Did you notice that you bought a coin for $5, for example, and then you immediately noticed that it dropped to $4.60? What happened?! And why, even though you used the free currency transfer option and not the spot trading that imposes trading fees.
First thing, what happened to you is normal and many people face it when buying cryptocurrencies right after depositing.
And the reason
1- The difference between the purchase price and the market price (Spread)
Even if the platform says there are no fees, the commission is often hidden in the price difference.
Example: You buy a coin for $5, but if you try to sell it immediately, you find that its actual value in the market is $4.60. This difference is the platform's profit and is called the spread.
2- Liquidity and price volatility
Some coins have low trading volume or their prices move quickly. Therefore, you might buy at a certain price and after seconds the price drops, making it seem like you are losing.
3- Type of product (spot trading vs transfer)
- In spot trading, you pay a clear and small commission (for example, 0.1%) but the price is very close to the market.
- In the fast transfer or what platforms call "no fees", you are given a worse price than the market price, and this is an indirect way to take the commission.
Example:
The actual market price is $4.80.
The platform offers you a price of $5.00 and says no fees.
As soon as you buy and think about selling, you find that the value is between $4.60 and $4.80, and this is the realistic price.
