A Discussion On How Much It Costs to Buy Cryptocurrency At Exchanges? – Part 1

The Price Of Bitcoin On The Exchanges 

The relevant question is what does it cost to trade bitcoin? Here it is answered that apart from the price of bitcoin itself, each of the cryptocurrency exchanges adds a fee for trading when customers purchase and sell coins. Therefore, these fees include Maker that add to the order book liquidity through limit orders fees as well as in some cases, cryptocurrency traders can incur maker as well as trader fees, and if the limit order is there already present in that order book.

Hence cryptocurrency exchanges come to be mainly calculating fees in two ways that are a flat fee per trade or as a percentage of the 30-day trading volume for an account. Thereby in both cases, they’ve adopted a tiered structure that depends on the amount being traded. 

What Are The Important Things To Consider While Trading On Cryptocurrency Exchanges?

Here come four important things which the traders must consider while also purchasing the crypto. 

It is first that the cryptocurrency exchanges are unregulated in most jurisdictions as the regulators in the countries around the world have therefore taken a hands-off approach to cryptocurrency regulation in some of its biggest trading markets. Thereby, for example, cryptocurrency exchanges are governed by a patchwork of regulations in the United States which is among the largest markets for cryptocurrency trading. Therefore, some types of cryptocurrency trading are banned in China as it has accounted for as much as 90% of overall trading. Thereby the prominent Chinese exchanges are still operational and have simply shifted base to Seychelles or Malta since the government crackdown. 

For the second reason, the fee schedules that the cryptocurrency exchanges here are designed to encourage frequent trading in large transaction amounts worth thousands of dollars. Thereafter these fees often decrease with an increase in the amount and frequency of trades. It is therefore as such small as well as infrequent orders which do not be cost-efficient at cryptocurrency exchanges.

To count the third one the exchanges, encourage trading with coins as the fiat currencies generally incur deposit as well as withdrawal fees at exchanges depending on the payment mode whereas purchasing the cryptos with other coins, for the most part, comes to be free. Therefore, in some cases which is a small fee charged to set up a wallet for the required cryptocurrency

Finally, the fourth and the last one is most well-known cryptocurrency exchanges do not offer access to all coins while in many cases traders are often seen to transfer funds from one wallet to the other and have the fund with their trading accounts using either those fiat currencies or cryptocurrencies. Here it is noted that for example traders that are wishing to buy Cardano a top 15 cryptocurrency by market cap are not currently able to do so directly on the popular Coinbase exchange. It is here that however, traders can use the fiat currency to purchase bitcoin at Coinbase. Hence Binance another exchange has already offered users the facility to import coins from other wallets as once they have bitcoin in their Binance account they can use it to buy it listed on the exchange. Hereby the transfer between multiple wallets at different exchanges incurs small charges at each end. 

Following this is a brief comparison of the trading fees for bitcoin which is at the current list of most popular exchanges by trade volume as this comparison does not consider margin and leverage fees.

HCoin

In the case of the Seychelles based HCoin, it comes as one of the newest entrants into the crypto exchange field as of January 2020. The fact that I was launched in August 2018 while ti offers customers the opportunity to trade in a list of cryptocurrencies and fiat currencies that include popular ones like bitcoin, ether, XRP, Litecoin, bitcoin cash, EOS, USDT, and HKDT amongst many others. 

Thereafter HCoins fees are being seen as dependent on the base currency as well as volume and are listed in a chart on the website of the exchange, thereafter it is observed that the company does not appear to list any fees for funding an account through the transfer of digital assets from another wallet as it is not clear whether the transaction fees can change depending upon the size of each trade. 

The Continuation In The Next Post

The discussion further follows to the next post as it has the account of several coins trading on the crypto exchanges. Hence, we bring you more details in the next writeup