As crypto emerges as the new gold mine in the crypto sphere, crypto traders are looking for the best crypto exchange to trade crypto with leverage.
Binance and FTX are two of the most popular crypto derivatives exchanges in the world. Binance is the leading cryptocurrency exchange in the world in terms of spot and derivatives trading volume. On the other hand, FTX is a pure derivative trading exchange and ranks among the top fifth-largest crypto assets exchange.
Both exchanges share numerous similarities and a few differences. However, those differences can be the key to selecting the right derivatives exchange.
Today, we’ll compare FTX and Binance on multiple areas, such as offerings, fees, security, platform capabilities, and more. By the end of this Binance vs. FTX comparison, you’ll be able to determine which is the best crypto exchange in the market for trading cryptos.
|💰 Supported Pairs||39||189|
|🚀 Maximum Leverage||20x||20x|
|⚖️ Taker Fees||0.07%||0.04%|
|🔧 Maker Fees||0.02%||0.02%|
|💳 Supported Deposit Methods||Wire, Credit Card, and Crypto||Wire, Credit Card, and Crypto|
|🎁 Joining Bonus||5% Off on Trading Fees||N/A|
FTX Vs. Binance: Futures Contracts & Leverage Offerings
Both FTX and Binance offer a wide range of cryptocurrency assets. However, FTX is purely a platform for trading crypto derivatives and provides the following products:
- Futures: 150+ perpetual futures contracts or perpetual swaps with the quarterly expiry futures market
- Options: Bitcoin options contracts
- Leveraged Tokens: Leveraged positions with up to 3x leverage on 45 different ERC-20 tokens
- MOVE: MOVE contracts (unique FTX offering) with daily, weekly, and quarterly expiry
FTX provides up to 101x leverage; however, you can adjust the leverage amount to 50x, 100x, or 101x per your market trading preferences.
…read our detailed FTX review to know more about the platform.
Binance offers the following crypto markets products:
- USDT-M Futures: Perpetual and quarterly futures contracts settled in USDT with 20-125x leverage
- COIN-M Futures: Perpetual futures contracts settled in crypto with up to 125x margin
- Binance Leveraged Tokens: Tradeable assets on the spot market with 1.25-4x leverage
- Binance Vanilla Options: European-style options contracts settled in USDT
Verdict: It’s a tie. Both Binance and FTX offer multiple products, trading pairs, and higher leverage.
Binance vs. FTX Trading Fees
FTX doesn’t charge any deposit and withdrawal fee. Also, there are no fees on futures settlement. However, the exchange charges a daily management fee of 0.03% and a creation and redemption fee of 0.10% on leveraged tokens.
Both exchanges charge fees based on market makers and market takers. Market makers are those who add depth and liquidity to the market, while market takers are those who take away depth and liquidity.
FTX deploys a tiered fee structure for the Futures & Options (F&O) segment. The fees are volume-based and depend on the 30-day trading volume. Traders are categorized into various levels based on their market trading volume in 30 days.
FTX has six trading tiers. For those with a 30-day trading volume of less than 2 million USD (Level 1), the market maker fee is 0.020%, and the taker fee is 0.070%. The fee reduces as the market trading volume, and thus, the tier increases.
Additionally, the trading fee increases with an increase in leverage. For up to 50x leverage, the fee increases by 0.02%. For up to 100x leverage, it increases by 0.03%.
If you have an FTT token, you can get a discount of 3-60%. And further more 5% discount on trading fees by using FTX promo code during singing up.
Binance, on the other hand, has a flat fee structure. As a result, each trade carries a standard fee of 0.1%. However, you can waive that fee by using Binance Coin (BNB) to pay your trading fee.
Like FTX, Binance also has a tiered fee structure based on 30-day trading volume. There are ten tiers – VIP 0 to VIP 9. Those with a 30-day volume of less than 250 BTC or BNB balance equal to or below 0 BNB are categorized as VIP 0 traders.
The market maker and taker fees for VIP 0 level are 0.02% and 0.04%, respectively. However, if you use BNB coin, the market maker and taker fees reduce to 0.018% and 0.036%. Again, the fees decrease as your trading volume and BNB balance increase.
Verdict: FTX fees are lower, and thus, it’s the clear winner.
FTX Vs. Binance Funding Fees
Every derivatives exchange has a funding rate to ensure that the price of derivatives products stays close to the market index price.
When the funding rate is positive, which means the price is above the index price, long traders pay a funding fee to short traders. The opposite happens when the price is below the index price.
FTX and Binance use different mechanisms to calculate funding rates. FTX calculates the funding payment as follows:
- Position size x (TWAP of the futures contract– TWAP of the index) / 24
Binance calculates the funding fee as follows:
- Premium index + clamp (Interest rate – Premium index)
The interest rate is fixed (0.01%), and the premium index changes every hour. Thus, the funding fee also changes every hour.
While the funding rate on both FTX and Binance fluctuates, the past 30-day average funding rates are 0.013% for FTX and 0.028% for BTC.
Verdict: FTX has a lower funding rate (30-day average), and thus, is the winner.
Binance vs. FTX Deposit & Withdrawal Fees
Cryptocurrency deposits are free in both FTX and Binance, and only blockchain fees are payable. In addition, both exchanges don’t impose any limit on depositing crypto to the trading account.
However, Binance charges withdrawal fees, which can vary depending on the asset. For instance, the Binance withdrawal fee for Bitcoin is 0.0000058 BTC. On the other hand, FTX doesn’t charge any withdrawal fee from its users.
Both FTX and Binance have a take-profit limit and crypto withdrawal amount limit based on KYC levels.
Verdict: FTX is the winner as it doesn’t charge any deposit and withdrawal fee.
FTX Vs. Binance Trading Platform Comparison
Here’s a head-to-head comparison between FTX and Binance platforms
FTX offers a comprehensive range of features and functionalities while ensuring ease of use and a seamless user experience. Its user interface is professional yet easy to use, making it ideal for everyone in the market, from institutions to individuals.
The exchange supports all types of orders, such as market order, limit order, stop-loss order, take profit order, and more. In addition, the charting window has advanced indicators, screeners, and trading tools to help improve your trading proficiency. With FTX, you can also set up algo trading bots.
Binance also has an advanced and intuitive trading and charting platform that comprises all the essential features. In addition, it comes with multiple chart types and indicators.
However, it lacks some advanced features an exchange in the market should offer, such as setting up algo trading bots. This could be a dealbreaker for experienced traders and institutions.
Verdict: FTX has a slight edge over Binance as its crypto trading platform has more features and is better suited for professional traders.
Binance vs. FTX: Account Opening Process
Both FTX and Binance offer a seamless account opening process. You can go to their website and sign up to create an account and start trading. However, please note that both crypto exchanges have tier-based KYC requirements.
- FTX KYC Requirments
FTX has three tiers of KYC requirements. In Tier 0, FTX users only need to give their email and ensure that they aren’t from a restricted jurisdiction. In addition, tier 0 KYC accounts have a lifetime withdrawal limit of USD 1000.
- Binance KYC Requirements
Binance also enables you to open an account using your email address. You can deposit, trade, and withdraw up to 2 BTC per day without the need for KYC. However, for amounts greater than 2 BTC, a KYC is required. You can also do spot trading without KYC.
Verdict: Both FTX and Binance allow you to open a free account and start trading without a KYC. Hence, it’s a tie.
From United States? Here are our top picks of Leverage Trading Platforms for USA citizens.
FTX Vs. Binance Customer Support
Both FTX and Binance have a dedicated customer support team and provide a stellar customer experience.
FTX’s customer support team provides support over the phone, email, helpdesk tickets, Medium, Twitter, Facebook, WeChat, Telegram, and YouTube. They provide support documents to help you kickstart your trading journey. FTX also has an excellent community of intermediate and helpful traders.
Binance, like various platforms, offers customer support over live chat, Facebook, Twitter, Reddit, Weibo, Instagram, Telegram, VK, and YouTube.
However, Binance doesn’t provide phone support. Binance also has a huge community and provides support docs. However, FTX’s support docs are more comprehensive and well-organized.
Verdict: FTX provides phone support while Binance doesn’t, making FTX a better crypto exchange in customer support. FTX also has better support docs to help you get an edge in the take-profit market.
Binance vs. FTX Security Features
Both FTX and Binance offer robust security features to ensure the safety and security of your account and funds.
Here’s a quick dive into FTX security features
- Two-factor authentication (2FA) requirement
- Withdrawal lock of a password change or 2FA removal
- Subaccount functions
- Whitelisting IPs and wallet addresses
- Chain analysis and manual review
- Insurance funds to manage sudden volatility
Binance has similar security features, including:
- Two-factor authentication
- Device management
- Wallet address management
However, Binance has been hacked once in May 2019, when hackers stole over $40 million worth of cryptocurrencies from the users’ accounts.
A successful cyberattack on the largest cryptocurrency exchange left the traders worrying. Binance founder Changpeng Zhao compensated these losses from his own pocket, ensuring that users don’t get affected.
FTX, on the other hand, has a perfect track record in the market when it comes to security. They are proactive in adopting new security protocols and are among the most secure crypto exchanges out there.
Verdict: Though both exchanges are safe, Binance has been hacked once, while FTX has a clear track record so far compared to other exchanges.
FTX Vs. Binance Liquidation Mechanism
If you’ve been doing crypto margin trading for a while, you might’ve experienced a liquidation event when your position was forcefully closed. Crypto exchanges implement different liquidation mechanisms to ensure liquidity.
FTX uses a three-tiered liquidation model to reduce clawbacks. Here’s how it works:
- Positions are first closed with rate-limited liquidation orders
- A unique backstop liquidity provider program helps avoid bankruptcy of accounts
- Insurance funds help prevent customer losses
FTX states that while they aim to reduce clawbacks, they can occur. Also, the estimated liquidity price is an estimate, and the actual liquidation depends on multiple factors.
Binance uses the Mark Price mechanism to prevent unnecessary liquidations. All orders are instantly canceled on liquidation, and the traders are subject to Smart Liquidation protocols. Binance doesn’t allow full liquidation of a position, barring some instances when full liquidation is essential.
Also, keep in mind that smaller positions are generally fully liquidated. For users with larger leveraged position sizes, small percentages of their positions will be liquidated.
So Here Is The Thing
Both FTX and Binance are excellent crypto derivatives exchanges and provide a seamless trade experience to their users. However, FTX is a purely crypto derivatives platform, unlike Binance. Besides, the low trading fee, wide product offering, and stellar customer support make FTX a better choice.
Binance can be an ideal choice for you if you buy and hold Bitcoin or other assets. It’s also a good exchange if you’re looking for a crypto exchange with highest leverage exposure.
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