Like all businesses that involve a third party, trading crypto futures involves taking costs into account in the form of commissions. There are numerous futures trading platforms, among the best known are Binance, Huobi, Kraken and other promising ones like FTX US. All of them have a commission scheme for the different operations.
There are basically two types of commissions on future crypto options. These are those applied to liquidity injectors or creators (maker fees) and to those who withdraw or receivers of liquidity (taker fees). These two types of commissions, although they have different applications, the purpose is the same, to allow the exchange to maintain its activities as a mediator.
In other words, commissions are necessary elements, even if they often take a novice trader by surprise. Therefore, it is important that those who are considering the possibility of entering the world of futures, take a look at operating costs. These mainly focus on those two types of commissions, also called payment per order flow.
What are the costs of trading crypto futures?
There is no fixed cost that can be stated as standard when trading crypto futures. In that sense, everything will depend on the volume of the operation that is opened. In other words, the cost must be calculated by the trader with the percentage of the commission according to the amount of liquidity bet.
As highlighted above, there are two types of commissions required by exchanges in this type of electronic commerce, the maker and taker fees. It should be noted that the former, consisting of liquidity injectors, are smaller than the latter. Thus, if the trader in question is a creator of liquidity, the percentage that he pays in commission is less than that paid by the receiver of liquidity.
Whoever places a limit order below or above the market price is a liquidity injector in the order book (book order). In this way, increasing liquidity is good, both for the platform and for traders. Therefore, the operator is rewarded with a low commission or maker fee.
The other side of the coin of crypto futures traders, the recipients of liquidity, are the ones who carry the highest commissions. It should be noted that these do not enjoy commission reimbursements as sometimes do the injectors.
Do not trust the apparent low commissions
Some novice crypto futures traders can be confident when they discover at first glance that the commissions are less than 1% or 2%. However, depending on the amount wagered, this can significantly impact your final returns.
For this reason, it is advisable to go to exchange platforms with double characteristics to be recognized and, at the same time, offer low commissions. There is little point in trading on a secure and widely accepted exchange if the scale of the fees plays a large role in the return.
Consequently, the previous study is the best tool that future investors have when embarking on trading. In conclusion, before starting in the world of crypto futures, it is important to be attentive to the commissions and the volume of exchange of the candidate platforms.
If you want to know more details about the costs of trading future options, you can study this Binance post.
The content of this work is purely informative and does not represent an invitation to invest in cryptocurrency futures. Nor should it be considered as an advertisement for the exchanges mentioned, which are named by way of example.