Network fee is killing my small profit - page 4.

sayulita

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Quote from: Little Mouse on July 31, 2020, 08:08:10 PM

I have started to buy BTC and sell them in a higher price (in BDT). For example, imagine I have purchased $100 worth of BTC @86BDT per USD and sold them instantly @87BDT per USD. This is a good business even if you take 1BDT per USD profit. I was having some good profits each day.
But now after the fee has increased, it has been impossible to get profit. There's a transaction cost which I can not avoid and it is very high. I trade small amount like $50 even (To make a strong hub). In such cases, I have no profit almost unless I'm dealing $300 or over. That's a pain to pay such fee but I have no way because I do not make a bad relation with buyers and sellers.

The same case is with the Ethereum flash loans as well, you don't have any chance to make a decent income by doing arbitrage trade on the flash loan websites, if you are having the low entry point of 1ETH then there is mostly a fees of $15 for doing that flash loan transaction but the problem is that in most of the cases the profit margin is less than $15 per transaction and if you increase the flash loan amount then also you will be getting less number of coins in the same price as you were getting for 1 ETH.
This situation is also the same, this is also one of the problems that can actually be solved by the lightning network, but then a lot of people will do the same thing as you are trying to do so, less margin per trade for you.

Shasha80

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It looks like you are doing a P2P transaction, because Bangladesh is banned Bitcoin so it is impossible to use local
centralized exchanges. If it's like that it's only natural that the network fee is big, if it's like that the solution as you
say has to deal with $ 300 or more. This is the best solution in my opinion.

Haunebu

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There are multiple solutions to your problem op because high network fee has always been an issue with the BTC blockchain based on what I observed.

One solution is selecting the lowest fees possible even if the TX time increases drastically. You could then proceed to use free TX accelerators through different sites or services here on Bitcointalk.

Another solution is trading with alternate cryptocurrencies like LTC, Dogecoin etc whose fees are usually negligible at any point of time. Final solution is simply trading with big amounts like you mentioned since $300 is not really huge.

thesmallgod

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Quote from: Little Mouse on July 31, 2020, 08:24:58 PM

Mate, BDT is the fiat currency of Bangladesh. I used to buy sell BTC locally to make some profit since I have both some buyers and sellers. And there's no way you can get rid of the high fee now. Coinbase is better since they use batch payment now and fee is proportionally low but it's very risky to use coinbase for such trades because the source of BTC can be illegal too.

except your learn and use the bitcoin lightning network, there is no shortcut to this for now. The fee will continue to go higher as the price of bitcoin do. I sell for fiat through a local exchange also here in my country and I can see that the method adopted by most of these local exchangers now in order to mitigate the effect of the high fee is that they have increased their minimum order. some wallet also allow you to use custom policy fee so you can set the transaction fee to the lowest but confirmation time will be longer.

snipie

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Quote from: brightemo on August 01, 2020, 02:50:05 AM

You will be able to make real profits only with big deposit, sorry

No he actually can make profits with small amounts too. It only depends on the way he uses. I am aware of people trading that way but directly. For example, $50 = 0,0043 BTC. I will send to my client that amount using a wallet that allows me to select fees (satoshi/byte) so that client might wait long to get his funds (not necessarily of course). Or else, I will sell those 0,0043 BTC for him with $53 (or $50+fees) if he wants his funds faster.

LogitechMouse

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The only solution (not solution really) to this very high network fees is to just increase your total capital since you said that you are buying and selling Bitcoins.

Right now there is nothing we can do about it. I have some funds in an gambling site too and right now the withdrawal fees there is very high that I can't tolerate it unless I will withdraw once a month or 2 months. Maybe buying another coin will help you or just buy and sell ETH or LTC or XRP instead of BTC. Lower fees = higher profit Cheesy

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Kez1817

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Quote from: Little Mouse on July 31, 2020, 08:08:10 PM

I have started to buy BTC and sell them in a higher price (in BDT). For example, imagine I have purchased $100 worth of BTC @86BDT per USD and sold them instantly @87BDT per USD. This is a good business even if you take 1BDT per USD profit. I was having some good profits each day.
But now after the fee has increased, it has been impossible to get profit. There's a transaction cost which I can not avoid and it is very high. I trade small amount like $50 even (To make a strong hub). In such cases, I have no profit almost unless I'm dealing $300 or over. That's a pain to pay such fee but I have no way because I do not make a bad relation with buyers and sellers.

You know we have nothing to do about the fees because if the value of bitcoin increasing the transaction fees are also increasing. So,i think the only solution is to sell for a little bit higher so that you can save even a small profit then if you are going to cash out if ever much better to wait another deep so that the fees is a little bit smaller.

brightemo

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You will be able to make real profits only with big deposit, sorry

dothebeats

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Make it P2P trades and just use lower fees? I get the there is a time constraint when using lower fees for transaction but it's the only way around it currently. Or you can use LN to facilitate your transactions for faster exchange. If crypto trading isn't really illegal and your customers or whatever are registered in a crypto exchange, trading it with another crypto like ETH or XRP only for transactions will also do the trick, though that might slightly affect the values of the money you are sending and receiving so better act fast.

pooya87

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Quote from: anu1908 on August 01, 2020, 01:01:18 AM

it's kinda hard for me to imagine the way you trade, since if you trade on an exchange for example then you don't need to withdraw to scalp it everyday. if it's on p2p, why not ask the buyer to cover the fees? or simply wait for the fee to come down to make any deal.

since he said he is from Bangladesh and last time i checked bitcoin was illegal over there, it must a P2P trade which means they are sending on-chain transactions and are suffering from the high fees.
although in this case one thing may be in OP's favor and that is the spread between sell price and buy price which happens in cases like this (illegality of bitcoin or even simply low number of P2P traders). that is something he might want to look into, you basically buy at a much lower price from sellers and sell back to buyers at a much higher price. i have seen spread as big as 10% and that can cover the fees by a lot.

avikz

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Quote from: Little Mouse on July 31, 2020, 08:08:10 PM

I have started to buy BTC and sell them in a higher price (in BDT). For example, imagine I have purchased $100 worth of BTC @86BDT per USD and sold them instantly @87BDT per USD. This is a good business even if you take 1BDT per USD profit. I was having some good profits each day.
But now after the fee has increased, it has been impossible to get profit. There's a transaction cost which I can not avoid and it is very high. I trade small amount like $50 even (To make a strong hub). In such cases, I have no profit almost unless I'm dealing $300 or over. That's a pain to pay such fee but I have no way because I do not make a bad relation with buyers and sellers.

It's high time for you to move to Lightening Network. Since you trade small amounts of bitcoin, LN will help you to bypass the high transaction cost. There are plenty of LN wallets available for you to use. See below,

https://lightningnetworkstores.com/wallets

Choos3 the best wallet as per your requirement and you are all set. Segwit can't help here because the network activity has increased due to the sudden surge in price. LN is immensely helpful for small amount trading. You transaction fees will come down to cents.

anu1908

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it's kinda hard for me to imagine the way you trade, since if you trade on an exchange for example then you don't need to withdraw to scalp it everyday. if it's on p2p, why not ask the buyer to cover the fees? or simply wait for the fee to come down to make any deal.

ranochigo

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Try switching to an exchange that absorbs the fees (Gemini) or exchanges that charges lesser TX fees either with segwit or batch payments. It is an inevitable problem given that you're transferring Bitcoin/fiat back and forth regularly. Good news is, the network fees are getting lower right now.

Jawhead999

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Quote from: michellee on July 31, 2020, 11:58:37 PM

If you only search for 1 BDT for the profit, I think you are hard to profit. But if, for example, your need to search for more than 5 BDT, I think that will cover your fee in trading. Let say you buy at @86 BDT then you should sell bitcoin at 91 BDT (sorry, if I am mistaken).

What if you buy at @1 BDT and sell it at @1000 BDT, actually you will become billionaire now Roll Eyes

I think everyone already know how to profit from trading (buy low, sell high). In this situation OP is buy bitcoin and sold it instantly to customer like an exchanges, if OP raise the price much more to get profit... actually the customer will not buy from him again and will buy it thought exchanges since it's more cheaper.

Segwit, batching and lightning network only the solution regarding this scenario... there's no other way to cut the fees.

This is not a good time to buy and sell instantly since bitcoin price is increase right now. Since the price is increase, it also increase in adoption and transaction everyday... make the fees more expensive.

bolawin

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You need bigger fund to make a profit, little money give little profit to none.

michellee

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If you only search for 1 BDT for the profit, I think you are hard to profit. But if, for example, your need to search for more than 5 BDT, I think that will cover your fee in trading. Let say you buy at @86 BDT then you should sell bitcoin at 91 BDT (sorry, if I am mistaken).

Example in USD. You buy bitcoin at $11,200, and you should sell bitcoin at $11,300 or more, so your profit will be bigger than your fees. I had those experiences when I tried to use little money to trade bitcoin pair fiat, and I found out that trade fiat pair altcoin will be better if you don't have big cash or can trade bitcoin pair altcoin.

Strongkored

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You can charge the transaction fee to the buyer (and chances are the buyer will complain about this)
Or you can specify a minimum transaction to reduce fee(even this is risky, which means you cannot serve buyers in small quantities).
I think apart from that nothing can be done and the amount of transaction fees has been a discussion at all times.

romero121

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Quote from: Little Mouse on July 31, 2020, 08:24:58 PM

Mate, BDT is the fiat currency of Bangladesh. I used to buy sell BTC locally to make some profit since I have both some buyers and sellers. And there's no way you can get rid of the high fee now. Coinbase is better since they use batch payment now and fee is proportionally low but it's very risky to use coinbase for such trades because source of BTC can be illegal too.

This means not the trading on exchanges. You do trade with different buyers and sellers at a very minimal profit. In short you buy for a less price and sell it a little above the buying price. Repeated trading gives good profit, and I need to ask a question. Is it legal to trade cryptocurrency within Bangladesh. I read an article where a person using bitcoin is arrested by policemen.

batang_bitcoin

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I understand your problem and with the little profit you are getting, the network fee is such a burden. I think what you can do is adjust also your interest putting for each sale you get or tell your customers that they have to shoulder the fees alone or you'll both shoulder it.
I think that's the remedy that you can do if the network fee surges.

tranthidung

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Quote from: Little Mouse on July 31, 2020, 08:24:58 PM

Mate, BDT is the fiat currency of Bangladesh. I used to buy sell BTC locally to make some profit since I have both some buyers and sellers. And there's no way you can get rid of the high fee now. Coinbase is better since they use batch payment now and fee is proportionally low but it's very risky to use coinbase for such trades because source of BTC can be illegal too.

Two factors and I would like to ask you:

Where is the place you use to trade? BTC is in your non-custodial wallet or in your account on third-party platform?
When you moved your btc in your trades?

More explanations:

^[1] I guess you trade with your trade partners on a third-party platform so that you are not allowed to choose your prefered fees for transactions (most of platforms don't allow customers do so).

^[2]I guess it is yesterday or days before yesterday so you chose wrong days to move your BTC. Fee is high for now but as confirmed weekend effects (from institutional effects) the mempool has decreased recent hours ^{check it with the Joehoe site}and I expect to see lower fees and smaller size in mempool tomorrow, about 28 hours from now. Maybe you won't be able to move your bitcoin at 1 satoshi/ byte this Sunday (as previous weekends) but fee will be cheaper tomorrow.

Bitcoin transaction fees (in sats/kb). Sunday, Saturday are best to move BTC
Johoe site (unconfirmed transactio count, pending transaction fee, mempool size - all have decreased recent hours.

Topic: Network fee is killing my small profit - page 4. (Read 873 times)