Bitmain turmoil: Co-founder and executive director Micree Zhan ousted ( CoinDesk).Bitcoin advocate Jack Dorsey backs crypto startup CoinList ( WSJ).Fintech innovation labs as “innovation theatre” ( FT Alphaville).What’s blockchain actually good for, anyway? For now, not much ( Wired).While there’s always a temptation to speculate on price spikes, intelligent investors would do well to make a few decisions and stick to them. The major takeaway is this: the more often you trade, the less you get to keep. Robinhood declined to answer whether Robinhood Crypto is profitable.
If anything, Robinhood’s zero-fee crypto trading is an outlier, and it appears to be subsidized by other activities (such as margin trading fees and payment for order flow). When you consider that crypto exchanges don’t charge for advisory services, it seems like trading fees are one of the few ways they afford to keep the lights on. And unlike stock brokerages, many have only been around for about five to seven years. To be fair, crypto exchanges provide a valuable service, connecting buyers and sellers. Coinbase did not immediately reply to my inquiry, while Gemini declined to comment. I reached out to Coinbase and Gemini to ask whether they foresee crypto commissions falling in the future. However, they’re still elevated compared to the commissions charged by other crypto trading platforms like Kraken (which charges between 0.16% and 0.26% for 30-day trading volume $50,000 or below) and Binance (0.1% for up to 50 bitcoin in trading volume during a 30-day period). So, it’s little wonder that Coinbase and its peers have made a killing.įees on Coinbase Pro, a platform for the exchange’s more frequent traders, aren’t quite as severe. Paying $2.99 for $200 of bitcoin incurs about 1.5% in fees. The percentages aren’t quite as painful for larger orders, but they still seem exorbitant. Indeed, if you buy less than $10 of bitcoin on Coinbase or Gemini, you pay 10% or more in fees.
For retail investors, these commissions feel like a disservice-and they’re certainly high compared to the trends in stock trading.