When using altcoin exchanges, it is important to understand the various fees associated with cryptocurrency trading. Below are common fees you may encounter:
1. Trading fees
Maker fees: These fees are incurred when you place a new order (but the new order does not immediately match with existing orders) to increase the order book liquidity. Maker fees are usually lower than taker fees and are designed to encourage market makers.
Taker fees: These fees are charged when your order matches with an existing order on the order book, thereby removing liquidity from the market. Taker fees are usually higher than maker fees. Specific rates vary by exchange and depend on your trading volume.
2. Withdrawal fees:
Cryptocurrency withdrawal fees: When you transfer cryptocurrency from an exchange to a personal wallet, withdrawal fees may apply. These fees depend on the type of cryptocurrency you are withdrawing and the exchange's policies. Some exchanges have fixed withdrawal fees, while others calculate them based on network transaction fees.
3. Deposit fees:
Cryptocurrency deposit fees: Some exchanges charge fees for depositing cryptocurrency into your exchange account. Fees may vary based on the cryptocurrency and the exchange's policies.
4. Conversion fees:
Trading pair fees: If you trade between different cryptocurrencies (e.g., Bitcoin to Ethereum), you may encounter conversion fees. These fees are usually expressed as a percentage of the transaction amount.
5. Margin trading fees
Interest rates: If you engage in margin trading (borrowing funds for leveraged trading), you may need to pay interest or financing fees on the borrowed amount. These interest rates may vary by exchange and specific trading pair.
6. Inactivity fees
Account maintenance: If your account remains inactive for an extended period, some exchanges may charge an inactivity fee. To avoid these fees, you must log in regularly and perform trades or other account activities (if required by the exchange).
7. VIP or tiered fee structure
Volume-based discounts: Many altcoin exchanges offer tiered fee structures based on your trading volume over a specific period. The higher the volume, the lower the fees, which is very beneficial for active traders.
