Many cryptocurrency exchanges that are accessible online today are scams. Countless people have lost a significant amount of money and time by choosing inept and faulty exchanges without proper research and knowledge.
How to Choose a Cryptocurrency Exchange
Learning to separate the wheat from chaff takes time, but you have come to the right place. This article will explain the important aspects to keep in mind while choosing a proper exchange according to your convenience.
It is essential for you to consider factors such as fees, security, transparency, user experience, and market value before considering a random cryptocurrency exchange to buy dogecoin, bitcoin, ethereum, or any other cryptocurrency. It can be a hectic job for you to do, but it’s all worth it.
Safety and Security:
When choosing a crypto exchange to trade bitcoin, ethereum, or you want to buy dogecoin or any other cryptocurrency, the exchange’s security should be the first thing you need to take into account.
If the cryptocurrency exchange is insecure, you will not only lose your money, but you will be at the risk of identity theft, hacking and sensitive data loss. Consider the following to check the security of the platform:
- Login safety
- Two-factor authentication
- Cold storage deposits
- SMS and Email alerts
- Web addresses starting with ‘HTTPS.’
- Legal features of the platform
Transparency:
It is crucial for you to know the company’s headquarter address, the information of its team members, and its owners. Transparent cryptocurrency exchanges often broadcast their cold storage address in order to provide a better experience.
Some exchanges help use other methods, such as audit information so that users can check their reserves.
Liquidity:
Its trading volume determines the liquidity of an exchange. The more liquid a certain exchange is, the larger the trade volume is. It is easier to make fast and secure transactions without the risk of cryptocurrency price volatility.
It is always worth noting if the exchange provides “locked-in” pricing, which guarantees you the price while making a transaction.
Be alert that liquidity for various trading pairs may vary. For example, it might be high for BTC/EUR but low for BTC/GBP.
Transaction Fee:
Before choosing the exchange, compare every kind of fee, the specific exchange charges. Most exchanges charge 1% per transaction, but the fee might decrease further if your trading volume is high.
However, some exchanges charge high withdrawal fees, so you need to keep a check on the withdrawal fee for specific altcoins.
Usability and Interface:
If your privacy is important to you, you would not want to participate in an exchange that asks you to give too much information about yourself. You must see if the user interfaces on both a desktop and a mobile device are straightforward and easy to use.
What do other users have to say about the advantages and disadvantages of a certain exchange and the assistance it provides? All these aspects make an exchange a good one.
Some Recommended Popular and Safe Exchanges:
Cryptocurrency exchanges differ from each other in respect to the factors mentioned above. It is your own duty to choose the exchange that suits you well. Following are some of the most popular and secure cryptocurrency exchanges.
Some exchanges are better for beginners, and some may be better for advanced traders working on a larger trading scale.
Binance:
Binance is the world’s largest cryptocurrency exchange. It is a stress-free way to exchange commonly traded cryptocurrencies. It deals with the trading of more than 500 cryptocurrencies such as Bitcoin, Ethereum, Dogecoin, and many more.
Binance Exchange holds its own cryptocurrency called ‘Binance Coin (BNB).’ Binance Exchange has developed several supporting programs for its users to assist and make trading decisions clearly and effortlessly.
Coinbase:
Coinbase is the most widely used crypto exchange in the United States. It was founded in 2012; it offers a very user-friendly system, high financial resources, and various altcoin choices. It is a legitimate exchange and broker.
Coinbase has never experienced any hack despite having lots of clients. Coinbase offers very high limits and liquidity.
Coinbase has a solid number of cryptocurrencies to trade and invest with, some of which are Dogecoin, Bitcoin (BTS), Litecoin (LTS), and Tezos (XTZ), etc. Trading on Coinbase is a very convenient and secure process. Coinbase also offers wallets for its users to store and collect investments.
Kraken:
Kraken is the first cryptocurrency bank, and it is the largest exchange in euro liquidity and volume. Kraken deals with US Dollars, Canadian Dollars, Euros, as well as digital currencies like Bitcoins, Ethereum, Litecoin, Dogecoin, etc.
Users find Kraken as a great choice for buying, selling, and trading.
As one of the largest crypto exchange platforms, Kraken is sufficient for beginners and newcomers. It offers an easy-to-use interface and two-factor authentication for proper security measures.
Conclusion:
While a cryptocurrency exchange, you need to do your own research to avoid fake and fraudulent exchanges.
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