No matter if you are a professional trader or if you are just a HODLer, at one point every crypto holder has to make a trade. When you trade, you have to pay trading fees.
I have decided to compare the trading fees from the two popular cryptocurrency exchanges Binance and KuCoin. I believe that both exchanges are comparable because both have their own exchange tokens giving benefits to their users.
Let's see on which exchange you pay less trading fees, on Binance or on KuCoin?
Trading Fee Structures
Both exchanges have a base trading fee. On Binance, it is only 0.1% for regular spot trading. This base fee of 0.1% is the same for makers and for takers.
For futures trading, the base fee is even lower, with a 0.02% maker and a 0.04% taker fee for USD-M Futures Trading and with a 0.01% maker and a 0.05% taker fee for COIN-M Futures Trading.
On KuCoin, it gets a little bit more complicated as there is not only one base fee for all regular spot trades like on Binance. On KuCoin, there are three different Classes of coins and tokens. Class A coins have a base fee of 0.1%, Class B coins have a base fee of 0.2% and Class C coins have a base fee of 0.3%. These are big differences. The actual spot trading fees will be based on the base currency of the trading pairs. For example, for KCS/BTC, KCS/ETH, and KCS/USDT, the spot fee rate is based on $KCS which is a Class B coin with a base fee of 0.2%. This fee structure is not only more complicated on KuCoin than on Binance but in some cases also 100% (B-Coins) or even 200% (C-Coins) higher than on Binance.
For futures trading, the base fee on KuCoin is lower, with a 0.02% maker and a 0.06% taker fee for Perpetual Contracts Trading and with a 0.02% maker and a 0.06% taker fee for Delivery Contracts Trading. For futures trading, the frees are only slightly higher than on Binance.
On both exchanges, there are different possibilities to reduce this base trading fee, for example by paying the trading fees in the respective exchange token.
Exchange Tokens
Both crypto exchanges have their own native exchange tokens. If you choose to pay your trading fees in the respective exchange token, you can get a discount on your trading fees.
If you choose to pay your trading fees on Binance with $BNB, you will get a 25% discount on your spot trading fees and a 10% discount on your futures trades. If you choose to pay your trading fees on KuCoin with their token $KCS, you will get a 20% discount on your spot trading fees.
According to my math, if you decide to pay all trading fees in the native exchange tokens, Binance is always at least 5% cheaper.
Loyalty Rewards Programs
Both exchanges are running Loyalty Rewards Programs. Depending on your trading volume over the last 30 days and the amount of the respective exchange token that you are holding on the exchange, you can reduce your trading fee to a tiny fraction of the original base fee.
As you can see on both screenshots below, you do not only need to trade a lot but you also need to hold a lot of exchange tokens. And I really mean a lot. 🤓
The loyalty program on KuCoin works the same way as on Binance with the difference that it is based on the three different classes of coins.
Trading Fee Promotions
You can also keep an eye on special trading fee promotions that both exchanges are running frequently. For example, Binance is running a trading fee promotion right now for stablecoin trading pairs. Binance has extended the Zero Trading Fee Promotion to include all $USD stablecoin trading pairs until the end of June 2022. You can read the announcement here: "Binance Extends the Zero Trading Fee Promotion to All USD Stablecoin Trading Pairs"
I recommend keeping yourself up to date by following both exchanges on their social media channels like Twitter or Telegram so that you don't miss any opportunity to save and/or earn some crypto.
Slippage Rate
I also like to mention that there is another important factor to keep in mind when it comes to trading cryptocurrencies. Besides the trading fees charged by the exchange, also a bid-ask spread or a certain slippage rate can change the final price of your cryptocurrency trades. You can not always avoid a bid-ask spread or slippage, but it is worth factoring them into your decisions, especially when it comes to trading on decentralized exchanges.
This rate can be minimal with smaller trades but with larger trades, the average price per unit might be higher than expected because of a negative slippage rate.
If you like to know more about spread and slippage, why they are necessary, and how you can minimize a negative slippage, I recommend reading this article: Bid-Ask Spread and Slippage Explained
My Final Words
Binance is my first choice when it comes to regular spot trading. The fee structure is not only simple but in most cases, the trading fees are also lower than on KuCoin. For all other coins and tokens that I can't trade on Binance (yet) like $DFI, $AMPL, or $KCS, I use KuCoin.
By the way, there is also another possibility to reduce your trading fees on Binance. When you use an invitation code when you sign up for Binance, it will save you another 10% trading fees each time you perform a trade on Binance. So, if you are for some crazy reason not registered on Binance yet, you can use my referral link with the invitation code E3PGAJCE for signing up. If you use that code for signing up, you will always trade cheaper on Binance than on KuCoin.
Finally, I also like to remind you that my intention in this post is to raise your awareness of the trading fees on two of the most popular cryptocurrency exchanges Binance and KuCoin. My intention is not to replace your own research. I may look quite smart on my profile pic but I am not your financial sensei. 🤓
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