Topic: [ANN] KRAKEN.COM - Exchange with USD EUR GBP JPY CAD BTC LTC XRP NMC XDG STR ETH - page 243. (Read 628889 times)

I didn't intend it as an excuse, just stating a fact. For some exchanges, there are considerable fees for depositing or withdrawing fiat from your account, and this is part of the overall cost of using their services. So if you are evaluating the true cost of an exchange, you need to consider more than the trading fee.

Our introductory rate was too low by a factor of two and this had to be addressed. We didn't raise the fee as much at the lowest volume tiers because we analyzed this and found there wasn't much advantage to it. You may have heard of the "80/20 rule," which refers to the idea that 80% of trade volume comes from 20% of traders. This rule holds for us (in fact the disparity is slightly higher). This means that there is comparatively little advantage to having higher fees at the lower volume levels. We wouldn't gain much by raising our highest fee to 0.4% over 0.35% and we thought it was more important to have the highest fee start a bit lower. So, it's absolutely not our intention to punish higher volume traders more, it's just that there wasn't any payoff for raising fees at the lower volume levels as much.


We did consider a maker-taker model. It's a very interesting model and we may try it someday. But there are cons to the maker-taker model. One is that if the make-take fee disparity is too large, it can actually hurt liquidity, because you just end up with no one trading and everyone trying to provide the liquidity. Given the target we had for our fees, we felt that we'd need too large of a make-take fee disparity so decided against it for now. Another con is that speed becomes hugely important because que prioritization becomes a big part of the game. It can start to skew things pretty heavily in the direction of high frequency trading and we don't want to go too far in that direction. And the focus on speed can lead to attempts at slowing others down with quote stuffing and other annoying tactics. I'm sure a maker-taker model can work well, but it's no bed of roses and a somewhat delicate matter to get right.  

Thanks again for your feedback Serpens.

The new fee is in line with other exchanges, but the fee<->volume ratio is completely out of balance. I am willing to pay higher fees when the volume is interesting enough. With these kind of rates I would expect bitstamp and bitfinex volumes. I'm very sorry, but it is just not very interesting anymore.

There is a rich set of literature in economics on two sided markets like currency exchanges are. It also contains a canonical model on how to set prices in these kind of markets. The details are very complicated and math-heavy. But the general idea is that the fees for each side of the market -- here buyer and seller or maker and taker -- should depend on the semi-price elasticity of the other side of the market. The reason is a what economists call adjacent complimentarity.

In human words: it is (mathematically) optimal for an exchange to charge different rates for makers and takers, since they react differently to prices. However, the  balance between the fees for each side is crucially important and in reality not easy to determine. If the gap is too wide that is worse than an identical rate for every side of the market.

edit: If you define the market price as the average between best sell and best buy offer, then the taker receives a worse price already. So this has to be kept in mind, when thinking about maker-taker fees. For example, in high volume markets with a low gap between best buy and best sell offer, the maker-taker fee difference should be greater than in a market with low volume (where there difference might even be negative, that is the taker having to pay less fees than the maker).

The other exchanges have to lower the fees, not you raise the fees.

that's no excuse, SEPA is free , that's the point of SEPA.  

It is okay, that you raise the fee a bit, but more than doubling is much to much!! And why do you raise them more for good volume customers?? Why?
Please think about that one more time and also the Maker-Taker thing!

Well, actually it is even more than from 0.11% to 0.23%, because your trading volume will go down when fees increase.

That sucks hard, yes. Still, kraken will then be on the level of bitstamp -- and btc-e becomes the cheapest of the major global exchanges. From the standpoint of kraken, this is a reasonable step.

Thanks for the feedback about our new fee structure. Just so it's clear, the new fee structure is explained here:

https://www.kraken.com/help/new-fees-info

We sent all clients an email about this. If you didn't seem to get it, please check your spam folder. (Our email provider inexplicably sent all the emails out in about 10 minutes when they should have gone out over the course of hours, so many of the emails may have been marked as spam.)

The email didn't address the fact that the new fee structure is a substantial increase for our national currency pairs. As I've already said above, this should have been addressed in the email and I apologize for this omission. We don't expect anyone to be happy about the increase - who is going to be happy about paying higher fees?

It's been so long now that probably it's been entirely forgotten, but our current fees were originally intended as an introductory rate. From the OP of this thread made back when we launched:


Instead of offering the discounted trading fees for a month or two, we've kept the discount going for almost a year. We understand if the discounted rate has been in place so long that it now seems like a standard rate. But in fact it's always been a discounted rate that isn't sustainable long term given the resources required to run an exchange.

Could we somehow slash our operating costs and make the current fees viable? Even if this was possible, it's never been our goal to operate a bare-bones exchange service. It's always been our goal to offer an exceptional exchange experience at a reasonable rate. The new fee structure may seem high compared to the current deeply discounted rate, but it's still very reasonable compared to many other exchanges. Remember that it's not just trade fees that matter. When evaluating the true cost of an exchange, you also have to consider other factors, such as the cost of depositing and withdrawing from your account. We still have the same low fees we've always had for depositing and withdrawing euros from your account (basically free for SEPA).  

Again, we always appreciate your feedback because we're always striving to better understand and meet your needs. There are of course limits, however, when it comes to fees. We're here for the long-term and we need to have a sustainable fee structure that better reflects the true costs of our services.

here you can see the limits and requirements:
https://bitcointalksearch.org/topic/m.4621645

With german bank accounts you have to be tier 3 and send an ID selfie to deposit. (just to say everything important, even if you are from poland)

This is not a good way I think. Please think about it again.
There are a lot of alternatives.

I was also a bit pissed when I read the email. Remember, your target group are intelligent people who are capable of doing some math so don't try these cheap marketing tricks on them. Who the fuck needs "fee credits"?

ok kraken! im out, put that new feesystem up your ass
kraken has been my #1 exchange before this...

it's more than doubling the fees !!  from 0,11% to 0,23%  with a volume a bit higher than 100,000$ a month. With no volume it's just from 0,2% to 0,35% so you punish the ones with good volume, are you insane?
That's NOT okay!! Why you do this??? What can we do, to stop this rubbish?

edit:
and don't say you have to raise the fees because of the high costs for support staff! You could save alot of work, if you do things right and tell everybody about all "on hold" things before the money is on hold!

Edit2:
Instead of doing this, you should make a "maker-taker" fee structure. Like all makers have to pay the same fee as it is now, and all takers have to pay higher fees (of course I wish you would lower the fees instead of raising them).

Hi Dargo,
Withdrawal ACCHWFK-RG6XSJ-HUFK2D.
I got my money today.

Thank you for all.

WTF, my fees are going to double?
i'll be moving to another exchange.
thanks for being there Kraken. Best wishes.

Hi ICFielder - thanks for your feedback and I think you make a good point. The improvement talk was intended to be directed at the simplified fee structure, not any fee increases. But I think it would have been better to address the increase head-on rather than to basically ignore it. I've always tried in this thread to talk very straight to people without any sugar coating, and I think that's gone a lot further with the community than any "marketing speak" might have. I assure you that I will take your point to our team and advocate for an adjustment in light of it. 

Kraken just sent out an email announcement on their fee structure:
 

Reads this: "Effective September 1st, 2014, we double our prices of trading. And in order to obscure that from our dumb customers we hand out some lollipops."

@Dargo and the kraken team: You do a very very good job with your site and I appreciate it a lot. If you need to increase your fees to finance all that, well, I am not happy about that but I understand it. However, I really do not like the way you communicate this decision. Especially when I read "better client experience"! Such words a red flag for me and probably many other bitcoiners. After all, the bitcoin market is still far from being one of those dumb consumer markets.

Hi Dargo,
CRO means Operative Code Reference. Each sepa has a different CRO. A customer, with the CRO number, is able to investigate if something goes wrong with the withdrawal.
If the kraken status "success" on the tab "witdraw" means that the SEPA has been sent, tomorrow (UTC +1) I could call my bank asking if FIDOR bank (I have the bank account data) has transmitted a swift message.
Thanks again for your replies.

Bitcoin withdrawals should be fixed now - let us know if you still have an issue. 

Hi hashman - we're in this game very long term, so we're taking the time to do everything with full legal compliance. We don't want to get shut down or slapped with a huge fine later on. Also, we're still working on going live with a solid banking partnership for USD. Both the regulatory and banking aspects are slow and unpredictable, so it's not something we can give a reliable ETA for. But I assure you that we are working to get operational in the US with USD funding as quickly as possible. 

Hi kitano - thanks for this suggestion. I'm not familiar with the term "CRO" but I assume it means something like a transaction reference code. I'll suggest the idea to our developers. It may not be available through Fidor's API and if so we couldn't offer it until Fidor offered it.   

Some bitcoin withdrawals are stuck and not getting broadcast to the network (it doesn't appear to be affecting everyone though). Thanks for your patience - we're working on the issue and will get it resolved ASAP.