Crypto Gone Mad? How to Pick a Cryptocurrency Exchange
By Dima Zaitsev on January 29, 2018
Bitcoin has gone crazy, and so have its prices. Many people are afraid of missing out on the opportunity to get wealthy from it. As a result, some are trying to buy every cryptocurrency they can. And that’s exactly why this article is being written — to help you choose your exchange wisely.
Getting Started with Crypto
The first thing you need to know about cryptocurrencies is that there are thousands of them — some way worse than others. It’s important for beginners to avoid getting lost in different cryptocurrencies and focus on the most popular ones like Bitcoin, Ethereum, Ripple and Litecoin. This will help them learn the basics of trading without overwhelming themselves with possibilities. Because if these newcomers start buying into every single cryptocurrency at once, they might lose a lot of money doing so. The best strategy is to try trading with one cryptocurrency at first, then move onto the next one only once you feel comfortable.
Choosing an Exchange
Crypto Gone Mad? How to Pick a Cryptocurrency Exchange
If you are reading this article then you are probably looking into investing in cryptocurrency. If this is the case, then you most likely have questions about exchanges, especially if you are new to cryptocurrencies.
In fact, we would go as far as saying that choosing an exchange is one of the most important decisions that you can make when it comes to investing in cryptocurrencies. For example, how do you know which exchange will give you the best rates?
In this article, we will help answer some common questions that people have about exchanges and how they work. We will look at the different types of cryptocurrency exchanges, as well as how to decide which one is right for your specific needs.
How Cryptocurrency Exchange Works
As mentioned above, it is important to remember that there are different types of cryptocurrency exchanges. Each one has its own strengths and weaknesses, so it is important to understand what each one offers before deciding which one is right for you.
So let’s get started…
Are you wondering how to pick a cryptocurrency exchange?
If so, you’re not alone. There is no shortage of cryptocurrency exchanges and picking one can be overwhelming.
In this article we explain what cryptocurrency exchanges are and teach you how to evaluate them to make the best investment decisions.
What Is A Cryptocurrency Exchange?
Which is the best cryptocurrency exchange? In this blog I will cover the major exchanges, their pros and cons, and how to pick the best one for you.
The best cryptocurrency exchange will depend on a few factors.
1) What currencies you want to trade?
2) How much money you have?
3) How liquid do you need your money to be?
4) The fees that are charged.
5) Your location and which exchanges allow you in your country.
6) How safe do you want your funds to be? Do you want cold storage or hot wallet storage?
7) How easy is it for you to use the interface? Do you prefer a web platform or an app? And how user-friendly is it?
The demand for cryptocurrency is on the rise, and it has led to exchanges being set up in places that are still untouched by cryptocurrency.
Unfortunately, this growth in popularity has not been seen by all exchanges equally. As a result, some of the best exchanges for trading cryptocurrency have been overwhelmed with new signups. This means that new users can’t register or buy cryptocurrency on these exchanges. If you want to buy cryptocurrency now, you need to work out which exchanges are accepting new registrations and which ones aren’t.
So, how do you pick a cryptocurrency exchange?
What You Need To Know Before You Pick A Cryptocurrency Exchange
There are a few things to consider before we start looking at individual exchanges:
Accessibility: How available is the exchange? Is it open 24/7? Does it have an app? Are there any country restrictions? How easy and fast is it to deposit money into your account?
Fees: What fees does the exchange charge? Is there a deposit fee, a withdrawal fee and/or trading fees? What currencies do they accept?
Countries Supported: Where is the exchange located, and what countries are supported by the exchange?
Reputation: What do others say about the exchange, and what’s its general reputation
A few days ago, the crypto market went crazy. The top ten coins all rose by double-digit percentages. Bitcoin rose by 10 percent and Ethereum by 14 percent.
There was no significant news. Instead, this rise seems to have been caused by a bunch of retail investors buying into crypto. It reminded me of the mania of 2017, when I was regularly getting emails from friends asking me what they should do with their money.
If you’re new to the space and are looking to buy cryptocurrencies for the first time, there are different methods that you can use. These include buying on exchanges directly, peer-to-peer markets, and over-the-counter (OTC) trades.
Cryptocurrency prices today are up and down. The market is volatile and the price of bitcoin is going up and down in a matter of seconds. 30 seconds ago, Bitcoin was trading at $8,200 and now it’s dropped to $7,900. This happens all day long with every cryptocurrency that exists.
How do these exchanges pick what the price of something is? How do they know how much to charge for Bitcoin or Litecoin or every other coin available?
Exchanges set their own prices
Cryptocurrency exchanges have no way of knowing what anything is worth. There are no central banks controlling the prices or giving them orders on what to charge. Exchanges set their own prices based on supply and demand from their users.
Arbitrage between exchanges
The price of an asset like Bitcoin will vary from exchange to exchange, which creates an opportunity for arbitrage — buying at one exchange where the price is low, then selling at another where the price is high. The more liquid the market, the easier it will be for people to take advantage of this strategy.