The costs involved
- Author
- CRYPTO PORT Editorial
- Published
- Updated
- Reading time
- 6 min
In short
Fees are not the whole cost. There is the spread between the buy and sell price, deposit and withdrawal charges, on-chain transfer fees, and tax on any gain. In the normal case you are below your purchase price from the moment you buy.
Key points
- The spread is not labelled as a fee but is a real cost
- Moving yen in and out can carry charges of its own
- On-chain transfer fees vary with network congestion
- A gain brings a tax liability with it
Definition
Everything actually deducted along the path from acquiring a crypto asset to selling and withdrawing — both the fees shown to you and the costs absorbed into the price.
The hardest cost to see is the spread. On brokerage-style services the price to buy and the price to sell differ, and that gap is the provider's revenue. Even where the screen says zero commission, buying and immediately selling leaves you down by the gap. It varies by asset and provider, so get into the habit of reading both the buy and the sell price on the same screen.
Then deposits and withdrawals. Funding in yen can carry a charge depending on the method, and withdrawals normally do. Move small amounts frequently and these fixed costs become a large proportion of the total.
Sending crypto out to another address adds a network fee. That one goes to the blockchain, not the provider, and it moves with congestion. At busy times the fee can exceed the value you are sending.
Finally, tax. Gains on crypto transactions in Japan are in principle classified as miscellaneous income and may require a filing. Rates and filing thresholds depend on your overall income and on rules that get amended, so this page gives no figures. Check the National Tax Agency's guidance and consult a tax professional if you are unsure.
Watch out for
- · 'No commission' does not mean no cost once the spread is counted
- · Tax comments here are a general orientation, not tax advice
- · After costs, it is entirely possible never to recover what you paid
Frequently asked questions
How do I keep costs down?
Fewer trades and fewer transfers, mainly. But lowering costs is not the same as making money — treat the cost structure as input to the decision of whether to start at all.