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💸 Fees & Liquidity: Trading Costs Compared

Compare gas fees, trading fees, and liquidity depth across platforms

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💰 Cost Comparison & Liquidity Sources

Trading costs and liquidity availability differ significantly between DEXs and CEXs. Understanding these economics helps you choose the most cost-effective platform for each trade.

🎮 Interactive: Fee Calculator

Calculate total trading costs on CEX vs DEX:

Buying ETH with USDC
$100$10,000
Current network congestion
$5 (low)$200 (high)
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CEX (Binance)

Winner
Trading Fee (0.1%):$1.00
Gas Fee:$0.00
Total Cost:$1.00
As % of trade:0.100%
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DEX (Uniswap)

Swap Fee (0.3%):$3.00
Gas Fee:$50.00
Total Cost:$53.00
As % of trade:5.300%
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Cost Analysis
CEX is cheaper by $52.00 (5.200%). CEX fees remain flat regardless of trade size.
Note: Actual costs vary by exchange, network, and time of day. L2 DEXs (Arbitrum, Optimism) have much lower gas fees (~$0.50).

Fee Breakdown by Platform

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CEX Fee Structure

Trading Fees:
  • • Binance: 0.1% (0.075% with BNB)
  • • Coinbase: 0.5% (0.6% for small trades)
  • • Kraken: 0.16-0.26% (volume tiers)
Other Fees:
  • • Deposit: Free (crypto), 1-4% (card/bank)
  • • Withdrawal: Variable by coin ($1-25 typical)
  • • Conversion: Included in spread
Fee Savings
Volume discounts, native tokens (BNB), VIP tiers can reduce fees significantly
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DEX Fee Structure

Swap Fees:
  • • Uniswap: 0.3% (goes to LPs)
  • • SushiSwap: 0.3% (0.25% LP, 0.05% treasury)
  • • Curve: 0.04% (stablecoin swaps)
Gas Fees (Ethereum L1):
  • • Low congestion: $5-20
  • • Medium: $20-80
  • • High (bull market): $100-500+
L2 Solutions
Arbitrum/Optimism DEXs have ~$0.50 gas fees while maintaining Ethereum security

Liquidity Sources

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CEX: Professional Market Makers

Centralized exchanges attract professional market making firms and high-frequency traders who provide liquidity.

Who Provides
• Market makers
• Institutional traders
• Exchange own capital
Incentive
• Bid-ask spread profits
• Rebate programs
• VIP fee discounts
Result
• Deep order books
• Tight spreads (0.01%)
• Large trade capacity
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DEX: Retail Liquidity Providers (LPs)

DEXs rely on community members depositing token pairs into pools to earn trading fees.

Who Provides
• Retail users
• Passive investors
• Yield farmers
Incentive
• Trading fees (0.3%)
• Token rewards
• LP token appreciation
Result
• Variable depth
• Wider spreads
• Risk of impermanent loss

When Each Is Better

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Use CEX When...

  • •Large trades: Deep liquidity prevents slippage
  • •Active trading: Low fees add up over many trades
  • •Fiat conversions: Only CEXs handle USD/EUR
  • •Speed matters: Instant execution for day trading
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Use DEX When...

  • •Small trades: Gas fees acceptable, avoid CEX minimums
  • •New tokens: DEXs list tokens immediately
  • •Privacy needed: No KYC, pseudonymous trading
  • •Self-custody: Avoid custodial risk entirely
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Pro Tip: Use Both Strategically

Experienced traders use both types of exchanges for different purposes:

  • ✓CEX for onboarding: Buy crypto with fiat, then withdraw to wallet
  • ✓DEX for DeFi: Trade directly from wallet, provide liquidity
  • ✓L2 DEXs for efficiency: Get DEX benefits with low gas (~$0.50)
  • ✓Compare before each trade: Calculate total cost including all fees