If you're already diving into cryptocurrency, sooner or later you come across the question: what are these fees, why do they go up and down, and how to not get burned by them?
Let’s break it down.
Types of fees in crypto:
1. Transaction fees (Gas fees)
This is the fee for conducting a transaction on the blockchain. For example, in Ethereum — the fee for 'gas'. The busier the blockchain, the higher the fee. Imagine it's like a traffic jam — if you want to go faster, pay more.
2. Exchange fees
When you buy or sell crypto on an exchange (for example, Binance), you pay a small percentage of the transaction. Usually 0.1-0.2%, but there can be discounts — if you pay with exchange tokens or trade large volumes.
3. Withdrawal fees
Transferring from the exchange to an external wallet or back also costs money. This is not always a fixed amount and depends on the crypto and the current network load.
4. Hidden fees and spreads
Sometimes the difference between the buying and selling price is also a kind of fee, especially on less liquid pairs.
How to reduce expenses and not burn money on fees?
• Choose the right time. Network fees depend on the load. If you have a flexible schedule — wait for the network to 'cool down'.
• Use alternative networks. For example, Binance Smart Chain or Layer 2 solutions for Ethereum (Arbitrum, Optimism). There the fees are significantly lower.
• Buy larger amounts, but less frequently. Frequent small trades are more expensive in total than one large trade.
• Keep an eye on promotions and discounts on the exchange. Binance often reduces fees if you use their token BNB for payment.
• Plan your withdrawals. If you need to withdraw crypto, it’s better to accumulate an amount to avoid losing on frequent small fees.