Dreaming of offering crypto services but concerned about development complexities? White Label crypto wallet is a viable solution! These are the ready-made,multi-tested, and market-ready solution that expedites your market entry while preventing you from the hassles of developing a wallet from scratch. Behind the shining solution lies the fee trap that could erode the profits and frustrate the users. In this blog, we will highlight the top 6 White Label crypto wallet fees traps with effective strategies to minimize them :
Factors Affecting White Label Crypto Wallet Fees
1. Hidden Transaction Fees : Crypto transaction fees also known as gas fees are applied to process the transactions on the Blockchain network. These come in different forms discussed below:
- Deposit Fees : The fees are charged during crypto transfers from another source into the wallet. The fees rely on the network and the processing method (slow or fast) opted for you.
- Withdrawal Fees : Withdrawal fees are charged when cryptos are moved out of the wallet i.e. to another platform. This fee is higher than deposit fees, so transparency is vital.
- Transfer Fees : Transfer fees are charged when you move cryptos between different accounts of the same wallet. Determine the fee transfer structure to prevent surprises later.
2. Crypto Purchase : A user purchasing crypto via the wallet is supposed to pay crypto purchase charges. Furthermore, It is accompanied by spreads that must be disclosed and market-rate purchases must be offered to foster trust.
3. Trading Processing fees : You will charged fees for purchasing or exchanging cryptos as trading or processing fees. A small fee is applied on every trade carried on the platform or using a service utilized for resource improvement or sent as a reward to liquidity providers. The latter case applies to DEX exchanges and wallets that generate passive income by locking crypto into pools.
4. Inactivity Fees : Not everyone actively indulges in crypto trading. Certain wallets charge inactivity fees to the accounts that have been dormant for a specific time (like 3 months). This can be a surprise for those holding cryptos for a long time. It’s better to offer tiered or dormancy thresholds and inform these charges clearly to the users.
5. Account Maintenance Fees : Low-balance accounts are supposed to pay minor monthly or annual fees that add up over time. Get ins and outs of the fee structure offered by the provider and its impact on distinct accounts before investing in a solution.
6. Staking Fee Disparity : Users can earn rewards from their crypto holdings through staking. Certain wallet providers take a share out of these rewards. Make sure that you get complete clarity on staking fees before procuring the service. Determine the fee percentages and the way they are calculated.
Slashing White-Label Crypto Wallet Fees: A Multi-Pronged Approach
White Label crypto wallet fees can impede user’s experience but here is how they can save big :
1. Partnering for Efficiency : Hire a White Label crypto wallet development partner that offers cost-effective options. Consider options like batching transactions, dynamic fees selection, and Layer 2 integrations for quicker and more economical processing.
2. User Education is Key : Inform the users about the gas fees directly and empower them. Include educational resources within the wallet application. Highlight everything about network congestion and how it impacts the cost. Also, state the importance of off-peak hours resulting in lower costs.
3. Optimizing Your Fee Structure : Negotiate fee structure with the provider to align it with your business model and target audience. Make sure that you charge minimum internal transfer fees, navigate tiered structures, and provide transparent spreads on crypto purchases to prevent charges later.
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