Update Nov. 11, 2022: FTX, the parent company of FTX.US, has filed for Chapter 11 bankruptcy as of Nov. 11, 2022. According to the company (as of Nov. 10), account withdrawals from FTX.US are still live, but trading may be halted in a few days, so the company advises clients to close any positions that they intend to close.
FTX.US offers a solid way to trade cryptocurrency, especially for those able to take advantage of its volume discounts. FTX – which we’ll use here to refer to the U.S. operation rather than the global outfit – lets you trade a couple dozen crypto coins and offers its own non-fungible token (NFT) marketplace, a relative rarity for a crypto exchange. FTX also enables margin trading for qualified accounts, allowing you to purchase more crypto than you actually have the cash for and helping you to magnify your gains (and losses). However, FTX does not offer staking rewards for traders and the cryptocurrency selection is admittedly narrow, at least for the moment.
Those looking for a wider selection of cryptocurrencies should have a look at Binance.US and Coinbase. Those who are interested in trading crypto alongside more traditional securities such as stocks may want to take a look at Webull, which lets you invest in a respectable number of crypto coins, more than the usual handful that most traditional brokers allow.
Best for
- Crypto-only traders
- Active traders
- Crypto-to-crypto trading
FTX.US at a glance
| Minimum balance: | None |
| Securities tradable: | 24 cryptocurrencies |
| Cost per trade: |
|
| Customer service: | Self-help, support tickets, email and live chat through Telegram, Instagram and Facebook |
| Mobile app: | The FTX.US mobile app is available on the Apple App Store and Google Play Store |
Pros: Where FTX stands out
Commissions
Like many other crypto exchanges, FTX uses a volume-based, maker-taker pricing structure, which can offer especially favorable pricing to those who generate serious volume or who offer liquidity to the exchange (makers). Those who reduce liquidity (takers) are charged a somewhat higher fee.
FTX divides its pricing structure into nine different tiers based on traders’ 30-day trading volume as follows:
| 0 – $100,000 | 0.10 percent | 0.40 percent |
| $100,000 – $500,000 | 0.08 percent | 0.30 percent |
| $500,000 – $1 million | 0.06 percent | 0.20 percent |
| $1 million – $5 million | 0.05 percent | 0.15 percent |
| $5 million – $10 million | 0.04 percent | 0.10 percent |
| $10 million – $15 million | 0.03 percent | 0.08 percent |
| $15 million – $30 million | 0.02 percent | 0.07 percent |
| $30 million – $50 million | 0.01 percent | 0.06 percent |
| $50 million or more | 0 percent | 0.05 percent |
So if you make a $50,000 trade, say, in a 30-day window, you’re in the lowest tier and would pay a commission of $50 at the maker level and $200 at the taker level.
The commissions for makers are good and compare well to Binance.US, one of the lowest-cost exchanges around. When you get to some of the nosebleed levels – $10 million and up – Binance does a bit better than FTX, charging no commissions for makers.
On taker commissions, though, FTX is less competitive. For example, the most expensive tier there for Binance is 0.10 percent, compared to 0.40 percent at FTX. But it still does beat out Crypto.com’s rates at higher levels, though Crypto.com is better at lower volumes for takers.
Many rivals have discounted rates kick in at lower levels than FTX does. For example, the first discount might kick in at $25,000 and some have another discount start at $50,000 and then the third tier comes in at $100,000 – all before FTX traders have seen their commission discounted at all. Again, that might matter more for takers than makers, who already enjoy lower rates here.
Margin trading
FTX enables margin trading for crypto traders, allowing them to borrow money from the exchange and purchase more cryptocurrency. Margin trading magnifies your returns regardless of their direction: if your trade is profitable, it will generally be more profitable with margin; if it’s a loser, then you’ll lose even more when you’re using margin. Regardless, FTX is one of the few exchanges that allow you to use margin when trading crypto, though margin loans are standard practice in stock and foreign exchange markets.
But margin trading in crypto is akin to pouring gasoline onto a roaring fire. The volatility of crypto alone is breathtaking, but when you pour margin onto that, it can really explode your portfolio. On top of that, FTX allows you to use margin very aggressively, so you may be able to borrow many times the equity in your account. Therefore, traders run the risk of losing their investment – and potentially even more than they’ve invested – if the markets gyrate too much.
You’ll need at least $100,000 in equity in your account to take advantage of margin trading. You’ll be charged for your holdings every hour, at 1/24 of the daily rate. FTX provides you estimates on the hourly borrow rate for the borrowable securities, so you can see the costs.
Of course, you don’t have to use margin unless you’re inclined to. But for those who want to take their chances, margin trading is a possibility here.
NFT marketplace
In addition to its crypto trading operation, FTX also lets you buy and sell NFTs. These digital assets, including art, images, collectibles, sports clips and more, captured the trading public’s fancy in 2021, and FTX is one way to get in on that market. The ability to sell NFTs with crypto exchanges is not especially common, so FTX offers something distinctive here.
Clients can buy or sell NFTs, and even list their own creations on the site for a $1 fee per listing.
Cons: Where FTX could improve
Confusing transfer fees
Many crypto exchanges don’t charge clients for moving U.S. dollars into or out of their account, but FTX both does and does not charge for transfers. Confusing? Yes, indeed! Here’s what’s up.
FTX charges a standard $0.50 fee for ACH deposits (which nearly every major competitor allows for free). However, it allows you to dodge this fee if:
- You’ve never made an ACH transfer there before.
- You haven’t deposited via ACH in the last week and the transfer is more than $10.
- You have deposited via ACH in the last week and the transfer is more than $100.
Does the cost of $0.50 matter in the scheme of things? Of course not. But the same logic should apply to the exchange’s pricing, too. Why is it wasting time on the fee and then creating all these loopholes to it? It’s just a confusing welter of rules and exceptions for customers to navigate.
Although FTX doesn’t currently charge a fee for deposits via wire transfers (as of January 2022), it strangely lists a fee structure that “reserves the right” to charge one in the future. That fee would be 1 percent, with a $5 minimum and a $35 maximum.
FTX does not charge deposit fees for cryptocurrency for blockchain transfers. On NFT trades, it charges a 2 percent fee to the seller on every sale or trade.
Cryptocurrency selection
FTX offers just 24 individual cryptocurrencies, a somewhat-thin selection in the crypto world. So you’ll want to check carefully if FTX meets your needs here. It offers the biggies such as Bitcoin and Ethereum, as well as up-and-comers like Solana and Dogecoin. That said, if the selection includes the coins you want to trade, then it doesn’t matter how narrow the range.
Traders looking for a broader selection of coins should have a look at Crypto.com (with more than 250 kinds of crypto) as well as Bittrex, which offers more than 100 different coins.
No staking rewards
If you’re looking for staking rewards on your cryptocurrency, you’re out of luck at FTX. You’ll get none. That may not be too surprising, given the exchange’s focus on courting clients who might be interested in margin trading and transacting in high volumes. Staking rewards allow you to earn income on your crypto position as your stake supports a crypto’s validation system.
If staking rewards are a must for you, then you might check out Crypto.com, Binance.US or even Bittrex, though the latter offers staking on just one coin (Cardano), as of last report.
Customer support
As at many crypto exchanges, you shouldn’t expect much, if any, phone support at FTX. That won’t put FTX at any disadvantage since the usual methods of support are support tickets and a self-help FAQ on the website. FTX goes a bit beyond the usual, with a live chat capability via Telegram, Instagram and Facebook.
That’s certainly better than many rivals, but it’s still well below the level of support that customers of established brokerages such as Charles Schwab and Fidelity Investments have come to expect. There, you could be on the phone in under a minute with a human who can sort out your situation and have you on your way. At FTX, you might not even have finished typing out your issue in that one minute.
Bottom line
FTX offers numerous potential advantages to customers looking to trade cryptocurrency:
- Its attractive commissions structure for makers and high-volume traders should be enticing to those traders, though FTX is much less favorable to low-volume takers.
- Margin trading may prove a draw to crypto traders who want to pile on even more risk than crypto already presents, as they aim for stratospheric returns.
- However, those looking for staking rewards on cryptocurrency will not find that option here and will need to look elsewhere.
Active crypto traders should also have a look at Binance.US, the U.S. arm of the larger Binance organization, and Kraken. If you want to trade stocks and options along with crypto, tastyworks makes a compelling option with a commission capped at $10. TradeStation is another fine option if you want to drive down commissions drastically.
Update Nov. 11, 2022: FTX, the parent company of FTX.US, has filed for Chapter 11 bankruptcy as of Nov. 11, 2022. According to the company (as of Nov. 10), account withdrawals from FTX.US are still live, but trading may be halted in a few days, so the company advises clients to close any positions that they intend to close.
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