The cryptocurrency market has grown from an extremely new and illiquid market to an asset class with over $2 trillion in value. Markets are open for trading 24 hours a day, 7 days a week, and getting involved is fairly straightforward. But first, you’ll need to find an exchange.

Cryptocurrency exchanges are marketplaces that allow you to buy and sell cryptocurrencies at market prices. Exchanges aggregate orders in order to provide ways to buy and sell at any time. Using exchanges involves costs, depending on the frequency with which you trade and the type of asset traded. We’ll take you through everything you need to know about Bybit trading fees so that you can trade with a clear idea of your costs.

1. What Are Trading Fees? 
2. What Are Makers and Takers?
3. How Do Bybit Trading Fees Work?
4. Bybit Spot Trading Fees Calculation
5. Bybit Derivatives Trading Maker & Taker Fees
6. Bybit Deposit and Withdrawal Fees 
7. Leverage Fees
8. Bybit Funding Fees
9. How to Get Started 
10. The Bottom Line

What Are Trading Fees? 

Trading fees are the transaction costs you’re charged when you place any order on a marketplace exchange. Each type of transaction may have its own cost structure, which may be subject to change on short notice. In general, cryptocurrency trading fees include several types of costs.

Exchanges mainly generate commissions from the volumes traded. However, fees apply not only to trades, but to deposits and withdrawals, funding fees, margin and leverage costs, and even through bid-ask spread costs. Exchange fees usually vary from 0.1% to 1% or more per trade. But they varied from one exchange to another. Ultimately, it all boils down to the type of trading contracts and the exchange policies.

What Are Makers and Takers?

Marketplaces match buy and sell orders in order books. The maker and taker system is a method of classifying those orders to determine trading fees. A maker and taker are charged different fees according to whether they’re adding to the order book or taking away from it.

The term “maker” refers to a market maker, who provides liquidity to the market. For example, a maker increases the market depth of an order book, often by placing limit orders that don’t get matched right away. These orders give other traders the opportunity to trade against them. Market makers pay lower fees than takers, and in some cases may get rebates. For example, Bybit offers the Market Maker Incentive Program for traders to get up to 0.015% in maker fee rebate.

In contrast, “takers” remove liquidity from the market. They place market orders to immediately take liquidity off the order books. When you place an order that’s immediately filled, you’re a taker — so you pay a fee.

Actors 

Within any crypto exchange, traders act as either makers or takers. Makers provide liquidity and increase market depth of the order book while takers seek and take liquidity off the order book.

Factors 

When it comes to determining whether or not an order is considered a “maker” or “taker”, the key lies in the immediacy of orders filled. Market Orders are always executed as taker orders but Limit Orders may be executed as maker or taker orders. This is not to say that Limit Orders are inherently special. They are simply the only order type that doesn’t trigger an immediate buy or sell; a Market Order is immediate. 

Tip: At Bybit, you can enable the post-only feature to ensure that limit orders are executed only as maker orders.

How Do Bybit Trading Fees Work?

Bybit has a cost-effective fee structure that’s friendly to traders. The newly launched VIP program will revamp the existing trading fee rates for both the spot and derivatives markets, for which traders are only entitled to the benefits from the VIP or Bybit Loyalty program.

The breakdown is as follows:

The higher your tier is, the lower the trading fee rates you’re entitled to — our taker fee goes as low as 0.03% for derivatives and 0.02% for spot trading.

Note: The fee revamp of spot, perpetual and futures trading will start from March 11, 2022 6:30AM UTC. However, the fees update will be effective to all the symbols for derivatives instruments starting at 6AM UTC on March 18, 2022. Any existing fee discounts will be invalid after this time. Please note that it may take up to 60 minutes for the new rates to be reflected in your account on March 18, 2022.

From 7AM UTC on March 19, 2022 onward, the VIP level will be updated at 7AM UTC the next day and the fee rate will be reflected in your account within five minutes after the VIP level’s update.  The new spot trading fees will be effective from 7AM UTC on March 18, 2022.

Bybit Maker Taker Fees

Bybit differentiates between maker and taker fees by how quickly an order gets filled. Market Orders, which buy or sell at the best price in the market, execute immediately and are taker orders. 

On the contrary, Limit Orders are placed at a pre-specified price, and they execute when the market price is the same as, or better than, the limit. Limit Orders can be classified as maker or taker orders, depending on when they get filled.

• Taker Fee: Order Value × Taker Fee Rate
• Maker Fee: Order Value × Maker Fee Rate

The order value depends on the contract quantity and price. Its calculation also depends on whether you’re trading spot, a linear contract, a perpetual contract or an inverse contract, which we’ll explain below.

Bybit Spot Trading Fees Calculation

Formula:

Trading Fee = Filled Order Quantity x Trading Fee Rate

If the current price of BTC is $40,000. Traders can buy or sell 0.5 BTC with 20,000 USDT.

• Trader A buys 0.5 BTC using a Market Order with USDT.
• Trader B buys 20,000 USDT using a Limit Order with BTC.
• Taker’s Fee for Trader A = 0.5 x 0.10% = 0.0005 BTC
• Maker’s Fee for Trader B = 20,000 x 0.10%= 20 USDT

After the order is filled:

Trader A buys 0.5 BTC with a Market Order, so Trader A pays a taker’s fee of 0.0005 BTC. Therefore, Trader A will receive 0.4995 BTC.

Trader B buys 20,000 USDT with a Limit Order, and 0.1% of the maker’s fee is incurred. Therefore, Trader B will receive 19,980 USDT.

Spot Trading Fees Cross-Platform Comparison

*Entry Level Accounts

Take note:

– The trading fee unit charged is based on the purchased cryptocurrency.

– There is no trading fee for unfilled parts of orders and canceled orders.

Bybit Derivatives Trading Maker & Taker Fees

Perpetual & Futures Contract

Perpetual Contracts Fee Cross-Platform Comparison

*Entry Level Accounts

Calculating Bybit Derivatives Trading Fees

Formula:

Trading Fee = Order Value × Trading Fee Rate

Order Value = Quantity / Executed Price

For example, Trader A buys 10,000 BTCUSD contracts using a Market Order. Trader B sells 10,000 BTCUSD contracts using a Limit Order. If the execution price is $40,000:

• Taker fee for trader A = 10,000/40,000 × 0.06% = 0.00015 BTC
• Maker fee for trader B = 10,000/40,000 × 0.01% = 0.000025 BTC

Upon execution, Trader A will pay a taker’s fee of 0.00015 BTC. Trader B will pay a maker’s fee of 0.000025 BTC.

In addition to the changes, Bybit is offering a Market Maker Incentive Program to get up to -0.015% of the maker fee rebate. The taker fee rate is still determined by the respective VIP Level for market makers. Please refer to Institutional Services for the requirement and application method. 

Bybit Deposit and Withdrawal Fees 

As of Sept. 2021, there are no deposit fees when trading crypto on Bybit. However, there is a charge of withdrawal fees depending on the cryptocurrencies you’re withdrawing. 

These withdrawal fees refer to the miner or network fees, which are different for each cryptocurrency. The fees are shown in the following table:

No minimum deposit is required, though there are minimum withdrawal amounts.

Note:

Traders can check the minimum withdrawal and the fees details at the withdrawal windows. Learn how to withdraw crypto on Bybit here. 

Leverage Fees

Leverage is the act of financing assets using borrowed capital. It’s an investment strategy used to magnify returns on capital. Effectively, investors also use leverage to multiply their buying power in the market with the goal of increasing returns. 

Bybit offers up to 100× leverage and requires putting up initial margin and maintenance margin.

A trader who placed 100 USDT value of the order will pay trading fees of 100×0.06% (based on the quantity and price they input on the order confirmation window.) Leverage magnifies your trading fees. If you use 2× leverage, your trading fees would increase by 2×. For example, you placed an order of 100 USDT at 2× leverage, you would pay 0.06% on the value of 200 USDT rather than 100 USDT. 

Bybit Funding Fees

Funding fees ensure that the last traded price is anchored to the global spot price, similar to incurring interest in spot margin trading. Bybit provides certain rules for funding fees, which are as follows: 

• If the funding rate is positive, long position holders pay short position holders. If the funding rate is negative, short position holders pay long position holders. 
• Traders can only pay or receive funding fees every 8 hours if they hold a position at 16:00 UTC, 00:00 UTC and 08:00 UTC. 

Note: Not all trading pairs will receive the standard 8 hours funding fees interval. Trading pairs like XEMUSDT, STXUSDT, EGLDUSDT, ENJUSDT, FLOWUSDT, SLPUSDT will have a funding interval of every one hour. 

In the above screenshot, long position holders need to pay the indicated funding rate to short position holders in around 8 hours’ time.

Funding fees are calculated as follows with Bybit: 

Funding Fee = Position Value × Funding Rate

Position Value = Quantity of Contract / Mark Price

For example, a trader holds a long position of 10,000 BTCUSD contracts and the mark price is set at $8,000 with the current funding rate at 0.0408% (0.000408). In this case,

Position Value = 10,000/8,000 = 1.25 BTC 

Funding Fee = 1.25 BTC × 0.000408 = 0.00051 BTC

Because the funding rate turns out to be positive, long position holders have to pay short position holders when using Bybit.

How to Get Started 

Bybit offers a diverse and extensive range of knowledge bases including tutorial videos, blogs, and how-to guides to help users get started on the platform. Here’s a quick overview of how to begin trading on Bybit.

Bybit KYC Verification

Bybit offers a Know Your Customer (KYC) verification process to offer greater security and safe access to additional features. 

This process is done over several stages, consisting of different verification mechanisms. Official documentation required includes such as identification cards, bank statements, residency proofs and utility bills to unlock different withdrawal limits. Ultimately, the more information you provide for the verification process, the higher the withdrawal limit you’ll get. 

The following table explains the levels of KYC verification at Bybit.

Here are the steps for implementing KYC:

• Sign up
   or login to your account on Bybit.
• Click on your Avatar

Log in to your account and click on Account & Security, and then click on Verify Now. This will kick-start the process for Level 1 KYC. 

• Provide mandatory information to verify Level 1

1. Select the country that has issued your ID card/passport.
2. Upload a scanned copy of the ID document. 
3. Provide facial recognition via computer. 

Your level of KYC verification determines the maximum withdrawal limits. You can start at a withdrawal limit of 2 BTC and go up to 100 BTC per day.

The Bottom Line

Bybit has a smart, intuitive trading platform that provides reliable and easy ways to buy, sell, trade and earn cryptocurrencies. Getting started on Bybit is simple after completing a short KYC process. The website and app are user-friendly, and they allow trading at any time. 

As with any exchange, it’s important to understand the cost structures before beginning. Bybit uses a simplified maker/taker model to calculate trading fees that are affordable, and that add liquidity to the order books. No deposit fees are charged, and withdrawal fees are minimal. Both spot and derivatives trading fees are based on transparent and easy-to-calculate formulas. Once you understand the fee structure, you can feel confident placing trades on Bybit. Aside from habitually choosing to be market makers, there are other ways to reduce the number of trading fees one would have to fork out in every trade. At Bybit, those incentives include discounts in the form of trading rebates, VIP and loyalty programs. The Bybit Rewards Hub is filled with prizes for the taking, and the best part is — claiming one could be as easy as a social media “follow”.