.045% to 0.05% for market takers. Options has slightly lower fee than the perpetual future.

For withdrawal fee, go and check the exchanges because there are countless numbers of coins. But the main determinant is comparing your withdrawal fee with miners fee and add little amount on it as your gain.

[Upgrade00]

The range will be a bit wide depending on the cryptocurrency being traded. An ideal fee will be less than 0.1%, it can go much lower if the exchange is new and wants to be competitive and attract new users. They can revise this at a later time depending on results.

Decentralized exchanges also usually have a higher fee rate than CEXes do, for that slightly above 0.1% could be acceptable.

[OmegaStarScream]

I suggest looking into this list: https://withdrawalfees.com/coins

I'm not sure when it was last updated, but it should give you an idea on the withdrawal fees for the different coins and on multiple exchanges. If you're comparing the top exchanges (OKX, Bitget, Bybit, Binance, Crypto.com etc.) then most of the time you're not going to find a really significant difference. It's pretty competitive.

[PX-Z]

Trading fees typically range between 0.01% to 0.1%, depending on the platform and the specific cryptocurrency being traded. The same applies to withdrawal fees, which can vary significantly based on the coin and network congestion sometimes when its too congested, exchanges adjusted and make announcement on it.

Here's a list of crypto exchanges fees comparison guides for your reference.

[logfiles]

Here is another website that compares trading fees of different exchanges (disclaimer: I am not sure how regularly updated it is, but it should give you an idea of the ideal trading fee range)
1. https://exchangewar.info/

You could also just pick up about 5 top exchanges and manually check the trading and withdrawal fees. The information is readily available in help articles of different exchanges.

[joniboini]

I think it depends on a lot of things. Competition is just one of them. For example, how much capital do they have when they start the business? How much margin is required to make a decent profit? How's the market condition? Is there any feature that is significantly liked by people that can offset aggressive pricing? Etc. "Ideal" itself can mean so many things too, from making as much profit as possible in a short time frame to sell it to another owner later down the line, to something completely idealistic like making privacy accessible to everyone.

[BenCodie]

Trading fees (like others mentioned) can range anywhere between 0.01% and 1.00% on most CEXs and DEXs, and generally between 0.5% to 2% on swaps (sometimes more), though what should be paid attention to is spread. Some exchanges might offer as low as 0.01%, though their deviation from the actual spot price might be anywhere between 0.5 - 5%.

0.5% including slippage, spread and fees is what I'd consider ideal for trading fees. For withdrawal fees, I think that the exact network fee is fair (no more and no less). Any exchange charging more than the network fee is greedy (most CEXs are) considering how much they make from other revenue sources.

[EarnOnVictor]

What do you guys think? I have seen many exchanges offering different fee structures, and some give discounts for coin staking or VIP membership. What do you think is an ideal trading fee and withdrawal fee structure for a new exchange?

Unfortunately, it's a business for exchanges, after all, they are unjust reapers that want to use every means to harvest people of their money. If not, why can't exchanges charge the on-charge transaction fees only? Well, it takes one exchange to start, and we need more competition in the industry to achieve this.

It's annoying to see, at times, the mempool fee for Bitcoin at under $0.5, but exchanges charging $20 and above. That's extortion.

[joniboini]

Unfortunately, it's a business for exchanges, after all, they are unjust reapers that want to use every means to harvest people of their money. If not, why can't exchanges charge the on-charge transaction fees only? Well, it takes one exchange to start, and we need more competition in the industry to achieve this.

Are you suggesting they don't take profits from processing withdrawals? I'm not sure how the economics work, but there's a chance that taking fees from your trading activity won't be enough to cover their cost. If anything, they'll just increase the fees from that and some people will feel discouraged from using them if they do that. Not trying to defend them though, I do agree that charging ridiculous fees is unacceptable, especially if the network isn't busy at all.

[nonlogs]

What do you guys think? I have seen many exchanges offering different fee structures, and some give discounts for coin staking or VIP membership. What do you think is an ideal trading fee and withdrawal fee structure for a new exchange?

Unfortunately, it's a business for exchanges, after all, they are unjust reapers that want to use every means to harvest people of their money. If not, why can't exchanges charge the on-charge transaction fees only? Well, it takes one exchange to start, and we need more competition in the industry to achieve this.

It's annoying to see, at times, the mempool fee for Bitcoin at under $0.5, but exchanges charging $20 and above. That's extortion.

I think most exchanges use a hot wallet. When you deposit, you're actually sending Bitcoin to a temporary wallet, and then the exchange transfers it from there to their hot wallet this transfer incurs a transaction fee. Almost all CEXs do this, so they recover that cost by charging a fee at the time of withdrawal.

[nonlogs]

Unfortunately, it's a business for exchanges, after all, they are unjust reapers that want to use every means to harvest people of their money. If not, why can't exchanges charge the on-charge transaction fees only? Well, it takes one exchange to start, and we need more competition in the industry to achieve this.

Are you suggesting they don't take profits from processing withdrawals? I'm not sure how the economics work, but there's a chance that taking fees from your trading activity won't be enough to cover their cost. If anything, they'll just increase the fees from that and some people will feel discouraged from using them if they do that. Not trying to defend them though, I do agree that charging ridiculous fees is unacceptable, especially if the network isn't busy at all.

I'm thinking of implementing a deposit transaction fee (to cover the cost of transferring Bitcoin from the temporary wallet to the hot wallet) so that I don’t have to charge a high withdrawal fee. I’m considering a $1 + gas fee model. That would mean:

Deposit Fee: $0 + gas fee
Withdrawal Fee: $1 + gas fee

[EarnOnVictor]

Unfortunately, it's a business for exchanges, after all, they are unjust reapers that want to use every means to harvest people of their money. If not, why can't exchanges charge the on-charge transaction fees only? Well, it takes one exchange to start, and we need more competition in the industry to achieve this.

Are you suggesting they don't take profits from processing withdrawals? I'm not sure how the economics work, but there's a chance that taking fees from your trading activity won't be enough to cover their cost. If anything, they'll just increase the fees from that and some people will feel discouraged from using them if they do that. Not trying to defend them though, I do agree that charging ridiculous fees is unacceptable, especially if the network isn't busy at all.

One of the issues people have is that they do not even know what is right for them, so how would they fight it if they had the opportunity?

Mind you, exchange is not the first to come into the world of the financial market, we've seen traditional brokers for years, and even now, all the traditional brokers I know are charging exactly the blockchain fees, so why should that of exchanges be different? Mind you again, moving out my money is different from their core business model, they are just using that to cheat people. And if you don't know, with the current business model of exchanges, they gain in everything possible being done on their platform and even cheap people with their bucket chop bot and the likes of them. What else do they want? No wonder their CEOs always become billionaires in the very year they have huge customers.

[shield132]

I think most exchanges use a hot wallet. When you deposit, you're actually sending Bitcoin to a temporary wallet, and then the exchange transfers it from there to their hot wallet this transfer incurs a transaction fee. Almost all CEXs do this, so they recover that cost by charging a fee at the time of withdrawal.

Many people use CEXs to deposit money, convert it into fiat and later withdraw. I think they do not cover that cost by charging a high withdrawal fee, they cover that money by commission that they take from each trade and sometimes, they take a loss from certain users who don't trade but it doesn't matter much for them because fees collected from big traders, who trade very often, is enough to not care about very small loss.

Btw ideal trading and withdrawal fees are the lowest ones, the lower the better. I'd personally be a huge fan of an exchange that will let me to set custom fee on transactions or at least let me to choose among 3 options, slow, medium and fast confirmation.