Understanding Excess Fee Adjustment

If you see “Excess Fee Adjustment” as a transaction line item in your Activity History, it indicates that Coinbase overestimated the gas fee that Coinbase provided to you for a particular BTC withdrawal and this line item represents the unspent gas amount returned back to Coinbase. You will only see it when you perform a full withdrawal out of a BTC Prime Vault wallet.

Here is how it works:


Step 1: Initiate a full withdrawal

When you decide to withdraw all of your BTC holdings and initiate a full withdrawal (i.e. all of your BTC balance). For example, if your starting BTC balance is 100 BTC, and you have initiated a withdrawal request for 100 BTC.


Step 2: Gassing fee deposit

Before processing your withdrawal request, Coinbase sends a gassing fee deposit to your account. This deposit is higher than usual to ensure a successful withdrawal. For instance, if you receive a gas deposit of 1 BTC from Coinbase, now your BTC balance will be 101 BTC.


Step 3a: Processing the withdrawal

Now your withdrawal request can be processed, and the appropriate gas fee will be deducted. For example, the actual gas fee is 0.4 BTC, 100 BTC will be transferred, leaving 0.6 BTC unused gas. At this point, you will see the withdrawal transaction is marked as complete.


Step 3b: Return of unused gas fee

Simultaneously with Step 3a, the 0.6 BTC of unused gas fee (i.e. Excess Fee Adjustment) will be sent back to Coinbase automatically. As part of this process, you will now see a new transaction item labeled “Excess Fee Adjustment” in your Activity History. Below is an example of how it looks like:

Rest assured, there is NO financial impact in your wallet when you see this transaction line item in your Activity History.