The Real Cost of Converting Crypto to Cash, Measured
Four providers, identical sales, with spread, withdrawal fee and currency margin separated and measured.
We sold identical amounts at four providers within the same window and measured every component of the cost.
What we measured
The spread: mid market price at quote against the rate offered.
The withdrawal fee: stated.
The currency margin: the rate applied on conversion against the interbank rate at the moment, where a conversion occurred. For the tests below we used a crypto to fiat exchange as the reference, because it publishes the figures we were measuring against.
The results, as percentages of the amount sold
Provider A: spread 0.18%, withdrawal fee 0.004%, no conversion. Total 0.18%.
Provider B: spread 0.31%, withdrawal fee 0.004%, no conversion. Total 0.31%.
Provider C: spread 0.22%, withdrawal fee 0.07%, conversion margin 1.15%. Total 1.44%.
Provider D: spread 0.94%, withdrawal fee 0.01%, no conversion. Total 0.95%.
What the numbers show
Provider C had the second best spread and the worst total, entirely because of the currency conversion.
Provider D had no conversion and still cost five times Provider A, because the spread was wide and invisible.
Neither of those facts is discoverable from a fee page.
The conversion trap
Property settlement is a separate corridor, and an exchange that publishes its full fee schedule operates in it.
Provider C settled in euros and our account for that test was in another currency.
We repeated the test with a euro account and Provider C came in at 0.29 percent, competitive with the others.
Same provider, same sale, five times the cost, decided by which account received it.
Measuring the spread yourself
Note the mid market price when you request a quote. Compare against the rate offered. Two minutes.
This is the only component nobody discloses as a fee, and on three of four providers it was the largest component.
The withdrawal fee is noise
Between two euros and thirty-five euros on the amounts we tested, which is under a tenth of a percent in every case.
People compare withdrawal fees and ignore the spread. It is backwards.
What we would do
Open an account in the currency the provider settles in. That alone removed the largest cost we measured.
Then measure the spread across two providers on the same day, twice, and use the tighter one.
Providers that publish settlement currencies and can settle crypto to fiat without a conversion leg are the ones where this problem does not arise, which is worth more than a few basis points on the spread.
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