Peer-to-Peer Escrow Fees
2 mins
There are three types of fees you need to be aware of while trading on a peer-to-peer marketplace such as LocalCryptos: (i) network or regular cryptocurrency transaction fees, (ii) escrow fees, and (iii) fiat payment processing fees.
Cryptocurrency Transaction Fees
Cryptocurrency transaction fees are also known as blockchain, network, or just transaction fees.
Transaction fees are paid directly to cryptocurrency miners as a substitute for their work in securing the system. Miners play a critical role in every cryptocurrency network; they verify and validate blockchain transactions and keep the network secure and reliable.
Transaction fees serve two purposes: one, they purposefully make transacting on the blockchain costly in order to disincentivize spam transactions and thus protect the network from congestion; and two, they create an additional financial incentive for miners besides the block rewards, which further boosts the network's security by making cryptocurrency mining more attractive.
Transaction costs are different for each cryptocurrency and vary depending on the current network congestion. In times of high network activity transaction fees are higher, and during times of low congestion or activity, they're lower.
Cryptocurrencies with higher transaction throughput, such as Litecoin and Dash, have very low fees, usually amounting to several cents per transaction. Ethereum and Bitcoin, on the other hand, have much higher transaction fees, generally ranging between $2-$10 in times of high network activity.
Escrow Fees
The escrow fees are the transaction fees that are paid to LocalCryptos.
LocalCryptos charges a 0.25% fee for the maker (the person who placed the offer listing) and 0.75% for the taker (the person responding to the offer) on each completed escrow.
LocalCryptos doesn't charge any additional fees (such as withdrawal fees), and our rates are some of — if not the most competitive rates in the industry.
Fiat Payment Processing Fees
All fiat payments on LocalCryptos are peer-to-peer, meaning they're made outside the platform using regular payment channels like PayPal, Venmo, Payoneer, Transferwise, wire transfers, cash-in-hand, and others.
The fiat payment processing fees are solely determined by the service providers used for the outbound transaction.
Author
Stefan is a full-time crypto writer and a part-time podcast addict. He holds a master's degree in Commercial Law with a graduate thesis in cryptocurrency regulation. He spends his free time lawyering around the block and lifting heavy objects off the ground. With his mind.
Faculty of Law ”Iustinianus Primus“ - Skopje, LL.M Business Law
Skopje, Macedonia
