A cryptocurrency exchange is a platform where you can buy and sell digital assets or trade tokens on an ongoing basis. The online service earns on conducting transactions and for this provides traders with a set of tools for conducting transactions. The main difficulty is choosing a service that will meet the requirements of reliability, liquidity and security. Below is an overview of the main recommendations for beginners to decide on the platform.
Criteria for choosing a cryptocurrency exchange
Choosing a crypto exchange is a set of steps aimed at studying the interface, working conditions, registration rules and other features.
The basic criteria include:
1. Types of platform. There are three types of cryptocurrency exchanges - centralized, decentralized and P2P. The former are regulated by special authorities and require verification. The latter allow you to remain anonymous and are not controlled by any authority. Still others provide for an exchange market between users, and the platform acts as an intermediary.
2. Network commission. When choosing a cryptocurrency exchange, it is important to look at the amount of additional payments. Money may be charged for replenishment of the balance, withdrawal of money, conducting trading operations and conversion. The lower these payments, the better for the client.
3. Legal issue. A cryptocurrency exchange must have a license to operate. The main ones include the following permits: DLT (Gibraltar), FinCEN (United States), Fintrac (Canada) and others. The absence of a document indicates illegal activities and platform fraud.
4. Interface. A quality exchange should be convenient and understandable for beginners. This applies to menus, buy or sell transactions, placing orders and other actions. A person must quickly understand the capabilities of the platform, even without special knowledge. There are many cases when a user encountered an incomprehensible interface and chose another service.
5. Liquidity. To earn money, a cryptocurrency exchange must be popular. At a minimum, this applies to key assets that are in high demand. Exchange participants should easily buy and sell cryptocurrencies.
6. Working life and reputation. Verified platforms must have been operating for at least 2 years and have a positive reputation. The presence of negative reviews may indicate fraud on the part of the platform. It is better to avoid such services.