In an update earlier today, global tech conglomerate Meta shared news of its latest moves surrounding digital collectibles. From September 29th, subsidiaries Facebook and Instagram will now allow users to link their virtual wallets with their accounts and also share non-fungible tokens. Users Across 100 Countries Can Access New Meta Feature Everyone on @instagram and @facebook can now share their digital collectibles in the US, and on Instagram in the previously announced 100+ countries,” Meta announced in a tweet. https://twitter.com/MetaNewsroom/status/1575486040349245446?s=20&t=TpIDHfYcRCtVRMNrwYhWiA…
A cryptocurrency exchange is your entry into the cryptoverse. Through it, you get to conclude all the buying and selling transactions in digital currencies that you’d wish to. Their centrality to digital asset trading underscores the significance of their careful selection.
Three key questions should guide you when shopping for an exchange. First, what kinds of deals make the market offer? Second, which features make an excellent cryptocurrency exchange? And finally, which are the beginner-friendly exchanges that every novice should consider adopting?
If you’re starting your exchange hunt and relate to these questions, today is your lucky day. This article will take you through the points to consider when choosing a crypto exchange. Furthermore, it will point you towards beginner-friendly exchanges that will help ease your entry into crypto trading.
Types of Cryptocurrency Exchanges
There are many different types of exchanges. These include;
Trading Platforms Exchanges
Trading exchanges are the most common type of exchange. These are platforms that connect buyers and sellers for transactions. They charge fees for facilitating this interaction.
Centralized exchanges (CEX)
Centralized exchanges employ a third party to guarantee trust for transactions taking place on them. Since they’re custodial, they fully control all the trades. Another key feature is that they emphasize compliance with KYC and AML requirements. Also, Every user adheres to the exchange’s procedures and mechanisms in executing trades. Besides crypto-to-crypto exchanges, they undertake fiat-to-crypto transactions or vice versa. Binance and Coinbase are examples of prominent centralized exchanges.
Decentralized Exchanges (DEX)
Unlike CEXs, a DEX dispenses off with the use of intermediaries. In their place, they use smart contracts to conclude exchanges. As they are non-custodial, they afford their users’ total control of their funds.
Moreover, their permissionless nature discards conformity to strict KYC and AML regulations. Again unlike CEXs, they predominantly offer crypto to crypto trades. Among the popular DEXs are Uniswap, SushiSwap, and dYdX.
Direct Trading Exchanges
These exchanges are founded on a direct P2P model and facilitate crypto exchanges between individuals from different countries. The platforms don’t fix market prices. Instead, each trader sets their exchange rate.
Atomic Swap Exchanges
Atomic swap exchanges, aka atomic cross-chain trading exchanges, are smart contract based platforms enabling traders to undertake different cryptos’ atomic swaps. Like DEXs, they exclude intermediaries from trades.
These are crypto exchanges where brokers set prices. They operate similar to foreign exchange dealers.
Factors To Consider When Picking A Crypto Exchange
As indicated in the opening, the first step towards a fulfilling crypto trading adventure is selecting a suitable exchange. Today any crypto trader has a wide selection of trading platforms to choose from. All of these have their strengths and flaws. Accordingly, their suitability varies with the individual. Getting the best out of exchanges calls for care in their selection. As you embark on the process, here are some key questions to guide you along.
What’s the Exchange’s Reputation?
The exchange’s character ought to be a key factor to consider when selecting an exchange. To determine the exchange’s reputation, look at reviews from the users and reputable industry sites.
What Security Guarantees Does the Exchange Offer?
Security ranks high on every crypto trader’s wish list. You want assurances that you’ll trade safely on the platform. The rising cases of crypto theft and fraud have heightened this need.
To bolster their security, exchanges have adopted upgraded security features. For example, they employ cold storages, 2FA, end to end encryption, and email verification, among others.
All customers desire fair treatment. Professional customer support makes you feel valued. It is responsive, knowledgeable, and empathetic. Such customer support assures you of timely and amicable resolution of any issues you may have. The exchange you choose should guarantee you top-notch customer service.
Does it Geo-Restrict Services?
Some exchanges have geo-restricted access to functions and services. As a crypto trader, it is essential to establish if the exchange you’re drawn to offers full access to services and products within your locale.
Is the Platform Legit?
The cryptocurrency space is still in its infancy. Despite growing acceptance, many countries still hold restrictive views about them. Consequently, many crypto exchanges and trading functions lack legitimacy in many jurisdictions.
It’s essential to ascertain an exchange’s legal standing in your country before signing up. This way, you’ll avoid running afoul of the law.
How open is the exchange? Who’re its owners? What’s its location? What’s the team’s makeup? A transparent exchange inspires confidence that they are authentic. Additionally, they publish their cold storage addresses and the means of checking their reserves.
The platform’s liquidity is another critical consideration you should make. Exchanges vary in their liquidity levels. Higher liquidity implies confidence in the platform. Besides, it streamlines cryptocurrency exchanges.
Additionally, it’s crucial to establish whether the exchange offers “locked-in” pricing. This feature guarantees you the price at the time of your transaction regardless of the settlement time. Understand that liquidity can vary depending on trading pairs. While it may be high for BTC/EUR, it could go below for BTC/GBP.
Traders should look at how the transaction costs compare across exchanges. Usually, these are less than 1% of the transacted value. Again, they could decrease with increased trading volumes.
You should also check the withdrawal fees. On this score, some exchanges are dear. Furthermore, it’s vital to ascertain a platform’s deposit fees. Though debit and credit cards offer convenient means of purchasing cryptos, they charge up to 5% of the transactions or higher.
Before settling on an exchange, interrogate the user’s experiences. How satisfied would you be if you chose one platform over another?
Look at such aspects as the levels of anonymity they’d guarantee you. Ask yourself how easy it is for you to navigate the interface. Is it available on multiple devices? Additionally, check for user feedback on the platform, particularly their pros and cons.
10 Dependable and Beginner-friendly Crypto Exchanges at Your Disposal
By now, you must have a good grasp of what a crypto exchange is. You’re well versed in what to look for in one too. Let’s now shift our focus to some of the dependable and beginner-friendly platforms available. Shall we?
Binance boasts of being the largest crypto exchange by volume.
Impressive ICO Listings
Its popularity stems from its impressive ICO listings. Also, it has an amiable CEO and levies low trading fees.
Binance’s strength is in its comprehensive crypto offering. Moreover, it has an intuitive user interface that allows for easy switching between advanced and basic views.
Users needn’t verify their accounts before starting cryptocurrency exchange. However, the platform caps withdrawals at 2 BTC daily. To qualify for higher amounts, you’ll have to pass their KYC test. The test requires you to send them a picture of your ID and selfie.
OKEx is a multi-crypto exchange designed for professional traders. It’s one of the largest and most trusted exchanges available.
Apart from crypto-to-crypto trading, the platform supports fiat trading. It also hosts digital asset-based futures with diverse leverage choices. Users enjoy a wide variety of trading pairs. They can trade directly between crypto and fiat currency. OKEx is also developing a crypto-derivatives market by offering futures.
The OKEx platform offers different verification levels. Each has its set of requirements and benefits.
Level One Verification: At this level, the user can access most parts of the OKEx site. It comes with a transaction limit of $2,000. All you need is a username, an ID, and a confirmation of their nationality.
Level Two Verification: Level two verification grants you access to all trading functions. Furthermore, you have a limit of $200,000. You’ll have to identify yourself and provide your photograph.
Level Three Verification: Your transaction limit grows to $500,000. Additionally, you require video verification of your identity. Check out our full review here.
The largest digital asset platform globally, it serves more than 4 million active users. It’s present in over 33 countries. These figures explain why it’s one of the most trusted exchange platforms.
Hustle free Transactions
Traders can use multiple means to trade their BTC. Among other payment methods, they may use their bank accounts, credit cards, and PayPal.
Traders will find Coinbase to be a beginner-friendly platform. On set up, the only other requirement is linking an existing bank account. After that, you’re good to go.
Coinbase supports many cryptos, including BTC, BCH, ETH, LTC, ETC, ZRX, and USDC. Unfortunately, it doesn’t support all the countries. As such, you’ll need to check your country’s eligibility before signing up with them. Check out our full review here.
KuCoin is a Singapore based multi-cryptocurrency exchange platform. Theirs is a crypto-to-crypto service dealing with a wide selection of cryptocurrencies.
The platform is feature-rich. It prides itself in offering its customers a safe and straightforward user interface. One can access it via desktop or mobile through the KuCoin App that supports both android and ios. Further, it charges lower fees.
The platform incentivizes holders of its native currency KuCoin Shares (KCS) through discounting their trading fees. Additionally, the exchange adopts a profit-sharing mechanism. It distributes 50% of the daily trading fees to KCS holders.
Headquartered in Seattle, Bittrex is an established and highly regarded crypto trading platform. Prominent in its features is its robust security and reliability. Moreover, it has a comprehensive coin offering; it holds about 300 cryptos and counting.
Bittrex fashions itself as the next-gen crypto trading platform. Its other salient features include fast deposits and withdrawals, reliable customer support, and fiat trading. That said, its user interface isn’t beginner-friendly.
CoinMama is a brokerage exchange that allows you to acquire cryptos using your debit or credit cards.
Faster Crypto Acquisition
One of CoinMama’s selling points is its beginner-friendly setup. It prides itself in being one of the fastest and easiest ways to buy Bitcoin or Ethereum, Litecoin, Cardano, QTUM, Ethereum Classic, Bitcoin Cash Ripple XRP directly from your credit card.
Coin mama charges low transaction fees. As compensation for this, it nevertheless places daily caps higher than Coinbase. The daily cap is up to $5,000 of coins, while the monthly figure is $20,000. Account set up requires you to provide personal information.
LocalBitcoins is a P2P crypto exchange popular in most major cities around the world. Its underlying thinking is that people can find others in their locality for in-person exchanges.
Multiple Payments Avenues
Users can purchase cryptos through PayPal, Square, direct-to-bank transfers, besides other payment-processing methods. Sellers applying their exchange rates incur a 1% fee per transaction.
Privacy Focussed Platform
The platform targets the privacy-conscious trader. You can purchase BTC in person without linking your ID to the exchange. To mitigate scams, all transactions have to go through an escrow process. After verification, the exchange concludes with them.
Launched in 2013, CEX.io is one of the oldest and popular cryptocurrency exchanges still in operation. Earlier, it served as a BTC exchange and cloud mining service. It, however, shut its mining services in 2015 to concentrate on the cryptocurrency exchange.
A Beginner-Friendly Platform
CEX.io’s easy to use interface makes it a popular choice for beginners. It operates a customizable multi-level account system that is every institutional trader’s favorite.
Multi Payments Support
Due to its affiliation with the FINCEN, it carries out KYC and AML checks. It supports credit card purchases and wire transfers. European residents can use SEPA transfers.
Founded in 2011, Kraken has built a reputation for secure cryptocurrency trading. It finds favor in both individual traders and institutions. Again, it has international appeal and is the current leader in BTC-Euro trading volumes.
Support for Major Fiat Currencies
Kraken allows deposits and withdrawals in CAD, EUR, JPY, and USD. Again, it employs Bank Transfers to conduct fiat currency payments. For users resident within the EU, they can use the SEPA payment system.
Bitpanda is one of Europe’s popular exchanges. It specializes in crypto-fiat transactions. The exchange facilitates exchanges in Bitcoin, BCash, Dash, Ethereum, Litecoin, IOTA, Komodo, Ripple Ethereum Classic to US Dollars, Euros, British Pounds, and Swiss Francs.
Diverse Payment Methods
The exchange accepts many payment methods: bank transfers, credit cards, debit cards, Skrill, and Neteller. It levies a 3.98% fee on credit and debit card trades. Its simple user interface eases trading for beginners.
No Fees for Account to Account Transactions
Bitpanda has waived the transaction fees for sending crypto between accounts on the exchange. This move makes transferring low amounts of crypto convenient.
The journey to a fulfilling crypto trading experience begins with your selection of a cryptocurrency exchange. To the novice, this could be daunting. However, it needn’t be so if one knows what to look for in the trading platforms. This article has highlighted some of the critical factors to consider when exchange hunting. It has gone on to identify some handy crypto trading platforms for the newbie. It is an invaluable resource for any person starting in their trading journey.