A lot of cryptocurrency platforms have started to introduce fees for Bitcoin withdrawals. That is only normal, considering the transaction fees are on the rise. LocalBitcoins, however, is introducing deposit fees all of a sudden. This is rather significant, to say the least. Sending funds from the platform has become cheaper, though. This is a very strange decision by the company, to say the least.
LocalBitcoins Deposit Fees are a Thing Now
It is rather remarkable to see how the cryptocurrency world is evolving these days. Many platforms have introduced withdrawal fees. With the Bitcoin network fees rising, this decision is not entirely surprising. However, no platform has introduced Bitcoin deposit fees as of yet. Or that was the case, until LocalBitcoins decision to make this rather unexpected decision. As of June 19th, all LocalBitcoins users will be forced to pay a fee to deposit Bitcoin.
Until recently, the only fee associated with LocalBitcoins came in the form of a fee to move funds off the platform. This cost is used as a way to pay miners for including the transfer in the next network block. Deposit fees will mean customers making small deposits will pay a larger share of overall costs. Those looking to move funds out of LocalBitcoins will enjoy lower fees. It is a rather interesting concept, to say the least.
What is even more interesting is how deposit fees will be dynamically adjusted. Said adjustment will occur based on how congested the Bitcoin network is at any given time. It is believed the deposit fees will be three times higher compared to regular fees. As the network becomes more congested, it will become increasingly expensive to move Bitcoin to LocalBitcoins. That is not necessarily a good thing for the company, though.
Rest assured a lot of people will not be too happy about this decision by any means. Paying more money to move bitcoin to a specific platform is never a fun experience. It cuts into sellers’ profits by quite a bit. On the other hand, this may further inflate the Bitcoin price on LocalBitcoins as well. A lot of sellers will pass along the deposit fee to potential buyers, for obvious reasons. It will be interesting to see how things play out for LocalBitcoins moving forward.
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