What is a cryptocurrency exchange?
A cryptocurrency exchange is a platform for investors to trade cryptocurrencies with each other and another cryptocurrency or fiat currency. It is a place for the circulation and price discovery of crypto assets and acts as a middleman between buyers and sellers, earning profits mainly by charging commissions or transaction fees for transactions and also providing a range of value-added services.
There are three types of cryptocurrency exchanges, namely centralized exchanges, decentralized exchanges, and derivatives exchanges.
(1) CEX (Centralized Exchange) is a platform that combines the functions of traditional exchanges, brokerages and investment banks, gathering a huge volume of users and transactions, and also bringing enough trading depth to provide sufficient asset liquidity. The representative exchanges are Binance (Coinan), OKEx, Huobi (Firecoin), CoinBase four major exchanges
(2) DEX (Decentralized Exchange) is a blockchain-based exchange that does not store users' funds and personal data on its servers, but only uses it as an infrastructure to match buyers and sellers who want to buy and sell digital assets. With the help of a matching engine, such transactions happen directly between participants (peer-to-peer).
(3) Derivatives exchanges are one of the fastest growing cryptocurrency markets, with the best balances in the exchanges offering highly leveraged products and ensuring traders understand the basic workings of the market and the risks involved. The dominant derivatives in the cryptocurrency market are: leveraged trades, futures contracts, options contracts and leveraged tokens. Of the four major exchanges, Coinan, Firecoin, and OKEx all have derivatives exchanges.
Please note that there is a huge risk in using decentralized platforms, as technical failures in exchange operations can result in the loss of your assets. Centralized platforms are better protected in this regard.
How to choose the right cryptocurrency exchange?
The country you live in. Almost all exchanges have a list of supported countries. Residents outside of these jurisdictions should not use these exchanges.
You should also check if the exchange supports your home country's legal tender. If it does not, then you need to find a way to transfer your funds to this exchange.
Security of funds. Security is a key factor in maintaining the entire crypto market. Before choosing an exchange for yourself, you should answer the following questions.
1. who keeps my funds?
2. Has the exchange conducted a security audit? What is the conclusion?
3. Where are the funds stored on the exchange? Is this place secure enough?
4. Does the exchange have any insurance if funds are lost due to a security breach?
Once you have answered the above questions, you will be able to judge the security of the platform.
Convenient user interface. Some exchanges have a very good product offering, but a very complex user interface. This can lead to confusion in understanding the products or trading methods. Therefore, you should choose an exchange that has an interactive web application and is compatible with mobile applications.
Liquidity and trading volume. If you want to buy tokens, you need to make sure that people are interested in selling the tokens on the exchange. Therefore, liquidity means the availability and size of the cryptocurrency on a particular exchange. The higher the trading volume on an exchange, the greater the prospects of profitability you will get. An exchange with a daily trading volume of $50 is unlikely to offer you high returns. The high daily volume of an exchange is an indication of its success, popularity and influence in the overall cryptocurrency market. For this reason, you should check the number of trading pairs supported by the platform and the 24-hour trading volume of the platform.
Transaction processing time. You need to be aware of the total time it takes for a trade to be completed on the platform and the account withdrawal processing time. It can be a very frustrating experience to be forced to miss trading opportunities due to the length of time it takes for trading funds to enter your trading account. Waiting day after day for withdrawals to arrive in your bank account or crypto wallet can also be extremely stressful, so please check the average processing time before signing up.
KYC Rules.KYC representatives know your customers. Almost all centralized exchanges have a KYC policy base that collects information from users and enables them to use the platform. What you need to check is the type of information collected and the time it takes for the exchange to perform the verification.
Transaction fees.In every transaction, the exchange charges a transaction fee. This transaction fee is a cost to you, so you should try to choose the exchange with the lowest transaction fee.
The reputation of the exchange in the market.Cryptocurrency exchanges act as intermediaries between buyers and sellers. Therefore, you need to make sure that the exchange is legitimate and does not have a bad reputation in the market. To do this, you should search for any possible scams that the exchange may be involved in. We recommend that you listen to the advice and experiences of other users and choose a verified website.
The exchange's relationship with state authorities.Finally, you should check if the cryptocurrency exchange complies with the regulations of your country. If the exchange is banned by the authorities, you should not use it under any circumstances.
Which are the best cryptocurrency exchanges?
We conducted an extensive review of the available cryptocurrency trading platforms. To come up with these choices, our comprehensive list of the best cryptocurrency exchanges is compared in terms of user experience, fees, payment methods, coin selection and more.
Binance - Best for pledging rewards,the world's largest exchange
Huobi - Best for security
FTX - Best for advanced traders
Kraken - best cryptocurrency exchange (overall), best value exchange, best for beginners
Crypto - Best for cryptocurrency trading, Best for NFT
Gemini - Best for coverage; supports all 50 states
Coinbase - Best Learning Rewards Program
KuCoin - Best for emerging cottage coins
1. Binance
Official website: https://www.binance.com
Binance is the world's leading cryptocurrency exchange, completing its ICO on July 21, 2017, and raising $15 million. In addition to being an ultra-fast trading platform, the platform is designed for all levels of traders, i.e. from beginner traders to advanced traders. The platform offers a built-in wallet that is perfect for storing bitcoins in a short amount of time. In addition, Binance has an earning feature that allows you to deposit your crypto assets, such as Bitcoin or USDT, and earn interest from your holdings.
It has grown tremendously since the ICO so far. It has become the world's leading cryptocurrency exchange in terms of trading volume and token pair availability. It now lists over 370+ cryptocurrencies, in addition to token listings that are increasing every month.
Advantages of the Binance Exchange.
1. the number one exchange in the world in terms of the trading volume.
2. founded in 2017, has surpassed the world's leading exchanges in terms of the average daily trading volume.
3. the fastest growing exchange in China with its own BNB cryptocurrency, designed to attract seed funding through ICOs.
4. traders are attracted by low commissions - 0.1%.
5. it is important to note the high performance: the exchange processes up to 1.4 million orders per second
6. the site supports the most popular cryptocurrencies and the possibility of creating a wallet for each of them
7. it offers a wide range of professional tools for trading and analysis
8. a commission of only 0.1% per transaction; no commission is charged for depositing any cryptocurrency
9. no verification is required.
10. availability of applications for trading on mobile devices.
11. easy and fast interface
2、Huobi
Official website: https://huobi.com/
Founded in 2013, Firecoin is a cryptocurrency exchange that has now become a professional trading platform for professional traders. Initially, Firecoin operated only in China, but in 2017-2018, the site rapidly expanded to other parts of the world. According to CoinMarketCap resources, the trading volume ranks among the TOP-10 exchanges. Daily trading volume exceeds $1 million. The most popular token is NT, issued by the exchange itself to fund its activities. Cryptocurrency exchanges are known for their high data security, so special attention should be paid to registration and account verification.
Advantages of the Huobi exchange.
1. 3rd highest total trading volume of cryptocurrency exchanges worldwide, with over $518 billion in 24 hours (according to CoinMarketCap data).
2. Reliability: 5 years of experience in financial services for digital assets.
3. demand: total platform user assets of over $10 billion.
4. Improved security: the platform uses a dedicated distributed system to defend against hackers, and 98% of user funds are stored offline in a "cold" multi-signature wallet.
5. User-centric: priority compensation system and investor protection fund.
6. Expanding global blockchain ecosystem: service centers around the world.
7. Multi-language: interface supports 13 languages.
8. Firecoin cashback privileges: 30% commission for inviting friends.
9. Multi-platform access: mobile apps for all platforms (iOS, Android, Windows and Mac).
3、Kraken
Official website: https://www.kraken.com/
Kraken is one of the oldest cryptocurrency exchanges that has been around for over a decade. The exchange was founded in 2011 and offers Bitcoin as well as many known cryptocurrencies. It offers a total of 346 pairs of crypto tokens.
Kraken also offers derivatives with margins of up to 50x. In addition, it has the option to earn passive income, such as pledging. You can use Kraken to deposit and withdraw funds to any bank account worldwide. In my experience with Kraken, bank transfers are fast and the support is excellent.
Advantages of Siren Exchange.
1. offers a variety of educational resources for beginners.
2. deposit and withdraw funds to any bank account worldwide.
3. offering a flat rate for cryptocurrency purchases, which is beneficial for those who do not trade often
4. a simple user interface.
5. stop-limit orders and other features
6. Multi-platform access: mobile apps for all platforms (iOS, Android, Windows and Mac).
4、Crypto
Official website: https://crypto.com/
Crypto.com was launched in 2016 and has become one of the leading cryptocurrency exchanges in the world. It is now available in 90 countries worldwide and supports more than 250 cryptocurrencies.
Crypto.com's website provides the latest digital asset price information from CoinMarketCap, a market data site that reports price data for over 20,000 crypto assets. Using this information, you can set up price alerts to help you time your trades and take advantage of market changes as they occur.
Advantages of crypto exchange.
1. wide selection of coins and tokens.
2. support for over 250 cryptocurrencies.
3. the more transactions, the lower the transaction fees.
4. the website provides excellent insight into market data
5. earning on a range of cottage coins.
6. can be easily accessed through a mobile crypto exchange application.
5、FTX
Official website: https://ftx.com/
FTX is a relatively new exchange, established in May 2019 by FTX Trading Ltd. The exchange is growing rapidly due to its very interactive user interface and many unique offerings in the derivatives market.
The exchange has almost all the services offered by other leading exchanges such as spot trading, futures trading, ETF trading, margin trading and Staking. However, it also has some unique offerings such as Leveraged Tokens, Tokenized Stocks, Prediction Markets, OTC Trading, etc. FTX has a large number of features and benefits and is a healthy exchange that offers almost all of its traditional (Spot, Futures, Staking, 2FA, etc.) and many new services (Tokenized Stocks, Leveraged Tokens, Prediction Markets, etc.).
Advantages of the FTX exchange.
1. User-friendly interface
2. Interactive mobile application (for Android and iOS users)
3. Large community and social media presence
4. The exchange has a 3-layer liquidity protocol and FTX insurance fund, providing users with great liquidity
5. Low exchange fees
6. Expertise in the field of management
7. Like Binance, the FTX exchange has an internal governance token called FTT, which can also be pledged for pledge rewards.
6、Gemini
Official website: https://www.gemini.com/
Launched in 2014 by Tyler and Cameron Winklevoss, Gemini is known for its high focus on security and compliance. The New York-based exchange has hot wallet insurance to ensure that user funds remain safe in the event of a security breach. In addition, it requires users to complete an identity verification process to reduce the likelihood of fraud.
Gemini also encourages users to use dual authentication to protect their accounts and offers the option to review and approve the devices used to log into their trading accounts. another outstanding security feature of Gemini is that it is SOC 2 certified, which means that third-party auditors have verified the company's security and compliance framework.
Built for advanced traders, Gemini offers a professional-grade trading dashboard that supports over 75 digital currencies and tokens. Gemini also offers cryptocurrency rewards cards that allow users to purchase goods and services using cryptocurrencies.
Advantages of the Gemini exchange.
1. Available to users in all 50 US states
2. Highly liquid exchange
3. Secure funds in hot wallets
4. Strong security framework
5. One of the few US cryptocurrency exchanges to receive BitLicense
6. Insured by Lloyd's of London
7、Coinbase
Official website: https://www.coinbase.com/
Coinbase is not only an exchange but also a cryptocurrency wallet. It attracts major players and is definitely one of the largest sites. coinbase supports four major cryptocurrencies: Ethereum, bitcoin, bitcoin cash and litecoin. There is a referral system, mobile app and deposit insurance.
Advantages of Coinbase Exchange.
1. More than 10 million customers.
2. official support customers from 32 countries.
3. in spring 2017, the creation of Token messenger was announced. analogous to WeChat, which allows you to make digital payments
4. orders to buy cryptocurrencies are executed very quickly. coinbase buys and sells cryptocurrencies directly from users. No need to wait for a second party to enter the market.
5. instant withdrawals, withdrawal fees of up to 1.5% of the transaction amount and a minimum of $0.55. Wire transfer of $25. Fees vary depending on location and payment method.
8、KuCoin
Official website: https://www.kucoin.com/
Kucoin remains a young, ambitious and very promising cryptocurrency exchange with its own cryptocurrency, which started operations on September 15, 2017. The goal of the creator team is to get into the top ten and then top five cryptocurrency exchanges worldwide and to surpass the success and popularity of the Coinan exchange.
The Kucoin exchange operates in ten different languages, including Russian. With a talented team of experts, Anthem is using the most innovative technologies for development and further promotion to ensure the stable and uninterrupted operation of the project. The complex technical architecture of the exchange is based on an approach that uses the maximum possible data flow without technical failures, freezes and performance degradation. Active promotion of this resource provides the opportunity to make money for all users.
Advantages of Coin Exchange.
1. large number of transactions: > 300 transaction directions.
2. the ability to allow anonymous transactions without mandatory verification.
3. low commissions for withdrawals before they are completely non-existent (for example, for NEO)
4. a large number of specialized technical tools for analysis and chart construction of trading view strategies.
5. high level of security and protection of the client's monetary assets.
6. Competent and responsive technical support capable of quickly solving user problems.
How to use cryptocurrency exchange?
The most basic trading process for cryptocurrencies: trading in the cryptocurrency market is 7*24 hours and market changes are measured in seconds. So how to make a complete and basic trading process through an exchange?
1. Compare cryptocurrency exchanges and find the one that offers the right service for you.
2. Register an account on the platform for accessing the cryptocurrency exchange, including providing any personal details and required identification.
3. Login to the exchange, and inside the transaction you will first need to make a cryptocurrency top-up. Navigate to the "Buy" screen.
4. Select usdt as the cryptocurrency you want to buy. There is commonly known as digital dollars because they can be used to buy/invest in other mainstream coins or cryptocurrencies. If you want to use it to buy other cryptocurrencies for trading, you need to do a transfer of cryptocurrencies between sub-accounts, such as transferring USDT from a fiat currency sub-account to cryptocurrency trading sub-account. Once the funds have been transferred to the cryptocurrency trading sub-account, you can buy other currencies for trading.
5. Select your payment currency, in this case USD, and specify the amount you want to spend.
6. Choose your payment method, such as credit card payment or bank transfer.
7. Enter your payment details, for example, your account number if sending a bank transfer, or your card number and CVV if paying by credit card.
8. View full details of your transaction, including the applicable fees and the amount of USDT you purchased.
9. If you wish to proceed, click "Buy USDT".
10. After the transaction is processed, the USDT will be deposited to your exchange wallet. Please note, however, that some brokers will automatically send your USDT purchases to the external wallet address you specified.
11. When you need to sell your cryptocurrency after making a profit or stop loss, you can place a sell order inside the transaction, usually into USDT, and the cryptocurrency will be returned to your coin subaccount after the transaction is successful. When you need to withdraw cash, you need to transfer the cryptocurrency to the fiat currency sub-account, then find the fiat currency transaction in the trading, sell the digital assets, and specify the bank card that you initially set up for withdrawing cash.
Frequently Asked Questions
Q:Which cryptocurrency exchange has the most coins?
A:Cryptocurrency has the largest number of high quality coins.
Q:Which cryptocurrency exchange has the lowest fees?
A:There are many fees to consider when choosing an exchange. exchanges such as Kraken and FTX.US are known for their competitive transaction fees. However, in addition to this, it is important to consider deposit and withdrawal fees, account inactivity fees and spreads.
Q:Are there official exchanges?
A:Almost all cryptocurrency exchanges are registered private companies, but there is not yet one of the most important or official ones!
Q:Which site is the best?
A:We tried to collect the most user-friendly exchanges in our ratings. You can only find out the best one for you by trying the comparison in the article.
Post time: Sep-28-2022