If you’re new to cryptocurrency, you might think that the fees charged by exchanges are a minor detail. After all, every other financial transaction involves some kind of fee, right?
But there’s actually a lot more involved than just buying and selling coins on an exchange. Let’s take a look at some of them:
Crypto activities involve different fees for trading, exchanging and doing any transaction. Traders will have to pay a fee when they buy or sell cryptocurrencies. The amount of this fee depends on the cryptocurrency pair you are dealing with, some charge high gas fees and some less.
While some exchanges don’t charge any transaction fees because they’re other revenue sources, others may charge depending on their policies and regulations set by regulators around the world.
Considering the fact that different protocols charge different fees for their services, let’s take a closer look at some of the fees we have all paid over the years.
Gas is a fee you pay for running transactions or contracts on Ethereum or any other blockchain. The more complex the contract, the more gas it takes to run it.
In the case of the Ethereum blockchain, Gas is paid in Ether and the price of gas is determined by the amount of computational power required to execute your transaction or contract.
Withdrawal and deposit fees are the most common fees you’ll encounter in cryptocurrency. A withdrawal fee is a fee charged to move your coins out of an exchange. Deposit fees are charged when someone deposits funds into an exchange’s wallet (similar to an online bank account), which is how many people use cryptocurrency exchanges these days.
Maker: The person who places an order in the order book to buy or sell a cryptocurrency at a specific price.
Taker: The person who places an order in the order book to buy or sell a cryptocurrency at the best available price.
Staking is a way of earning interest on your crypto holdings. In this process, you can lock up your coins for a set period of time and receive dividends in return. The more coins you stake, the more you will earn in interest payments.
Different platforms charge different rates and have different fee structures. Make sure you know what they are before choosing an exchange.
The rates and fees vary from platform to platform. Some charge a flat rate for all transactions, while others have different rates for buying and selling cryptocurrencies.
:LCX charges 0.3% on all buys and sells but if you use LCX Token then it comes down to 0.15% .
In conclusion, it is important to know the different fees that you will be charged for trading on an exchange. Different platforms charge different rates and have different fee structures. Make sure you know what they are before choosing an exchange.
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