There are hundreds of cryptocurrency exchanges available across the world. While some have been around longer than others, it does not mean that the more recent one is not reliable. Cryptocurrency exchanges vary according to the type of cryptocurrencies they have available for exchanges; type of exchanges they carry out as well as transaction fee rates.
Factors to consider when selecting a cryptocurrency exchange
When determining which cryptocurrency exchange is reliable, traders should consider the following factors.
- Exchange limits. Exchanges usually stipulate their maximum and minimum limits that they allow for trading. Traders seeking to join a specific exchange should look for one that fits their investment budget. If one is trying out cryptocurrency trading and they have a small budget, they should go for those with lower minimum limits and vice versa.
- Transaction fees. Fee rates for transactions vary from country to country, type of payment method, type of currency being traded as well as the amount being traded.
- Speed. How long will the transaction take? Time taken for a trade is crucial because the trading rate for digital currency may change hourly or more frequently. The speed of transaction may also be determined by payment method and availability of traders to match one’s order.
- Reputation. Traders should do due diligence to find out how long the exchange has been around, whether it has had a scam previously and if it is licensed. Other traders’ review of a particular exchange can serve as a guide to its reputation.
- Verification requirement. Although exchanges offer anonymity among account owners, each exchange must carry out a thorough verification process for each person joining the platform to confirm their credibility. Although the process may take long, it helps protect the exchange and its traders against scams and illegal practices such as money laundering.
- Geographical restrictions. Some exchanges offer their services to specific countries while restricting others. A trader should register in exchanges that avail trading services in their region.
Best cryptocurrency exchanges
This section of the article will give a brief review of some of the best exchanges.
Coinbase is one of the most popular exchanges used by traders across the globe. The platform allows traders to buy, store, use and trade their digital currency. With millions of users globally, it is reputed for security, fair transaction fees ease of use and accepting a wide range of currencies. Coinbase mainly allows trading in Bitcoins, Litecoins, and Ether. It also provides a bitcoin wallet that is compatible with both android and apple devices. It is an ideal choice for beginner traders.
Kraken has been offering cryptocurrency exchange services since 2011. It is credited with having the highest volume of bitcoin exchange against the euro. Kraken allows traders to sell and buy a wide range of cryptocurrencies including bitcoins, Ethereum, Augur REP tokens, Zcash, Litecoin, Monero, and Dogecoin. It is suitable for advanced traders as it offers them advanced trading features such as margin trading. It is praised for low transaction fees, fair exchange rates, security, global accessibility and an excellent customer support.
Shapeshift is preferred for instant trading. It only supports buying and selling of digital currency but does not offer a store feature. Cryptocurrencies traded via Shapeshift include Bitcoin, Ethereum, Monero, Dogecoin, Dash, and Zcash. The platform has a strict fiat policy and does not allow other payment systems including credit and debit cards. It only accepts trading of bitcoins against other accepted digital currencies.
Bitstamp was founded in 2011 with the aim to serve the European Union in cryptocurrency exchange. It has since built a loyal customer base for its sophisticated security features, quality customer support, and a multilingual user interface. Users undertake a two-step verification process. It is considered a high-end exchange platform due to its high deposit fees. Therefore, it is suitable for traders transacting large amounts.
Gemini is licensed as a bitcoin and ether exchange platform. It has a user-friendly interface making it ideal for beginner traders. Customer deposits are insured and held in cold storage. It only accepts US dollar payment currency as well as ether and bitcoins. Trading operates by maker-taker schedules. It is geographically restricted to US, Canada, Hong Kong, South Korea, UK, Singapore, and Japan.
CoinMama has been in operation since 2013 and served as a broker type of exchange. It supports trading in bitcoins and ether. Traders can use wire transfers and bank transfers to transact. The website is multilingual to serve customers who speak in either English, Russian, German, French or Italian. It is ideal for beginner traders and traders seeking to make instant exchanges.
Cex.io allows traders to trade cryptocurrencies against fiat currency and vice versa. It offers advanced traders an option for margin trading. Cryptocurrencies are held in secure cold storage. It is ideal for both novice and beginner traders.
This is a peer to peer bitcoin exchange that connects thousands of traders across the globe. Traders can trade across that platform or meet each other face to face to transact. The platform accepts a wide range of payment methods such as PayPal, Skrill, Cash, and bank transfers. Peer to peer transactions is charged a 1% commission. A security system has been put in place to protect traders from being scammed. Upon requesting to buy, a buyer is required to deposit the amount of money they intend to trade in in the exchange’s escrow service, one the seller confirms the trade, the money is released to their account.
The platform was founded in 2014 and has grown to become one of the most popular exchanges. It allows for over 100 cryptocurrency pairings with advanced trading tools to cater to the novice trader. It is famous as a high-end trading platform for high volume transactions. It employed maker-taker schedule with traders either charged a maker fee or taker fee.
Customer reviews on the various exchanges is one of the surest ways to determine the credibility of the exchange. Before registering on one, traders should do a thorough research of the transactions to determine if they are credible and to find one that suits their needs.