It can be tough enough to purchase BTC, ETH, or any other cryptocurrency using cold hard cash, so in this article we’ll guide you through the best cryptocurrency exchanges to use. But before handing over your hard-earned cash, there are a few things to consider when choosing an exchange.
Are you looking to buy coins with a credit or debit card, or do you want to trade coins for other coins? Do you want to interact with an exchange, who will hold the coins on your behalf, or are you happy to configure wallets and negotiate the deal yourself?
And here are a few more things to consider:
Reputation. Before anything else, is the cryptocurrency exchange reputable? Does it have a solid history without bungling payments, withholding user funds, or stealing everyone’s currency? The big exchanges listed below may have occasional minor issues, but they have generally proven themselves to be trustworthy and reliable.
Fees. Next up, how much is it going to cost you to use the exchange? The vast majority of exchanges charge a nominal percentage of your transaction, varying between exchanges. You don’t want to pay over the odds. But sometimes paying more secures a better overall experience, so it is about finding a happy balance.
Payment Types. How many different ways can you purchase cryptocurrencies on the exchange? Do they accept bank transfers? Debit and credit cards? Few sites accept PayPal as a valid payment type due to the high risk of fraudulent transactions (stolen accounts and so on).
Verification The vast majority of sites require at least some form of user identification. Verification varies between sites but usually involves a driver’s license, passport, or similar. Some sites require multiple forms of user identification before allowing access.
Geography. Does the exchange have any geographical limitations? Some cryptocurrency exchanges only serve customers in certain locations.
1. Binance
Binance is one of the top cryptocurrency exchanges by both trading volume and usability. Often the first of the big exchanges to list a new coin, Binance offer a substantial number of cryptocurrencies
Binance has traditionally been a strictly crypto-to-crypto exchange, with all trading pegged relative to Bitcoin, Ethereum, USDT (Tether), or Binance’s in-house currency, BNB. Recently, Binance has started opening fiat trading pairs in selected countries. Hopefully, this will open up around the world given time.
The Binance interface is slightly clunky, but advanced users will quickly find their way around. Newcomers might need some extra time, but it isn’t overwhelming. Finally, Binance trading fees vary between 0.05% and 0.1%, which is quite reasonable.
Useful for: Intermediate users and onwards, day traders.
Not useful for: Trading fiat currency, beginners.
2. Bitfinex
Bitfinex is another huge exchange. Trading over $300 million a day, you can be sure to find a buyer here. With an interface very similar to Coinbase Pro (see below), you’ll soon pick up the basics.
Not only can you trade a huge variety of coins, but Bitfinex allows funding via wire transfer, and trading of fiat currencies USD, EUR, GBP, and JPY.
Bitfinex fees start at 0.1% for selling and 0.2% for buying. While not the lowest around, this is still very reasonable. If you’re a big spender, then fees continue to go down the more you trade every month.
There is one blot on Bitfinex’s record, however. Bifinex lost 120,000 Bitcoins through a hack in 2016. This was worth $72 million at the time and is the second largest hack of all time. Bitfinex issued an “IOU” in the form of the BFX token. While there was some skepticism around this, Bitfinex were true to their word and redeemed 100% of the BFX tokens. Want to know more? Read about the biggest cryptocurrency hacks.
Useful for: Intermediate users and onwards, day traders.
Not useful for: Absolute beginners.
3. Bittrex
Founded in 2015, Bittrex has a reputation for stability and reliability.
With a very similar interface to Bitfinex, you’ll have no problem making trades if you’ve used any other exchange.
All trades have a 0.25% commission, which is higher than most exchanges. This is still insignificant, as it’s almost low enough to trade without concern.
Bittrex has recently introduced USD trading pairs, which continues to be accessible to more and more countries, as Bittrex rolls this out in a staggered release.
Useful for: Intermediate users and onwards, day traders.
Not useful for: Absolute beginners.
4. Coinbase/Coinbase Pro
Coinbase was one of the first websites to let you use your bank account to buy cryptocurrencies. While technically Coinbase is a broker, their exchange subsidiary Coinbase Pro (formerly GDAX) handles trading.
Coinbase fees are on the high side compared to many other websites, and there have been rumors of inside trading when listing new coins (such as Bitcoin Cash), but you’ll find Coinbase is generally a good place to start for an absolute beginner, as well as a good way to cash out to your local currency.
The Coinbase interface is easy to use, and you can transfer finances between Coinbase and Coinbase Pro without incurring any fees.
To keep things simple, Coinbase only lists four cryptocurrencies: Bitcoin, Bitcoin Cash, Ethereum, and Litecoin. If you’re worried about security, but don’t want to store your own coins, then Coinbase Pro insure all their accounts, up to $250,000 per customer.
Coinbase is often used as a starting point. A good place for a beginner to buy from, and an easy entry point to trade fiat currency for cryptocurrency, and then shuffle those coins onto another exchange.
Useful for: Absolute beginners.
Not useful for: Day traders, those looking for altcoins.
5. Local Bitcoins
The final cryptocurrency exchange to check out is LocalBitcoins. LocalBitcoins is a peer-to-peer Bitcoin exchange. Users contact the buyer or seller listing Bitcoin at a price they agree with, as well as a payment or sale method. LocalBitcoin vendors accept a staggering range of transaction methods, including gift card codes, PayPal, altcoins, wire transfers and more.
The combination of sales and payment methods, and vendors working in “248 countries” makes LocalBitcoins one of the most popular Bitcoin exchanges around.
Furthermore, LocalBitcoins is an instant trade platform. Depending on your payment method, your transaction might be over in minutes. And finally, the LocalBitcoins interface is one of the easiest to use, allowing you to sort vendors by country, payment type, currency type, and more.
Useful for: Quick fiat-Bitcoin transactions, some altcoins, all user abilities.
Not useful for: Swing trading, crypto-to-crypto, day trading.
Are Other Cryptocurrency Exchanges Worthwhile?
There are more cryptocurrency exchanges out there. A lot more, in fact. Some users won’t agree with the cryptocurrency exchanges on this list, either, because everyone has their preferences. But these five exchanges represent a blend of beginners-to-advanced tools, tools for day and swing trading, and quick crypto-fiat transactions.
The most important thing to remember is remaining secure with a solid cryptocurrency wallet!
Read the full article: Where to Buy Cryptocurrency: The 5 Best Crypto Exchanges
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