{"id":26547,"date":"2022-05-16T13:50:22","date_gmt":"2022-05-16T17:50:22","guid":{"rendered":"https:\/\/www.moneysense.ca\/?p=262357"},"modified":"2022-05-16T13:50:22","modified_gmt":"2022-05-16T17:50:22","slug":"crypto-trading-fees-are-you-paying-too-much","status":"publish","type":"post","link":"https:\/\/www.moneysense.ca\/save\/investing\/crypto\/crypto-trading-fees-are-you-paying-too-much\/","title":{"rendered":"Crypto trading fees: Are you paying too much?"},"content":{"rendered":"
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Trading fees may escape your attention if you\u2019re eager to dive into the crypto market and just want to get started. But fees are a guaranteed expense, so why not reduce the costs<\/a> as much as possible to increase your net gains? We\u2019ll explain the different kinds of fees\u2014including the ones that aren\u2019t so obvious\u2014and how you can save money by choosing your trading platform carefully.<\/p>\n

How trading fees affect your crypto purchases<\/h2>\n

Fees may have a bigger impact on your trading activities than you think. Let\u2019s say a crypto trading platform advertises a fee of 1%\u2014if you buy $100 worth of bitcoin or another cryptocurrency<\/a>, you\u2019ll get $99 worth of crypto.<\/p>\n

Sounds straightforward\u2014but that may not be the only cost. Crypto trading platforms use varying terms to describe their fees. For example, that 1% fee might be called a trading fee or a trading commission; others apply a spread on the buy and sell price; and others may charge both. Before you trade, it\u2019s best to find out the total price, not just the fee advertised.<\/p>\n

Types of crypto fees: trading, deposit, withdrawal, staking and network fees<\/h2>\n

Here are the different types of crypto trading fees to be aware of:<\/p>\n

1. Trading fee, commission or spread<\/h3>\n

The trading fee is the total you pay to buy and sell cryptocurrencies using Canadian dollars. This fee varies from about 0.10% to over 4% per transaction, depending on several factors\u2014most importantly the platform\u2019s fee structure and your payment method. Credit and debit card purchases tend to be more expensive, while purchases funded by e-transfers and wire transfers tend to be free or have low additional costs.<\/p>\n

Some platforms charge a standard percentage of each buy or sell transaction, while others may apply a spread to the bid and ask prices, a quick-buy fee or some other markup cost. A spread is expressed in basis points (bps), with 100 bps equalling 1 percentage point. So, if your trading platform applies a spread of, say, 125 bps, it means you\u2019ll pay a fee of $1.25 on a $100 transaction (1.25%). This may not seem significant for a $100 purchase, but it translates to a fee of $125 on a $10,000 purchase.<\/p>\n

What about platforms that say they don\u2019t charge a commission\u2014does that mean trading is free? Likely not. Instead of taking a commission, these platforms might charge a spread or a quick-buy fee, as explained above. Do your due diligence and find out if your platform has markups by reading the fine print in your account signup agreement and the fees section of your platform\u2019s website.<\/p>\n

2. Deposit and withdrawal fees<\/h3>\n

The deposit fee is what you\u2019ll pay to transfer dollars from your bank account into your trading account, and the withdrawal fee is what you\u2019ll pay to transfer dollars from your trading account to your bank account. To encourage the use of their platform, crypto exchanges typically don\u2019t charge a deposit fee; however, for dollar withdrawals to your bank account, you may be charged a flat fee or a percentage.<\/p>\n

Source<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Trading fees may escape your attention if you\u2019re eager to dive into the crypto market and just want to get started. But fees are a guaranteed expense, so why not reduce the costs as...<\/p>\n","protected":false},"author":1,"featured_media":26549,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":[],"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[7,10],"tags":[],"_links":{"self":[{"href":"https:\/\/blog.andrewwbradley.ca\/index.php\/wp-json\/wp\/v2\/posts\/26547"}],"collection":[{"href":"https:\/\/blog.andrewwbradley.ca\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.andrewwbradley.ca\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.andrewwbradley.ca\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.andrewwbradley.ca\/index.php\/wp-json\/wp\/v2\/comments?post=26547"}],"version-history":[{"count":0,"href":"https:\/\/blog.andrewwbradley.ca\/index.php\/wp-json\/wp\/v2\/posts\/26547\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blog.andrewwbradley.ca\/index.php\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/blog.andrewwbradley.ca\/index.php\/wp-json\/wp\/v2\/media?parent=26547"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.andrewwbradley.ca\/index.php\/wp-json\/wp\/v2\/categories?post=26547"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.andrewwbradley.ca\/index.php\/wp-json\/wp\/v2\/tags?post=26547"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}