Are fees everything? Should they really be the deciding factor when choosing which cryptocurrency exchange you should use?
In a way, yes…but it’s a bit more complicated than choosing the exchange with the lowest fees and opening an account. Take Binance vs. Gemini for example.
At first glance, you’d think Binance would win a comparison because of Gemini trading fees, which are higher for most traders. Given all the love for Binance on every crypto website, it would seem like an easy choice. This isn’t to throw shade at these people…you’ve probably seen the same thing on this site before.
Fees aren’t a bad way to pick an exchange, especially if you have a lot of coins or trade in high volumes, but low fees aren’t the end all be all they used to be. The main thing to consider is how those fees get applied. As a case in point, let’s look at Binance vs. Gemini (with a little Coinbase thrown in for reference) to see how a platform with higher fees could still save you money long-term.
What To Know About Binance vs. Gemini Fees
If you’ve read articles here before, you know that one of the biggest reasons I love Binance is their low and straightforward fees. They have one of, if not the, best fee structures in the crypto world.
If you use an ACH or wire transfer, you can deposit onto Binance for free. You can use a card, but it will set you back 4.5%. If you want to get around this, you can always find an exchange with a lower fee and then transfer your coins to Binance for free.
Cryptocurrency exchange rates on the platform are .1% for both maker and taker fees. That fee drops to .02% for makers and .04% for takers when exchanging futures. You also get a 25% discount when using BNB, which is Binance’s crypto token.
You can transfer cryptocurrency onto Gemini for free, and you also won’t have to pay for an ACH or wire transfer. They have a fee for using your card as well, but it’s only 3.49%, which is actually cheaper than Binance.
Gemini exchange fees are more complicated, as you’ll pay a convenience fee and a transaction fee. The amount of the transaction fee depends on the amount of money you spend and the platform you use to trade (phone, website, or ActiveTrader).
The convenience fee is .50% above the Gemini market price for a particular coin. Other than that, you’ll pay a flat transaction fee:
|Order Amount||Transaction Fee|
|Less than or equal to $10||0.99|
|$10.01 – $25.00||$1.49|
|$25.01 – $50.00||$1.99|
|$50.01 – $200.00||2.99|
|Greater than $200.00||1.49% of order value|
Gemini’s ActiveTrader Option
When you use the ActiveTrader option, you’ll find that their fee structure is very similar to Binance. There are maker and taker fees that decrease the more you trade. With that said, Binance charges slightly less and has different 30-day trading average markers to meet.
Gemini’s targets don’t start until you get to $500,000, whereas Binance has levels starting at $10,000. This creates a strange situation where you’ll pay less when you first start with Gemini, but then Binance becomes cheaper once you hit $50,000 in trade volume.
|30-Day Trading Avg.||Taker Fee (Gemini/Binance)||Maker Fee (Gemini/Binance)|
|Up to 10k||0.35% / .50%||0.25% / .50%|
|10-50k||0.35% / 0.35%||0.25% / 0.35%|
|50-100k||0.35% / 0.25%||0.25% / 0.25%|
As you grow your money, Gemini trading fees are slightly more, but that adds up quickly. For example, if you ever get a point to where you’re trading 2,500,000 a month in crypto, Gemini will charge you 0.25% for taker fees and 0.15% for maker fees. Binance, on the other hand, charges 0.18% for both.
Once you get into the 15 million range, you’ll pay less in fees on Gemini than you would on Binance whether you’re a maker or a taker! The best part is that you can take some of those savings and send me a coin or two. It will be our little secret.
Thus, the problem with fees: every site has different levels and different fees, meaning that what works for you probably won’t work for someone else. This doesn’t make looking at fees meaningless, but it means that you need more context when determining where to take your business.
What About Coinbase and Coinbase Pro?
If you’re wondering about Coinbase and Coinbase Pro, they charge more in fees than these sites, but there are some advantages to using them as well. If you’re new to the crypto game, they have a very friendly user-interface. They make it easy to see exactly what coins you have, how much money is in your account, and you can earn some coins by watching small videos about new coins.
Personally, I’d recommend Gemini or Binance over Coinbase, but if you want a straightforward experience or an easy way into crypto investing, Coinbase will serve you well.
Apart from the Binance and Gemini fees, there are some other things you should look at; namely, getting your money into your bank account and making money on your coins while you store them.
Earning Money on Your Coins
Crypto lending is one of the newest ways people are using their coins to make money. Owning coins and watching their value grow is always fun, but imagine how much more entertaining it would be if you put those coins to work?
With Gemini, all you have to do is open an account and opt-in to Gemini Earn. Once you buy or transfer coins, they’ll start earning interest immediately. The amount that you earn depends on what coin you have, but they have very impressive rates. The best part is that you can redeem your coins and interest at any time and put them back into your trading account, allowing you to adjust to changing rates!
Let’s say you open a Gemini account and buy $5,000 in Litecoin. The interest rate on Litecoin is currently 4.50% APY, so after two years you’d earn an extra $460. Other coins, like Dai, actually have a higher interest. This is a great way to grow wealth, as these interest rates are much higher than the average savings account.
Binance doesn’t have a way to let you earn interest, whereas Coinbase has a limited version of this on their wallet. The Coinbase version gives you limited options and doesn’t let you redeem your coins and interest as quickly as Gemini, though.
Getting Your Money
There’s no point in investing in crypto if you can’t get your money when you want it. You also don’t want to waste money paying pointless fees for transferring your money from an exchange to your wallet or bank account.
If you want to get your money off of Binance, you can do an ACH for free, but other methods will cost you. A wire transfer will cost you $15, and if you want the money put onto your debit card, it’s a 4.5% fee.
You’ll also pay a percentage of each coin withdrawal depending on the type of currency. Some of these fees can be rather large; with Dogecoin, for example, you’ll have to give Binance 50 coins per withdrawal. With Dogecoin currently on its way to the moon, that could end up being a nice chunk of change soon.
Coinbase also offers free ACH withdrawals, but their wire transfers cost $25, or $10 more than Binance. There isn’t a withdrawal fee per se, but there is a ‘network fee’ that fluctuates depending on how busy the network is for the type of coin you’re moving.
Gemini makes withdrawing money fairly simple. You’re given 10 free withdrawals a month, and you can always withdraw GUSD for free without it counting against the 10. If you play your cards right and plan ahead, you’ll probably never have to pay a withdrawal fee!
I personally like to use Gemini as an off-and-on ramp for Celsius. I buy GUSD for free, send it to Celsius, let it earn 10.51% APY (or whatever rate it is today), and then return it back to Gemini to withdraw for free. It’s about as close as you can get to printing money.
If you’re into random altcoins, you can also buy crypto on Gemini, ship it to your ledger wallet or a DEFI exchange, and then use that to buy your choice of coins.
Other Things To Consider
Security wise, Gemini is a great choice. They’re a New York Trust Company that’s subject to the cyber security regulations of the New York Department of Financial Services. They’re also the first exchange to complete a SOC 1 Type 2 and SOC 2 Type 2 exam.
They require two factor authentication, hash and salt your password, and limit certain operations to defend against brute force attacks. They’re one of, if not the, most secure networks out there.
They’ve also put a lot of work into their interface. If Coinbase has the best interface for new users, Gemini comes in at a close second. Their platform is intuitive and easy to use. When I first signed up for them, it only took me about five minutes to find everything I needed.
Gemini’s Fee Schedule Lets You Put Your Money to Work for You
Ultimately, you’ll pay a little more in trading fees at first, but with the other benefits they offer, Gemini could very well be the best crypto exchange out there. If you’re looking strictly at it from a Binance vs. Gemini perspective, it really depends on what you want to do with your coins. If you want to put them to work for you, Gemini is the way to go.
For the rest of your coins, make sure you’re keeping them safe in a secure wallet. If you’re looking for a great wallet, I have an entire list of the ones I love here. Personally, I recommend the Ledger Nano X because it’s easy to use and very safe.
Drop a comment below if you have any experience with these two crypto trading platforms, and let me know what you think!
Great info. Just getting started, got my 1st hw wallet. Now looking for a broker? Gemini looks to be the one but will do more research. Have a good day.
Yep, it’s the right place if you plan to move it to your wallet. Just make sure to use active trader mode to keep costs low.
This is an awesome article! Would love it if you could also write one for the Gemini API? If you use the Gemini API to buy crypto, I think your case for Gemini vs Binance may favor Gemini even more. I’m still working to wrap my head around it, but your approach would be insanely helpful 🙂