What is crypto dust and how do you convert it?

Crypto dust is a tiny leftover balance of a coin that is worth less than the cost of sending or trading it. It usually builds up from rounding after trades, partial withdrawals or old rewards. On an exchange it clutters your portfolio. In a self-custody bitcoin wallet it can sit as small outputs you may never be able to spend profitably.

What is bitcoin dust?

Bitcoin balances are made of separate pieces called outputs, explained in what is a UTXO. An output becomes dust when spending it would cost more in fees than the output holds. The Bitcoin Wiki points out that people also use the word loosely for any very small output.

Not all dust arrives by accident. Someone can deliberately send tiny amounts to many addresses to trace them, which is covered in what is a dusting attack. This guide is about the ordinary leftovers most holders end up with.

What is the dust limit in Bitcoin?

Bitcoin Core, the most widely run node software, calculates a dust threshold for each output. It adds the size of the output to the size of a typical input needed to spend it, then multiplies by a default dust relay fee of 3,000 satoshis per thousand virtual bytes. The source code comments give 546 satoshis for an older-style output and 294 satoshis for a native SegWit output. The Bitcoin Wiki lists 330 satoshis for Taproot outputs.

Nodes running default settings will not pass along a transaction that creates an output below the limit. The Bitcoin Wiki stresses that this is relay policy, not a consensus rule, so a miner can still include a dust output in a block.

How do you convert crypto dust on an exchange?

Several exchanges sweep small balances into one asset in a single step. As of October 2026:

• Binance treats balances under 20 USDT as small, lets you convert them to BNB, BTC, ETH, USDT or USDC once an hour, and charges a flat 2% fee (10% for Alpha tokens). Delisted tokens cannot be converted.
• Binance.US covers balances under $20 and over $0.01, converts to BNB, BTC, ETH or USDT, and requires 6 hours between conversions. The fee is shown before you confirm.
• Kraken defines small balances as anything below its minimum instant order, about $1, allows one conversion every 24 hours, and charges 3%.

In a self-custody wallet there is no sweep button. Bitcoin dust can be combined with larger outputs when fees are low, but that publicly links the outputs together. Some wallets let you mark coins as do not spend instead.

Is dust conversion a taxable event?

In the US, generally yes. The IRS FAQ says exchanging one digital asset for another can produce a capital gain or loss, and a dust sweep swaps several small holdings for a new coin. The amounts are usually tiny, but each conversion is still a disposal. See crypto tax forms for how disposals are reported.

Rules differ by country and change often. Check the tax authority or a qualified professional for your own situation.