1. How are transaction fees calculated?

Core formula: Transaction fee = Opening value fee rate + Closing value fee rate

  • Opening/Closing value = Contract quantity * Opening/Closing price

  • Fee rate: Depends on whether you are placing a 'Limit order' or a 'Market order'.

For example:
Assuming you use 10,000 USDT as margin and open a full contract with 20 times leverage (i.e., your position value is 200,000 USDT), and the Bitcoin price is 50,000 USDT.

scenario 1: Both sides are market orders (the most expensive situation)

  • You are in a hurry to open a position and directly clicked the 'Buy' button, this is a market order (Taker), with a fee rate of 0.05%.

  • Opening fee = 200,000 USDT * 0.05% = 10 USDT

  • When closing, you also chose to close with a market order, again taking a fee, with a rate of 0.05%.

  • Closing fee = 200,000 USDT * 0.05% = 10 USDT

  • Total fee = 10 + 10 = 20 USDT

Scenario 2: Opening a limit order, closing with a taker (common situation)

  • If you are not in a hurry and set a limit order, for example, buying at 49,500, and it gets executed. This is a limit order (Maker), with a rate of 0.02%.

  • Opening fee = 200,000 USDT * 0.02% = 4 USDT

  • When closing, the market is volatile, and you used a market order to close, which is a taker, with a rate of 0.05%.

  • Closing fee = 200,000 USDT * 0.05% = 10 USDT

  • Total fee = 4 + 10 = 14 USDT

Scenario 3: Both sides are limit orders (the most economical situation)

  • When opening a position, a limit order (maker) was used, and the fee was 4 USDT.

  • When closing, you also set a limit order to close (for example, selling at 51,000 to close a long position), and it was executed. This is also a limit order, with a rate of 0.02%.

  • Closing fee = 200,000 USDT * 0.02% = 4 USDT

  • Total fee = 4 + 4 = 8 USDT

Conclusion at a glance:
For a transaction of 200,000 USDT, the difference between the highest and lowest fees is 12 USDT. For high-frequency traders, this accumulation of fees is extremely surprising.

2. How to effectively reduce trading fees?

The core idea of reducing fees boils down to two points: 1) Become a maker as much as possible; 2) Obtain fee discounts wherever possible.

1. In trading behavior: Be a 'maker'

  • Use limit orders (Limit Order): This is the most important and effective method. Do not easily use market orders (Market Order). Plan your entry and exit points in advance, and use limit orders to wait for execution. Although you may miss some opportunities, the fees saved in the long run are quite considerable.

  • Provide liquidity: If your limit order is not immediately executed but remains on the order book waiting for others to take it, you are providing liquidity to the market and thus enjoy a lower (or even negative) Maker fee.

2. On asset holding: Hold BNB and pay fees

  • Use BNB to pay fees: Binance provides the option to use its platform token BNB to pay fees, and you can enjoy a 25% discount (this discount rate may change, please refer to the latest announcement on the official website).

  • Calculate Discounts:

    • Assuming you originally needed to pay a fee of 10 USDT for a transaction.

    • Using BNB for payment, the discounted amount is: 10 USDT * (1 - 0.25) = 7.5 USDT (equivalent in BNB).


  • Note: You need to enable the option 'Use BNB to pay fees' on the BN [Fee Page] first.

3. Account level: Upgrade your VIP level to obtain lower rates

Binance's fees are not fixed; the larger the trading volume and the more positions held, the lower the fees. Even for small traders, there are opportunities to upgrade!

  • Look at trading volume: The trading volume over the past 30 days has reached a certain scale.

  • Look at asset volume: Hold a certain amount of BNB or other designated coins (such as BTC, ETH).

  • How to check: On the Binance official website, find the [Fee Rate] page, where you can see the fee requirements and specific discounts from ordinary users to VIP 9.

    • For example: VIP 1 (30 days trading volume ≥ 150 BTC or holding 25 BNB)Contract Maker fee rate drops from 0.02% to 0.016%,Taker fee rate drops from 0.05% to 0.040%. The fee is directly discounted by 20%!


4. Participate in activities: Utilize the referral cashback program

  • For example, if you use 10,000 USDT to open a contract with 20x leverage, that equals 10,000 USDT * 20 = 200,000 USDT, and then the fee would be 200,000 USDT * rate 0.0005 = 100 USDT. If there is a fee reduction, it can be refunded = 40 USDT in fees.

    Summary and Suggestions
    For your case of playing contracts with 10,000 USDT, the optimal strategy is:

  1. Preferred: Insist on using limit orders (makers) for opening and closing positions, keeping the fee firmly at 0.02%.

  2. Essential: Hold some BNB and enable the 'Use BNB to pay fees' feature to immediately enjoy a 25% discount. This results in an actual fee of only 0.015% (Maker) and 0.0375% (Taker).

  3. Advanced: Work hard to increase trading volume or hold BNB assets to challengeVIP 1level, to further reduce the fee rate on top of the discount.

Remember, in high-risk and high-volatility contract trading, the fee is the only certain and controllable cost. Effectively managing it can greatly improve your long-term profitability and survival chances.

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