How to Select an Exchange for Crypto Trading

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Choosing an exchange to sell on is still a step into the unknown and a giant leap of confidence for a prospective crypto trader. And, though decentralised exchanges (DEXs) are similar to the core concept of cryptocurrency — eliminating a single point of failure — centralised crypto exchanges continue to dominate the cryptomarket. They are easier to use and have a much broader variety of trading options and tools. Although, most importantly, they have greater liquidity and can deal with fiat currencies.

We compared four cryptocurrency exchanges where you can trade; the top ten based on daily registered amount. Assume you swap $5,000 in BTC or ETH. Let’s look at what these channels have to sell.

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Ease of access

Account setup

Any transaction begins with a login process, and the ease and speed with which the KYC is completed determines the first user’s experience. Nothing more than an e-mail address or phone number is expected to begin on either of the platforms examined. Then you’ll get a validation code via SMS or email to prove you’re person, and you’ll be all set. It’s really that easy.

Even, we should all accept that security is the highest priority for any cryptocurrency exchange, so in order for your account to be stable, Binance, DigiFinex, CoinBene, ZBG, and Bibox all need Google Authentification to be set up as well. BitMEX and Bithumb markets would also require you to expressly specify your country in order to comply with any regulatory restrictions.

 

However, such registration does not yet constitute complete KYC-verification. The entire KYC procedure is optional on most exchanges, but some sites accept validated users with enhanced features and less withdrawal constraints. Interactions of fiat currency are restricted to authenticated users on many others. Another deciding factor is the selling or balance number — the higher it is, the more features the crypto exchange is able to provide you with.

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Deposit options

It’s no wonder that all sites accept cryptocurrency deposits because it’s a really easy operation, both theoretically and for the consumer. There are more regulatory and technological problems for a trade when it comes to fiat currency. However, seven of the thirteen exchanges examined accept fiat deposits, the majority of which are made through wire transfer. Binance and Bibox accept credit card deposits in fiat currency, while OKEx is an outlier, accepting WeChat Pay and AliPay.

Four exchanges accept USD deposits (Binance, Bibox, Bitfinex, and Bittrex), OKEx and Bitforex only accept Chinese Yen, and Bithumb only accepts South Korean Won. This leaves us with only two multi-currency fiat deposit options: Bitfinex and Bibox, with the former focused on European markets and Japanese Yen and the latter on Asia.

You will even read Crypto Head’s reviews of cryptocurrency exchanges.

 

Fees

Deposit Fees

Except for Bithumb, Bitfinex, and HitBTC, most platforms do not charge deposit fees for any approved currency, regardless of the size. There is just a’small deposit fee’ for the first two crypto exchanges (i.e. it is charged when your deposit is below a certain threshold). Just one of the more than 400 funded cryptocurrencies, BTC, is subject to a fixed deposit fee at HitBTC.

Trading Fees1

The majority of the cryptocurrency exchanges examined have set trading rates that do not differentiate between buyers and sellers, with the lowest being 0.1% on Binance, CoinBene, ZBG, and Bibox. Fees on any of them can be lowered by using network tokens or coupons.

Other networks (BitMEX, OKEx, Bit-Z, BitForex, HitBTC, and Bitfinex) have separate compensation schedules for makers and takers, which are often polar from one exchange to the next. For example, on BitForex and BitZ, the person who places the order is not paid anything. Meanwhile, on HitBTC, BitMEX, and OKEx, the fee is paid by the taker, and the maker can also collect a share of the exchange. BitZ also has a special fee reduction for licenced market makers.

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On such websites, Maker and Taker payments are often determined by contract type, trading volume, and currency. The fees that you will be paying if you trade $5000 equivalent in BTC or ETH on any of the exchanges surveyed are listed in the table below.

Withdrawal fees

When it comes to crypto trading on an exchange, withdrawal is still a challenge. The exchanges usually follow one of two patterns: charging a set amount of the currency in use or providing a zero platform charge or minimal blockchain network fee with timely withdrawal restrictions, such as BitMEX, OKEx, and CoinBene. The majority of the other platforms have devised a coin-dependent withdrawal fee system with a minimum withdrawal amount (like this of BitForex). Binance (0.0001 BTC) offers the cheapest Bitcoin withdrawal alternative, while Bitfinex offers the cheapest Ethereum withdrawal option (0.00135 ETH).

Fees

exchanges - How to Choose an Exchange When Trading Crypto

Tools and options

Where it comes to what an exchange should do, there are many requirements to consider: the amount of pairs and coins supported, base currencies, and network resources.

Supported crypto

HitBTC, as one of the oldest exchanges in the study (second only to Bitfinex), has the most base currencies (9) as well as the most crypto markets and coins backed of all crypto exchanges. Binance and OKEx are the second highest in terms of number of sets, but even when combined, they cannot outperform HitBTC on this metric. Bitfinex and Binance have the second-highest number of base currencies — 7, with the first offering four fiat currencies and the second endorsing many tethered ones.

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Tools

Aside from basic exchange functionality, most exchanges have certain exclusive features such as futures trading (BitMex, OKEx, Bitforex), tools for experienced traders, P2P lending services, and price warnings. Some have their own recommendation programmes, sharing rewards, token voting, and other group events.

Popularity2

Binance, which was established less than two years ago, is without a question the most famous cryptocurrency exchange, with 29.8 million visitors from all over the world each month. BitMEX is the second most common exchange, with 11.39 million monthly visitors and 35% of traffic coming from mobile devices despite the lack of official smartphone applications. However, Bithumb should brag about being the most user-friendly exchange, with 72 percent of the 2,4M monthly traffic coming from mobile devices.

Among the most visited exchanges, Binance is again one of the leaders in terms of geographical reach and languages supported. Bithumb’s traffic is overwhelmingly localized in the Republic of Korea and more than half of the OKEx visits come from China. BitMEX enjoys the most even geographical distribution, while the others get the highest number of visits mostly from US, Russia, and China.

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1. When Maker fee is below 0, it means that he receives this percentage of the trade as an added bonus.
2. The data was retrieved from similarweb.com in February, 2019

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