Coinbase Pro has announced a new fee structure that will lower fees for high-end traders but will raise them for lower-tier traders.
As a rule of nature, nothing ever remains constant (except for death and taxes, of course). Things evolve over time to reflect the world at large, such as a company raising the price of gasoline due to an increase in demand. The world of cryptocurrency is not immune to such changes. Coinbase, the San Francisco-based exchange, announced a change in their fee structure for Coinbase Pro. The new fees will be welcomed by some but lamented by others.
New Fee Structure Coming
On a recent blog post, the exchange noted that a new fee structure for Coinbase Pro will be implemented on March 22 at 6 pm PDT. The new fees are “designed to increase liquidity, enable better price discovery for trades, and to make price movements smoother.”
Coinbase Pro raising fees for smaller clients by 33% while lowering fees for larger clients.
Reason: “to further optimize the market health of our platform”. pic.twitter.com/zS3KMSPCND
— Alex Krüger (@krugermacro) March 15, 2019
The fees will vary by what trading tier the user will fall into. The lower tiers ($50 million and under) will see fees split between makers and takers. Tiers that are $50 million and over will only see taker fees.
Lower tiers will see an overall fee increase. Currently, those with less than $100,000 in trades (within 30 days) pay 0.3 percent (taker only), but this fee will increase to 0.4 percent (0.25 percent taker and 0.15 percent maker) after the change is implemented. The $100K to $1 million tier will stay at 0.3 percent but the taker fee will drop from 0.3 percent to 0.2 percent while a 0.1 percent maker fee is added.
A good listing of all the changes is shown in the above tweet by Alex Kruger.
Coinbase Pro Rewards the Whales
The new fee structure from Coinbase Pro helps out the big traders while increasing fees for those on the lower rungs. Those trading between $50 to $100 million will see fees drop in half. The $100 to $300 million tier features a drop from 0.1 percent to 0.08 percent. The rest of the high-end tiers see fees drop from 0.1 percent to 0.7 percent ($300 to $500 million), 0.6 percent ($500 million to $1 billion), and 0.5 percent (over $1 billion).
In addition to the new fees, Coinbase Pro and Prime will stop supporting stop market orders. All open stop market orders will be canceled on March 22 when the new fees are introduced. Such orders may now only be placed as limit orders and include a limit price.
The platform is also adding a 10% market protection point for all market orders. The blog states:
Market orders that move the price in excess of 10% will stop executing and return a partial fill. For example: a market buy submitted when the last trade price is $4,000 will only fill at price levels below $4,400. Protection points help prevent large orders from causing more than 10% slippage.
The platform will begin a downtime period at 6 pm PDT on March 22, and markets will restart 30 minutes later. At that time, the new fees and market structure rules will come into play.
What do you think about these changes coming to Coinbase Pro? Let us know in the comments below.
Images courtesy of Twitter/@krugermacro, Pxhere, and Pixabay.