How to calculate Kraken contract transaction fees

To calculate your Kraken contract transaction fees, determine the contract type, volume, account balance, tier level, and applicable maker/taker fees.

Nov 10, 2024 at 08:16 pm

How to Calculate Kraken Contract Transaction Fees

Understanding Kraken's Contract Fee Structure

Kraken offers a tiered fee structure for its contract trading services, with fees varying based on the contract type, trade volume, and account balance. Understanding this fee structure is crucial for calculating the total cost of your contract transactions.

Calculating Contract Transaction Fees

Follow these steps to calculate your contract transaction fees on Kraken:

1. Determine Contract Type and Volume:

• Identify the type of contract you wish to trade (e.g., perpetual or futures).
• Determine the contract size and trade volume.

2. Check Account Balance and Tier Level:

• Log in to your Kraken account and check your account balance.
• Determine your tier level based on your trading volume over the past 30 days.

3. Calculate Maker and Taker Fees:

• Maker fees are charged for placing orders that add liquidity to the order book.
• Taker fees are charged for executing orders that remove liquidity from the order book.
• Kraken's fee schedule provides specific maker and taker fees for each contract type and tier level.

4. Apply Referral Code (Optional):

• If you have a referral code, you may be eligible for reduced fees.
• Apply the code at the time of account registration or before placing a trade.

5. Calculate Total Transaction Fee:

• Multiply the trade volume by the applicable maker or taker fee.
• Apply any referral discounts or other applicable adjustments.

Example Calculation

Consider the following example:

• Trading 1 BTC perpetual contract (contract size: 1 BTC)
• Account balance: $500,000
• Tier level: Tier 1
• Maker fee: 0.0005%
• Taker fee: 0.0007%

Maker Fee Calculation:

• Calculate the maker fee as follows: 1 BTC * 0.0005% = $0.050

Taker Fee Calculation:

• Calculate the taker fee as follows: 1 BTC * 0.0007% = $0.070

Additional Considerations

• Funding Fees: Perpetual contracts are subject to funding fees that can affect your overall transaction costs.
• Margin Interest: If you trade with leverage, you will incur margin interest, which is calculated based on the amount of leverage used and the length of time the position is held.
• Third-Party Exchange Fees: If you transfer your assets from an external exchange to Kraken, you may incur additional fees from the third-party exchange.

Minimizing Contract Transaction Fees

• Use a referral code to lower your fees.
• Increase your trading volume to move to a higher tier and benefit from lower fees.
• Make orders that add liquidity (maker orders) to save on fees.
• Avoid trading during periods of high volatility when fees can be higher.