Tagomi Charges 0.1% on 1M Trades as Fee War Comes to Crypto

Cryptocurrency exchanges are taking notice of the trading-fee war. Tagomi, which operates as a Prime Broker Prime Broker Prime brokers are the designation given to individuals handling a package of services offered by investment banks, wealth management firms, and securities dealers to hedge funds which need the ability to borrow securities and cash in order to be able to invest on a netted basis and achieve an absolute return.There are two types of prime brokers - bank and non-bank corporations. Traditionally major global investment banks have been the predominant players in the space, however recent years have p Prime brokers are the designation given to individuals handling a package of services offered by investment banks, wealth management firms, and securities dealers to hedge funds which need the ability to borrow securities and cash in order to be able to invest on a netted basis and achieve an absolute return.There are two types of prime brokers - bank and non-bank corporations. Traditionally major global investment banks have been the predominant players in the space, however recent years have p Read this Term in the crypto space, has cut its fees by more than 50 percent to gain market share as competition piles into the crypto trading space.

The startup, however, keeps its multi-tiered fee structure, where traders get a lower rate if their transactions reach a certain volume.

Fees for crypto traders are down to 0.1% or less per trade, which Tagomi claims it saves them $25 when they buy $10,000 worth of bitcoin through its platform. According to its updated fee schedule, the startup charges a flat fee of 10 basis points for trades smaller than $1 million, down to 0.08% for volumes ranging from 1 to 10 million.

Tagomi says the aggressive cuts offer some of the lowest levels in the industry, making other crypto exchanges to have room to cut. More specifically, the new rates are nearly 70 percent lower when compared to what traders pay to the likes of Coinbase and Gemini.

Tagomi, which launched its electronic-trading service for crypto last year, is aggregating Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term across multiple exchanges and executing trades based on a single unified order book. The broker also provides its partners with straight-through process and workflow when managing crypto portfolios and trading across many exchanges and other destinations.

Tagomi is trying to attract bigger volumes and increase liquidity on its platform as fee compression hits all crypto exchanges. According to its latest metrics, the New Jersey-based crypto prime broker handles less than $20 million in weekly crypto volumes or about $1 billion per year.

Tagomi came on board for the institutions

While it appears to be nearing the finish line in the traditional trading industry, race-to-zero price competition is likely to happen in the cryptocurrency sphere.

Tagomi was co-founded by former HFT technologists, including Greg Tusar, global head of electronic trading at Goldman Sachs, and Jennifer Campbell from Union Square Ventures. It recently raised $28 million from Peter Thiel’s Founder Fund and Paradigm as well as others.

In an interview, Tagomi co-founder Marc Bhargava told Finance Magnates that while more retail-type exchanges are emerging, companies like Tagomi came on board for the institutions.

“But someone looking to do larger trades and wanting to do them electronically rather than calling an OTC, wanting to use more advanced algo types, wanting to do things like lending and shorting–and most importantly, wanting it done on an agency basis (meaning wanting someone to execute these trades and then post trade reports and show them how they did it in the best possible way for them–none of [those features] really existed, because it was a really nascent market,” he said.