Cryptocurrency trading has become the rave of the moment. However, cryptocurrency trading transactions come with some transaction costs which many buyers may find discouraging. In this article, you will learn how you can trade on Coinbase and GDAX without paying any fees. It is important to note that Coinbase is a digital currency exchange based at San Francisco, California, United States. GDAX is a Digital Based Asset Exchange which is also based in the United States.
You can actually avoid these exchange fees because both Coinbase and GDAX are under the same ownership. Typically, GDAX charges very low fees for carrying out certain crypto trades.
Why Should I Follow This Guide?
This guide will be of immense benefit to you. The cost of trading on Coinbase is quite high and you wouldn’t want to pay an extra 4% on every transaction you make on the platform, would you? Coinbase charges you about 4% of deposits made using your debit card or similar bank transfers. In another setting, you pay 1.4% for any cryptocurrency purchase and the same rate whenever you sell. With such a fee structure, it becomes very hard to make good profits in cryptocurrency trading.
You need to understand that the GDAX exchange has a fee structure. GDAX operates a Maker and a Taker Order fee structure.
For the Maker Order, you offer a transaction to a prospective buyer who accepts to do the transaction with you. Therefore, you are the Maker and the person that accepts your transaction is known as the Taker.
In the reverse scenario, when you accept the offer from someone at either the market price or the person’ price, you become the Taker and the other person becomes the Maker. In this case, the Maker Order comes into being when you are the Maker and the Taker Order is when you accept to do or have done a transaction with another entity.
How to Get Started
The first step to take in trading on Coinbase and GDAX with zero fees is by getting registered on both platforms. You can use this breakdown to understand how to get registered:
Visit https://www.coinbase.com/. Sign up with your details and complete the verification process by uploading your valid ID. When you verify your identity on Coinbase through your ID and bank account, your withdrawal and spending limits will be expanded.
Deposit some funds to your Coinbase account. Before doing this, make sure you have already linked your bank account with your Coinbase account.
Visit https://www.gdax.com/ and sign up. Remember to complete the verification. You are now set to trade!
Transfer the funds to your Coinbase account to your GDAX account. The transferred funds should reflect almost immediately in your GDAX account.
When the transfer has been done, you should go back to your GDAX account. Try to perform a trade/transaction from your GDAX account. You can locate this feature by using the trading window located on the left-hand side of your PC screen.
How to Fund Your GDAX Account
Funding your GDAX account might give you some problems so we have this concise guide to help you out. You have three options to use when funding your GDAX account and you can use any that appeals to you.
You can add funds to your GDAX account by adding your bank details. This process might take up to 10 business days to take effect.
Using the Bank Wire function costs some money and if you’re looking for a way to avoid extra costs in funding your GDAX account, the Bank Wire funding option is not advisable. You will be charged a transaction fee of about $10 when you fund your GDAX account and about $20 when you send funds. To fund your account through the Bank Wire option, you should initiate the process before 1:00 pm if the funds are to be credited to your account on the same day. Initiating the funding after 1:00 pm will lead to your account being funded the next business day.
You can move your funds from your Coinbase account into your GDAX account after you must have registered on GDAX. Using this option gives your GDAX account immediate funding because both GDAX and Coinbase are owned by the same company.
Trading on Coinbase
Now that your GDAX account has been set-up and fully funded, you can now trade on any cryptocurrency of your choice on the Coinbase platform. Your knowledge of the Maker and the Taker Orders will help you in your transactions.
You also need to know how to use the “Limits” option in your transactions. Luckily, GDAX does not charge any fee when you trade on the platform as a Maker. So to ensure zero fees on Coinbase transactions, always use the Maker Orders and you will not be charged any fee. However, if you are not familiar with using the “Limits” option to place Maker Orders, kindly read below to find out how you can do so.
The “Limits” options are two and they are Limit Buy and Limit Sell.
In the Limit Buy option, you (the Maker) place an order with conditions like the quantity of the order and the price such a quantity should be sold. For example, if the price of Bitcoin to a dollar is $1,100, you can offer to buy two Bitcoins when the value of Bitcoins to the dollar is $1,000. This means that your offer to purchase the Bitcoin can only be executed (accepted) when the price of the Bitcoin to the dollar drops to the rate you specified or when someone decides to accept your offer at your given rate.
You are the one in charge at this point. The Limit Sell is the order in which you state the quantity and the price you will offer to trade on a particular cryptocurrency in Coinbase. The Order here is the condition that you attach to the quantity of your order. Execution comes into being when the conditions of your order have been met and it is set to be purchased.
The guide given above will help you trade on Coinbase and GDAX with zero fees. You can now trade on the Coinbase platform after fulfilling these conditions. You are now free to buy and sell Bitcoins, Litecoin, Ether and other Cryptocurrencies without any extra cost. We hope you find this guide helpful and we wish you a happy trading!