Choosing the best cryptocurrency exchange can be an exhausting task. This post will explain the important factors to take into account when choosing an exchange. I will also give you a review summary of the leading cryptocurrency exchanges around.
The main things to look for when choosing an exchange are: What type of exchange is this? (Broker, trading platform, etc.) Does this exchange support the coins I want to trade? Does this exchange accept users from my country? Does this exchange accept my payment method? What are the fees and buying limits for the exchange? Finally, before deciding on an exchange make sure to read several online reviews to get a feel of the exchange’s reputation. That’s how to choose an exchange in a nutshell. If you want a more detailed explanation about cryptocurrency exchanges and detailed reviews keep reading this post. Here’s what I’ll cover:
2. Exchange types It’s important to understand that not all cryptocurrency exchanges are alike. Some allow you to trade with other users, while other exchanges will only sell you Cryptocurrency directly. Some will not even give you the actual coins but will only allow you to speculate on the price. Let’s break down the different types of exchanges. Brokers Brokers are sites that simplify the buying process by allowing you to buy coins through them directly at a premium. When you buy from broker sites, the process is usually much simpler and less confusing, but it’s also more expensive. Examples of known brokers: CoinMama, Coinbase. Trading platforms Trading platforms are sites that connect buyers with sellers anonymously in an automated form. This means that you buy from people who’ve placed sell orders on the site without ever communicating with them directly. The platform usually takes a small fee for the service. Conducting transactions on trading platforms is usually the cheapest way to get bitcoins or other coins, but often it’s not very user friendly. Trading platforms have advanced options such as limit orders and stop losses that can confuse inexperienced users. Also, when you place an order, it may not be fulfilled immediately due to a lack of sellers at the price at which you want to buy. Examples of known trading platforms: Binance, Bitstamp. Some trading platforms allow you to trade CFDs (Contract for Difference). This means you’re basically betting on the price of the coin in the future instead of actually owning it. While CFDs are very appealing due to their ease of use, they don’t allow you possession of the actual coins. The process is the equivalent of betting on the fact gold will rise in price instead of actually buying gold. You won’t be able to withdraw the cryptocurrency you bought into your wallet. The only thing you’re doing is buying (or selling) a contract regarding the coin’s price in US dollars, euros, or some other form of government currency. CFDs also allow you to leverage your bets by borrowing money from them (also known as margin trading). While this can give you a great upside for successful trades, it also holds a lot of risk of losing your money very quickly. Bottom line – CFDs are very risky and are more suitable for experienced traders. Example of known CFD brokers: eToro, Plus500 P2P platforms P2P (Peer-to-Peer) platforms connect buyers and sellers directly so they can negotiate on a price. While these sites usually allow for a wider array of options (payment methods, supported countries, etc.), they also hold a large amount of risk because you’re buying from an unvetted individual. Examples of P2P platforms: LocalBitcoins, Paxful.
You now know the most important aspects to look for when choosing your crypto exchange. In the end, the main thing that matters is that the company (or seller) is reliable and that you’re happy with the price you’re paying. Sometimes it’s worth it to spend a bit more money in order to finish the process hassle-free.
Read more: https://poorh.com/crypto-exchange/