Why Exchange Fees Are Important? Which Exchange Is Best?

Why Trading Fees Are Important For EVERYONE?

Understanding exchange fees is crucial for anyone diving into cryptocurrency trading. These fees can significantly impact your profitability and trading strategies. it does not matter if you are a trader with portfolio of 500$ or $10,000 anyone should pay attention to fees.

Exchange fees are the charges imposed by cryptocurrency exchanges for executing trades. They typically fall into a two categories

• Maker-Taker Fees: Differentiates between makers (who add liquidity) and takers (who remove liquidity). Makers often enjoy lower fees, while takers pay more for immediate execution.

• Flat Fees: Simple and predictable, these charge a fixed amount per transaction.

Examples From 3 Exchanges: Binance, Bybit and BingX

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Binance

Spot: Maker Fee: 0.100%

Taker Fee: 0.100%                            

Futures: Maker Fee: 0.020%                            

             Taker Fee: 0.050% Funding Rate: 0.0100% Interest Rate: 0.0100%                    

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Bybit (our fees are a little smaller but original fee is displayed below our fee)

Spot: Maker Fee: 0.100%                            

          Taker Fee: 0.180%                            

Futures: Maker Fee: 0.036%                            

              Taker Fee: 0.100% Funding Rate: 0.0080% Interest Rate:  0.0300%                           

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BingX (our fees are a little smaller but original fee is displayed below our fee)

Spot: Maker Fee: 0.100%                            

          Taker Fee: 0.100%                             Futures: Maker Fee: 0.020%                            

              Taker Fee: 0.050%  Funding Rate: 0.0097% Interest Rate: 0.0000%                            

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We have decided to evaluate three exchanges that we personally use by comparing their fees using both theoretical and real-life examples.

1) Theoretical Example: We open a MATIC/USDT position with a 500 USDT margin and 20x leverage, resulting in a position size of $10,000. After 72 hours (3 days), we close the position with a 100% profit, gaining 500 USDT.

Considering that we will be opening and closing positions at market prices, we have used taker fees for our examples. Interestingly, both Binance and Bybit charge interest fees, which are not favorable for mid-term traders (those holding trades for up to a week or two). From our example, we can see that Bybit has the highest fees, Binance comes in second, and BingX has the lowest fees.

2) Practical Example: We have decided to take the exchange with the highest fees and the one with the lowest fees for our examples. After extensive trading on Bybit, which we have used for a significant period, we recently transitioned to BingX due to its more competitive fee structure.

BYBIT Exchange

Example 1: IO/USDT / 15x leverage / 16.37% Position was closed within 24 hours. Total profit was 446.27 USDT where total fees were 55.836 USDT.

Example 2: IO/USDT / 10x leverage / 48.80% Position was closed within 24 hours. Total profit was 1,464 USDT where total fees were 42.164 USDT. However, we found it interesting that Bybit sometimes engages in liquidity manipulations to increase the fees they collect, which, in turn, increases the losses traders incur. An example of this can be seen in the video below, where we took a position on RAYDIUM/USDT.

Here we can see clearly that our loss that we closed the position with was 92$ and as soon as we closed the position we checked and our PLN was $149 where total fees were 24$. What actually happened was that we had a manipulative movement which resulted in additional loss of 33$. This example is just one out of many that we tested on Bybit exchange BingX Exchange

Example 1: PEOPLE/USDT / 20x leverage / 75.66% Position was closed within 24 hours. Total profit was 1,217 USDT where total fees were 24.26 USDT. We had 3 different zones where we took profit which means that our fees were bigger than if we would close fully the position.

Example 2

Example 2: IO/USDT / 20x leverage / 105.95% Position was closed within 24 hours. Total profit was 337.69 USDT where total fees were 7.26 USDT.

Conclusion Throughout our theoretical examples, we found that Bybit has the highest fees, particularly due to their interest fees, which can significantly reduce profits. Additionally, we have lost confidence in trading on Bybit because of instances where they manipulate positions, resulting in lower profits. In contrast, BingX appears to be an ideal trading platform due to its favorable fee structure.

Over the past month, we have tested BingX’s fees with various strategies, including high leverage, high margin, short scalper trades, and longer weekly trades. So far, we feel confident that we are not being deprived of our profits, and the fees are transparent and as advertised. As many of you know, our strategies encompass both short-term and mid-term trades. BingX benefits us in both areas: we are not subjected to manipulative moves in short-term trades, and we avoid interest fees on mid-term positions. The reason behind this might be that both Binance and Bybit initially had excellent fee structures when they were less well-known. As their popularity grew and more people started using their exchanges, they likely felt confident that users were joining them for their established reputation rather than their fee structures. But don’t get us wrong; we still like Bybit and will continue using it, primarily for the Bybit Card feature and to store some coins that other exchanges might not yet support. All 3 Exchanges are trusted with reserve funds and are transparent about all of their movements.

Join Bybit: https://partner.bybit.com/b/44149 (Best for Crypto Cards + Free Airdrops) Join BingX: https://bingx.com/invite/IMZYPAVP6 (Best For Fees + -20% from Commissions + No KYC needed)