Bitcoin Exchange Fees Explained
HodlHodl is a P2P Bitcoin trading platform that charges a fee on each successfully completed trade. The fee is a percentage of the amount of Bitcoin transferred to the escrow address, ranging from 0.45% to 0.5% depending on the user's account status.
How Do Bitcoin Exchange Fees Work?
When a contract is created, each counterparty pays their own respective fee rate independently. For example, if the seller has a fee rate of 0.5% and the buyer has a rate of 0.45%, each party pays their own rate — the seller pays 0.5% and the buyer pays 0.45%.
HodlHodl receives fees in Bitcoin only. The fees are calculated from the Bitcoin deposit and deducted upon release from escrow — and only if the contract was completed successfully.
- The seller deposits Bitcoin into escrow including their trading fee on top of the contract amount.
- The buyer receives slightly less Bitcoin than was deposited in escrow, with their trading fee deducted from the release amount.
- In turn, the buyer sends the agreed fiat amount to the seller.
This way, both buyer and seller each pay their own respective share of the fee.
There is also a Bitcoin network (transaction) fee deducted from the deposit upon release. Since it would be impractical to split this fee across the fiat side of the contract, the transaction fee is always covered by the buyer.
How Much Does It Cost to Use HodlHodl?
There are different trading fee rates depending on the user's status:
Standard registered user — 0.5%
User registered with a referral code — 0.45%
User who has referred at least one active trader — 0.45%
💡 Using a referral code when registering permanently reduces your fee from 0.5% to 0.45%.
What Is the Minimum Trading Fee?
All trades are also subject to a minimum trading fee, which applies when the standard percentage-based fee would be too low to cover transaction costs.
The standard trading fee is 0.5% per side (or 0.45% with a referral code). However, on small trades, this percentage can result in a very low absolute amount — in those cases, the minimum fee floor kicks in instead.
The minimum fee is dynamic and depends on:
- Current Bitcoin network congestion (mempool state)
- The size of the transaction in bytes
Under normal conditions, it does not exceed the equivalent of 5 USD in BTC. During periods of high network activity, it may be slightly higher.
⚠️ Important: As stated in HodlHodl's Terms of Service, the final fee (platform fee + Bitcoin network fee) only becomes visible after the seller sends Bitcoin to the escrow address. Before that, only an estimated fee is shown during contract creation — because the actual Bitcoin network fee cannot be predicted in advance and may vary based on current blockchain conditions.
HodlHodl is not responsible for the Bitcoin network transaction fee.
Practical Example
Trade: 1 BTC at $10,000 — Seller fee: 0.5% — Buyer fee: 0.45%
Seller side: The seller deposits 1.0050 BTC ($10,050.00) into escrow. Of that, 0.0050 BTC ($50.00) is their trading fee, and 1.0000 BTC ($10,000.00) is the contract value.
Buyer side: The buyer receives 0.9955 BTC ($9,955.00). Their trading fee of 0.0045 BTC ($45.00) is deducted from the release, while they send $10,000 fiat to the seller.
Total fees withheld from escrow: 0.0095 BTC ($95.00)
In summary: the seller deposits 1.005 BTC → escrow withholds 0.0095 BTC in fees → the buyer receives 0.9955 BTC, while sending $10,000 fiat to the seller.