The cryptocurrency market is full of people with a lot of opinions on cryptocurrency exchanges – including a heavy amount of negativity. People complain about the obvious stuff: missing funds, deposit problems, wallet access, withdrawal issues, etc. But the most talked-about sentiments is probably the fact that most exchanges charge too much, and if you’ve traded any crypto coin in your life you can certainly see where they’re coming from.
The way we see it, however, is that 2018 will be a year full of massive change in the cryptocurrency exchange space – and a lot of that change will have to do with fees.
Cryptocurrency exchange fees are shrinking
Well, that’s the case for Bitcoin (BTC) withdrawals, at least. In the past three days alone, three big exchanges have cut the price they charge for transferring funds from users’ BTC wallets to their bank accounts.
Effective immediately, withdrawal fees on Bitcoin (XBT) are reduced to 0.0005, and withdrawal fees on Bitcoin Cash (BCH) are reduced to 0.0001.
— Kraken Exchange (@krakenfx) March 1, 2018
Kraken and Binance (which has the 2nd-highest trade volume globally today) both brought their withdrawal commission down to 0.0005 BTC.
— binance (@binance_2017) March 1, 2018
Bitfinex, which is the 5th largest exchange when it comes to 24-hour volume, managed to lower its fee to 0.0006 BTC before ticking it down to 0.0004 BTC the very next day:
Since SegWit adoption we have managed to decrease our BTC withdrawal fees by 25%, to 0.0006 BTC.
We are working hard to reduce this number further in the upcoming weeks and we are excited by the improvements made possible by SegWit.
— Bitfinex (@bitfinex) March 1, 2018
We are excited to announce an additional 33.3% decrease in BTC withdrawal fees.
BTC withdrawal fees are now only 0.0004 BTC on Bitfinex. #SegWit
— Bitfinex (@bitfinex) March 2, 2018
Sure, those are much lower fees than before. But we can’t forget that Gemini Exchange doesn’t charge anything for its account holders to withdraw their Bitcoin funds – and that isn’t the least of what’s threatening top exchanges like Binance and Bitfinex who still charges users for taking out their BTC coins.
Cheaper, more flexible cryptocurrency exchanges are coming
This year is going to be full of new blockchain-based platforms (which are currently in development) that are going to offer a myriad of different crypto trading features. More importantly, a lot of them are going to be super cheap – and some of them will be outright free to use.
We’re not talking just withdrawal fees – we’re talking free coin-to-coin transfers.
There will also be a lot of multi-coin functionality, where you won’t have to buy ETH or BTC just to buy an altcoin – won’t that be nice?
There are a number of projects working on marketplaces like this, with a lot of main net launches slated for 2018. There is Robinhood Crypto, for example, as well as Tokia (TKA) – which is still holding its first token sale as we speak.
We can’t forget about Cobinhood, either, which was famously backed by Jamie Foxx. Another one is OmiseGO (OMG), which we’ve covered before. Ethos (ETHOS) is another high-potential future offering – and I’m sure there are more that we haven’t named.
Our point is this: currently popular coin trading platforms will need to continue to decrease their fees if they have any chance of surviving when these sleeker, younger, and cheaper competitors enter the marketplace.
Now that Binance, Bitfinex and Kraken have all made moves in this direction, which ones will be next?
Coinbase or Huobi might take the hint next
Huobi and Coinbase are two of the most popular places to buy cryptocurrencies – especially top coins like ETH and BTC. We’ve already seen three wildly successful platforms drop their withdrawal fees, so it’s very likely that Coinbase (which already gets a lot of heat for its inflated commissions) and Huobi will be the next in line.
By the end of 2018, there should be at least a couple options out there for us with super cheap fees – and expensive Coinbase withdrawals will be a thing of the past.
Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.