Here’s What You Need To Look For In A Crypto Exchange
Cryptocurrencies have been around since the late 2000s. Bitcoin was the first one to be created and is still the most popular coin today. But many other digital coins joined the market a few years later to give users more options.
Acquiring these coins in the past was a hassle. The early adopters would either swap the coins with other users in online forums or mine them. These are still used by some people, but they usually require a lot of technical know-how. And as a beginner, you don’t have to go through all the daunting processes when you can simply use a crypto exchange.
What Is A Crypto Exchange?
A crypto exchange is an online platform where you can buy and sell crypto coins of your choice. The process is very straightforward, even for someone who’s buying cryptocurrencies for the first time. If you’re unsure where or how to start, you can search the web or here for the best exchange supported in your country.
It’s worth noting, though, that not all crypto exchanges you find in the market are the same and would fit your needs. So, what do you need to look for when choosing one?
To get you started on your crypto journey, here are some important factors to consider:
1. Type And Number Of Supported Coins
Today, there are more than 10,000 cryptocurrencies circulating the market, and the number keeps rising. Each of these digital currencies has its pros and cons in terms of transaction fees, price per coin, and transfer speed. Unfortunately, some crypto exchanges are still stuck with the few popular currencies.
Of course, you can find Bitcoin (BTC), Ethereum (ETH), and the like on any exchange platform, considering they’re giants in the industry. However, if you’re interested in newer coins, some crypto exchanges may not be supporting them. Therefore, it’s essential to consider the type and number of crypto coins an exchange supports before committing yourself.
Having the luxury of choosing between a dozen of prominent and obscure coins can take your crypto trading to another level. These options could also allow you to diversify your investment and counter the adverse effects of market volatility.
2. Digital Security
Security is probably the most important factor you must consider. If a crypto exchange doesn’t invest enough in cyber security, it renders all the other benefits worthless. Imagine losing all your money after a successful trading session. That would be devastating, wouldn’t it?
So, to avoid such losses, make sure you do extensive research on a crypto exchange’s security. Go through customer feedback regarding security and how quickly the company addresses any vulnerabilities.
Also, check the security features offered by the crypto exchange. The most popular – and must-have – feature is two-factor authentication (2FA). This can help minimize the risk of someone else logging into your account and accessing your funds.
In addition, the documents required during account creation can also give you an idea about the institution’s commitment to security. For instance, most of them require your national identification document and other personal data that can help them ward off imposters. Needless to say, you should be careful whenever you’re submitting such confidential information.
3. Transaction Fees
Your next question should be; how much do they charge per transaction? Many crypto exchanges charge a percentage of your funds every time you withdraw, deposit, or trade. It’s worth noting, too, that some crypto exchanges have varying fee tiers based on the user’s trade volume. Typically, the fees reduce as your trade size increases.
Every crypto exchange has a different fee structure. Therefore, it’s imperative that you read the policies and internalize them before choosing a crypto exchange. Doing so will help you plan your finances and improve your trading experience.
4. Ease Of Use
Whether you’re a first-time crypto investor or you’ve been in the game for a while now, you’d want a platform with an interface that’s easy to navigate. After all, a crypto exchange that’s too complicated can be intimidating and affect your experience.
This consideration is essential, especially since there are platforms that offer basic and straightforward interfaces. This can be good for new investors. On the other hand, some have more advanced and sophisticated layouts intended for more experienced investors.
Conclusion
Choosing the best crypto exchange can be challenging, especially if you’re a first-timer. Of course, there are many factors you’ll need to consider, but the few provided in this article can give you a good starting point. For instance, the digital security of the exchange company determines whether the rest of the benefits it offers are worth considering. The best crypto coins available and transaction fees are other factors you must keep in mind.
Remember, each of these aspects affects your trading sessions. Therefore, prioritizing them can help enhance your chances of success as a crypto trader.
