Invest with confidence: the best cryptocurrency exchanges

Cryptocurrencies are digital currencies that, unlike physical money, are decentralized and not backed by an official authority. To exchange these digital assets for money, you can use exchange houses: physical establishments that offer assistance and ATMs to exchange cryptocurrencies as if it were a traditional exchange office.

While a traditional bank is responsible for keeping track of our money and we can withdraw it in cash from an ATM, in the case of cryptocurrencies we can go to an exchange: platforms that allow us to exchange these cryptocurrencies for regular money or other cryptocurrencies. Exchanges cryptocurrency typically operate through digital wallets. But some platforms also have exchange houses: physical establishments that offer money to digital exchanges faster. In these types of establishments, users can create their digital wallet or buy and sell cryptocurrency, exchanging it for physical money at ATMs located inside. These stores operate very similarly to traditional exchange houses, as the basic business model is to charge a commission on each exchange, whether it is a purchase or a sale.

A cryptocurrency exchange is a platform where you can trade cryptocurrencies and digital assets. In other words, you can buy, sell, trade, and make other types of investments, such as putting your coins on a card or getting cryptocurrency loans. Exchanges have evolved from cryptocurrency exchanges into more complete investment platforms. However, they only work with digital assets. 

A centralized crypto exchange operates essentially the same as classic asset exchange platforms, the difference being what is traded: in this case, crypto pairs (LTC/BTC) or crypto/BTC pairs, the high volatility of these pairs usually attracts users to trading platforms. These platforms earn income in a variety of ways, although the most important ones are trading volume fees.

As you already know, there are different types of cryptocurrency exchanges. Even within CEXs (centralized) and DEXs (decentralized), there are many differences. How to choose the best exchanges? What features should an ideal cryptocurrency investment platform have? Let’s take a closer look at them.

Centralized exchanges	Decentralized exchanges
Centralized Exchanges or CEXs are the most well-known. They are called that because they are run by a company that acts as an intermediary, similar to a broker but with crypto assets. These types of platforms handle cryptocurrencies and fiat currencies, offer more features, and typically have more liquidity than decentralized exchanges.	Decentralized exchanges or DEXs, are cleaner platforms in terms of cryptocurrencies. There is no company or central authority, and the users themselves control the information and have their own private keys. These types of cryptocurrency exchanges may have more liquidity issues, but in return, they represent a cleaner formula for using blockchain.

There are different types of platforms in the market where you can buy and sell cryptocurrencies. Below are the most important of them with their advantages and disadvantages.

Huobi

Founded in China in 2013, Huobi caters to intermediate to advanced traders. There are spot markets with over 200 assets, you can trade derivatives, and participate in the margin market and prime brokerage. Following the closure of its China business in 2021, its operations are now carried out from Singapore. It is regulated in Gibraltar, Japan, and Luxembourg.

Advantages:

1. 350 cryptocurrencies, including Bitcoin, Ethereum, Dogecoin, Ripple, and more;
2. The trading commissions are among the lowest in the market;
3. The platform features two-factor authentication, cold storage, and protection against cyber attacks.

Disadvantages:

• Any financial authority does not regulate it and does not accept users from the United States or Japan.

Binance

Binance is the largest and most important exchange in the world. So much so that its native token BNB is the fourth largest by market capitalization. More than 150 million people use its platform. Binance combines offering, security, and service. As an exchange, it works with over 600 cryptocurrencies offering advanced trading tools, various systems for generating income through staking and farming, NFT transactions, various order types, loans, and token launch tools. Binance is very functional, but it is probably not the best exchange for a new investor.

Advantages:

1. The largest platform in the world, more liquidity;
2. Huge range of products;
3. Regulation: SEC, FCA, CNMV;
4. Commissions: 0.1% maker – 0.1% taker;
5. Training academy, cryptocurrency staking and earn systems, wallet, card, loans, API, pay, and mining pool.

Disadvantages:

• It may be difficult for new crypto enthusiasts.

WhiteBit

WhiteBIT is the largest centralized cryptocurrency exchange in Europe, founded in 2018. Today the company employs more than 600 professionals. The top cryptocurrency exchange has more than 350 trading pairs, more than 270 assets, and 6 national currencies. The average highest day volume is $2.5 billion. WhiteBIT has over 3.5 million registered users worldwide. Its goal is to introduce blockchain technology and grow the cryptocurrency community by offering a secure and easy-to-use platform.

Advantages:

1. Included in the list of the 3 safest exchanges with the highest AAA rating;
2. Security of customer funds: 96% of digital assets are stored in cold wallets, and a web application firewall (WAF) is used to detect and block hacker attacks;
3. Beginner-friendly interface of the basic trading page;
4. Passive income option with high interest;
5. More than 400 trading pairs.

Disadvantages:

• There are no alternative investment options.

Crypto.com

Crypto.com has become one of Europe’s top cryptocurrency exchange platforms, showing impressive growth. With around 50 million users, it positions itself as one of the largest exchanges in the world, directly competing with giants like Binance. This platform offers a wide range of services, from cryptocurrency exchange and trading options to a debit card connected to your account for making cryptocurrency payments.

Advantages:

1. Wide selection of over 250 cryptocurrencies;
2. Crypto.com allows you to make instant deposits using credit or debit cards;
3. Intuitive interface;
4. Staking options.

Disadvantages:

• Crypto.com only allows withdrawals in some fiat currencies such as EUR, USD, or GBP.

Bybit

Bybit, based in the United Arab Emirates, is one of the largest cryptocurrency and derivatives exchanges. With a mission to revolutionize the current financial system, they are trying to make trading inclusive and efficient for everyone. It provides trading services for Bitcoin (BTC), Ethereum (ETH), and other cryptocurrencies. Its emphasis on security, ease of use, and innovative features make it the preferred choice of many traders.

Advantages:

1. Leverage trading;
2. Wide range of cryptocurrencies;
3. High-security measures;
4. Advanced trading features.

Disadvantages:

• No direct bank withdrawals.

Key considerations when choosing a cryptocurrency exchange

The key point when investing in cryptocurrencies is security. The first thing you should ask for in an exchange is reliability. Ultimately, you don’t want a hacker to be able to gain access to your crypto assets, which happens from time to time in the cryptocurrency market. What determines the security of an exchange? Encryption standards to start with and security of funds to continue. This presupposes provisions for specific funds and insurance.

Most exchanges work with major cryptocurrencies such as Bitcoin, Ethereum, Tether, XRP, or Cardano. The best cryptocurrency exchanges go further and offer more exotic cryptocurrencies. As an investor, you don’t need to have access to all of them, but you do need to have at least 100 tokens/cryptocurrencies. One of the advantages of large DEX and CEX exchanges is that they are the platform on which cryptocurrencies debut after pre-sales or ICOs close.

The impact of fees on your profitability does not change because you are dealing with cryptocurrencies. Any fee you pay more is a return of less than you receive. When dealing with cryptocurrencies, there are fees for withdrawals, transfers, currency conversion, and transaction fees. As such, exchanges typically differentiate between takers and makers when charging fees. The difference between both concepts is as follows:

• Taker: A trading operation that places an order at the market price.
• Maker: A trading operation that places an order at a limited price.

It is also important to review the services and products you work with. Some exchanges are more advanced than others. Classic value-added services include the training area and resources that the exchange devotes to training its users, as well as analysis or current events services. Services such as exchanges for cryptocurrency loans, betting, farming, and other earning methods also fall into this category, regardless of whether they have an API to work with your software.

It is recommended to look for an exchange that is quick to respond, accessible, easy to contact, and helps you in your language.