Digitalization has undoubtedly contributed to the popularization of cryptocurrencies. Many people have bought into the trend, and trade volumes have significantly increased, which proves this. Cryptocurrency certainly has elements that a lot of features gravitate towards. However, it’s still a very volatile asset to hold.
Crypto exchanges facilitate the buying and selling of various cryptocurrencies. There are generally many exchanges to choose from. Every platform is different, and every user (or trader) has different needs. Therefore, not every exchange is the same and could be ideal for every trader. Users will gravitate to certain ones more than others based on their needs. So, you need to look for the exchange that aligns with you.
That said, here are some key features to look for when choosing a crypto exchange.
1. Accessibility
Accessibility matters. You need to confirm whether the crypto exchanges you’re looking for work in your location. Note that some locations may be barred from engaging in crypto trading entirely or partially by their governments. As such, you need to factor this in before taking a plunge mindlessly.More so, some countries or regions may have specific regulations that affect cryptocurrency trading. You certainly don’t want to be caught off guard. Therefore, ensure that your partnership with an exchange is accessible to you based on your location.
2. User Experience and Interface
As previously mentioned, different exchanges work differently. That could also go for their processes and user experience. Whether you are an experienced investor or not, the exchange platform you use should ideally be simple and intuitive.Usability is crucial as it can refine the entire user experience. It could take time to adjust to newer platforms, but an excellent interface can make it easier for the user to navigate the website or application.
Often, developers may fall into the trap of cramping features and functionalities at the expense of usability. Most users may opt for a platform with helpful features which are navigable over an unnecessarily complicated platform. As such, you can also look for one that is properly optimized with relevant features and integrated with security features. To know more about factors that streamline crypto trading, see it here.
3. Charges And Other Fees
Before you trade, make sure you understand the exchange’s fee structure. Some exchanges may have a fixed fee, but most work with percentages. The fees you’re charged may also differ based on whether you’re the seller or the buyer and the type of currency you’re trading. And so, you need to confirm the fees because they eat at your profits. In addition, you also need to know how much every exchange charges per transaction.With that in mind, don’t be discouraged from partnering with exchanges that have high fees if they’re justified. Perhaps they charge those for a good reason, such as additional security and insurance. Regardless of the case, it’s always advisable you confirm this beforehand.
4. Range Of Coins
Aside from the popular cryptocurrencies such as Bitcoin and Ethereum, there are plenty of other alternatives. If you’re a beginner, it may be advisable to stick with the popular ones since they are more abundant.However, note that the cryptocurrency market is already volatile as-is, and altcoins can be relatively riskier to invest in. But on the other hand, they could also help you diversify your portfolio. And so, in that case, consider looking for exchanges that offer a diverse range of coins. Before you partner with any exchange, you can check whether they have the coins you’re interested in trading or investing in.
5. Informative Platform
For beginners, knowledge about crypto trading may be limited. That said, it would make sense for a beginner to look for a platform that offers features and tools they can use to educate themselves more regarding the crypto options or coins available.There are some platforms with educational tools in the form of videos and quizzes through which you can bolster your knowledge about cryptocurrencies. Such programs do an excellent job of simplifying potentially complicated concepts for starters, which can be a good bargain for any beginner.
6. Liquidity
If you’re going to be trading crypto regularly, you would need to use a platform that’s liquid. Ideally, you should be able to initiate and close trades on that platform on demand. But that requires liquidity.More prominent exchanges have the upper hand in this instance since trade volumes are usually high there. They’re more likely to be liquid compared to smaller ones. Exchanges with higher trade volumes enable you to get the best price for every trade. Remember, cryptocurrency is a volatile asset, and prices and values change fast. Therefore, you need a reliable exchange with liquidity that gives you the keys and confidence to trade at any time.
7. Security
Generally, there’s no central institution controlling or regulating the trade of currencies on any platform as it’s a decentralized system. While crypto is relatively secure, cybersecurity threats have been on the rise. Hackers are now using sophisticated ways of accessing confidential information. And with that, it would be best to protect yourself and your investment.With exchanges, you can look for platforms that have additional security measures that protect your account. Moreover, consider checking whether they offer any insurance policy against hackers or fraudsters. If hackers breach an exchange, insurance can secure your holdings after that attack. Some people may choose to keep their currency in the exchange before transferring it to their hot or cold wallets. Therefore, security should be a significant priority for you.
8. Customer Service
As the client, the exchange you’d want to work with should treat you well because they charge you for every transaction. But not all exchanges prioritize customer service.In crypto trading, problems may arise. As such, you may need an exchange that cares enough to attend to your needs promptly. Time is money in trading, literally. A five-minute delay can cost you a lot. So, you can’t afford to work with an unreliable exchange because it may lead to losses in the long run.
Furthermore, concerning customer service, it’s always good to research and check testimonials or reviews online. Reviews are generally accurate.
Conclusion
Every exchange may work differently. Each has different standards, processes, and service fees. With the help of the key features listed above, you can choose which one works best for you. More so, consider researching as many platforms as possible and give yourself time to learn before taking a plunge.
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