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The BTC withdrawal fee in Binance (and pretty much every other exchange) is 0.0005 BTC - very high. However, if you do the withdrawal over their Binance network then the fee is only 0.0000014 BTC (a mere fraction!). Question is, can that network be used to withdraw "pure" BTC? How? The address I have on my (Trezor) cold wallet is a SegWit address which apparently doesn't fit the criteria.

Also, if it's stored in a separate network, does that mean that I'll only be able to sell my BTC via Binance?

Many thanks.

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However, if you do the withdrawal over their Binance network then the fee is only 0.0000014 BTC (a mere fraction!)

This transaction will involve withdrawal of a token on other chain. This token is not same as BTC. I have explained few things in this answer: https://bitcoin.stackexchange.com/a/100838/

Those options available for BTC withdrawal are misleading but there is nothing much we can do about it. I tried my best by creating a question on Stackexchange, sharing on Reddit and ask few people to tweet about it. Not sure what else can be done for the misinformation, marketing, misleading things etc. by altcoiners in this ecosystem.

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  • How do you empirically know that misinformation and misleading things are being spread specifically by altcoiners? – Hamish Gibson Feb 4 at 13:44
  • Because I am not a newbie. Involved in Bitcoin since 2015, was founder of flybit in 2017 and active on Stackexchange since last year. It's not difficult to understand how marketing works. In this case everyone knows background of CZ, involvement of Binance in different things and other misinformation being shared regularly by people involved in altcoins. – Prayank Feb 4 at 14:02
  • I think your comments are quite broad and may be slightly unfounded without empirical evidence, it's anecdotal. I personally don't know about the background of CZ nor what this has to do with altcoins either. – Hamish Gibson Feb 4 at 16:56
  • Ignore the things that you don't understand or not agree with. Your question is answered : those tokens are on different chain and not same as BTC. – Prayank Feb 4 at 17:10
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    @Prayank I appreciate your answer a lot, it's on point and it explicitly states you're given another token rather than a BTC as I asked. While your second part of the comment might be an opinion that doesn't apply to all altcoins it is definitely valid. Binance's website is empirical. Saying you can withdraw BTC over a network other than BTC's is misinformation. And this misinformation is provided by Binance in regards to their altcoin. So yeah that's pretty much empirical proof of your statement. – seneca Feb 4 at 23:24
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It sounds to me that the differing fees stem from a qualitative difference in what you are being offered. The "withdrawal over the Binance network" provides you an IOU for Bitcoin. If you want to take possession of the actual bitcoins on your Trezor, you will need to chose the Bitcoin withdrawal method. This is more expensive, because it requires an on-chain transaction to be committed to the Bitcoin blockchain.

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