How to calculate DigiFinex contract transaction fees

DigiFinex contract transaction fees are based on the contract's notional value, which is the product of the contract size and the underlying asset's price.

Nov 26, 2024 at 04:10 am

How to Calculate DigiFinex Contract Transaction Fees

Understanding DigiFinex Contract Transaction Fees

DigiFinex, a leading cryptocurrency exchange, offers perpetual contracts for various cryptocurrencies. These contracts allow traders to speculate on the future price of the underlying asset, Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH), and EOS. DigiFinex charges transaction fees for closing and opening contracts, which vary depending on the market conditions.

Calculating DigiFinex Contract Transaction Fees

Step 1: Review the Fee Schedule

DigiFinex provides a detailed fee schedule for its contract trading services, accessible on the exchange's website. The fees are calculated based on the contract's notional value, which is the total value of the underlying asset.

Step 2: Calculate the Contract's Notional Value

The notional value is crucial for determining transaction fees. It is calculated as the product of the contract size and the underlying asset's price:

Notional Value = Contract Size x Underlying Asset's Price

For example, if you are trading a BTC contract with a contract size of 1 BTC and the current price of Bitcoin is $10,000, the notional value would be $10,000.

Step 3: Determine the Transaction Type

DigiFinex charges separate fees for opening and closing contracts:

• Opening Fee: Charged for opening new contracts, it is a percentage of the contract's notional value.
• Closing Fee: Charged for closing completed contracts, it is also calculated based on the contract's notional value but at a different rate.

Step 4: Calculate Transaction Fee

Using the fee schedule provided by DigiFinex, you can calculate the transaction fee for opening or closing a contract. The fee is a percentage of the notional value, which varies according to the market conditions.

Transaction Fee = Notional Value x Fee Percentage

For instance, if the fee for opening a BTC contract is 0.02%, and the notional value is $10,000, the opening fee would be $2.

Step 5: Factor in Additional Costs

Besides the DigiFinex contract transaction fees, you may encounter other associated costs, such as:

• Funding Rate: A periodic payment made to long or short positions, depending on market conditions, to maintain the fair value of the contract.
• Settlement Fee: A fee charged upon the settlement of a perpetual contract, which is typically a small percentage of the contract's notional value.
• Margin Interest: If you're using margin trading, you will incur interest charges on the borrowed funds, which can impact your overall trading costs.

By following these steps and considering all relevant factors, you can accurately calculate the DigiFinex contract transaction fees for your trading activities.