There are nearly 600 cryptocurrency exchanges worldwide, and choosing which one is right for you is no walk in the park. The following are tips to consider in making your choice of your crypto exchange much easier.
Reputation
Perhaps the most important consideration when cryptocurrency exchange rankings are concerned is reputation. Reputation is built on an aggregate of the other factors on this list, allowing would-be users to see the sentiment surrounding their prospective crypto exchanges.
There are only so many places where doing your own research takes much meaning, because it worked for someone you know does not mean it will for you. So you want to start with the good ol’ trusty Google search to begin your elimination process. You want to ask questions relating to the platform’s security, the ease of and how long it takes for withdraws and deposits, compliance with tax and other laws, how often they have downtimes, and the responsiveness of the support team.
Only when you have a shortlist should you proceed to see how well they handle the considerations soon to follow.
Geographical Restrictions
Unless you are willing to use a Virtual Private Network (VPN) to access your crypto exchange of choice, you want to ensure that the ones that make it on your shortlist are available in your country. The laws surrounding cryptocurrencies are still largely varying in most regions: legal in some areas, illegal in a couple, and grey in others. This ripples into what exchanges are allowed in that area and what services they can offer.
Examples of some crypto exchanger bigwigs and the geographical restrictions their users currently face are Binance being unavailable in Canada, Malaysia, Netherlands, and the U.S.A, and Crypto.com being unavailable in Afghanistan, Albania, and Algeria, among others.
Security
Having determined that the exchanges on your shortlist are available in your locale, the next thing to consider is how secure your funds are and how much they can protect your interests. While hacks are becoming pretty common these days and most of the popular exchanges have been successfully targeted in the past, you want to make sure that they were not hacked too often and users got their money back.
When it comes to security, you want to prioritize exchanges that require more steps for users to join the platform. Platforms that request as much information as possible make it much easier to track your money in case there’s a hack, or you make a mistake with any of your transactions.
Supported Coins
The whole idea of joining a cryptocurrency exchange is being able to exchange cryptocurrency, as a result, the best exchanges would be ones that allow you to access the most number of cryptos on their platforms. It is especially handy for people who are not just looking to passively hold crypto in their wallet but looking to invest and trade between crypto options in the hopes of turning a profit. Having more and quicker access to these cryptos can make all the difference to your bottom line.
Number of fiat currencies supported
Just as important as the number of cryptos you can access on the platform are the different fiat currencies available. Your preferred crypto exchange should allow you to deposit and withdraw funds in as many fiat options as possible. It gives you the option to be able to transact in fiat and this is especially handy in scenarios where your go-to crypto options are experiencing extreme volatility.
Beyond the usual currency pairs like USD, GBP, and EUR, your exchange of choice should offer more options from across the world that can allow you to take advantage of some unique opportunities to make a profit.
Liquidity
The liquidity talks about the ease with which cryptocurrencies can be exchanged for each other and how quickly they can be withdrawn, either as crypto or fiat. Exchanges with more trading volumes are likely to have more liquidity, they allow you readily access your funds and are inherently more secure to use.
Regulatory Compliance
One of the most important considerations when deciding who helps you keep your money is where they are licensed and how much they comply with regulations. You want to check with as many Google searches as possible if the exchange has come under any regulatory scrutiny in recent times, you want to see what they were investigated for and how many times they have had run-ins with the law.
You also want to check out what agencies they are licensed with and cross-check the legitimacy of their licenses on the web pages of those agencies.
Ease of Use
And lastly, the crypto exchange’s ease of use. You want an exchange that is available on iOS, Android, Windows, and Mac, so there’s no restriction when you are shopping for devices. You want one with quick login features so you can move across your devices effortlessly, perhaps with a master login or biometric access. The interface should be easy to understand at first glance, allowing you to get the most utility without stumbling over features you do not need with near endless withdraw and deposit options for the most convenience.