There are hundreds of cryptocurrency exchanges available online today, including top 10 exchanges with high liquidity and smaller exchanges with more unique coin selections.
Which exchange is right for you? Choosing the right exchange can be a confusing process. In this chapter, we’ll list the most popular cryptocurrency exchanges available today. We’ll also explain what you should look for in a good cryptocurrency exchange.
Top 5 Ways to Choose the Best Cryptocurrency Exchange
What should you consider when shopping between cryptocurrency exchanges? Here are some of the most important factors when comparing exchanges:
Fees: Most of the biggest exchanges have competitive fee structures. Unless you’re dealing with a niche, specialized exchange – like a regional exchange or an exchange for a specific country – you’re unlikely going to encounter fees above 0.5% on standard trading. Nevertheless, it’s always a good idea to check an exchange’s maker fees and taker fees to make sure they’re competitive.
Volume Discounts: Are you a high-volume trader? If you plan on trading, say, more than $50,000 per month across all cryptocurrencies, then you might qualify for high-volume trading discounts at certain exchanges. Exchanges like to attract the biggest cryptocurrency holders, and they do that by offering competitive fees. The higher your trading volume is, the lower your fees will be. Some exchanges drop fees to virtually 0% for the highest volume traders.
Payment and Withdrawal Options: Some exchanges do not accept fiat currencies. They only accept cryptocurrency deposits and withdrawals. Other exchanges are totally compliant with banking systems and allow easy bank transfers or wire transfers. Exchanges have a number of different withdrawal and deposit options. Check payment and withdrawal methods to make sure they work for your needs.
Location: The location of an exchange is important. You might want to work with a locally-based exchange to transfer your fiat currency into cryptocurrency for the first time. A major exchange like Bittrex might not accept regional payment methods like INTERAC for Canadian Dollars or BPAY for Australian Dollars. However, smaller Canada or Australia-based exchanges will accept both of these transfer methods. Location is also important in terms of regulation. Many exchanges are based in the United States and are fully-compliant with US banking laws. Other exchanges operate in a grey area by registering themselves in a little-known country and operating by the obscure regulations of that country.
Reputation, Customer Service, and Other Factors: Exchanges vary widely in terms of customer service, reputation, and other factors. The good exchanges have risen to the top because they have a proven track record of providing a superior customer experience.
Top 10 Cryptocurrency Exchanges for 2018
Coinbase is headquartered in San Francisco. The exchange was founded in 2011 and is one of the most-popular and best-known exchanges on the internet today. Coinbase is more of a payment platform than an exchange: it facilitates easy payments using credit cards and other popular payment methods. Coinbase charges a high fee of as much as 5% for certain credit card payments, but it also offers unparalleled convenience and a US-compliant regulatory structure.
GDAX is the cryptocurrency exchange division of Coinbase. They’re run by the same back-end. The main difference with GDAX is that it offers a more conventional exchange interface – complete with buy and sell orders and a transparent matching engine. If you’re looking for a beginner-friendly way to buy cryptocurrency for the first time, then Coinbase is a good option. If you’re okay with dealing with a more advanced interface similar to what you’d see on a conventional exchange, then GDAX is a popular cryptocurrency exchange offering competitive fees and a diverse range of coins.
Kraken launched in 2011 in San Francisco. Today, Kraken typically sits among the top 10 or top 15 cryptocurrency exchanges by trading volume. Traders enjoy competitive fees while dealing with major cryptocurrency trading pairs, including BTC/EUR, ETH/EUR, BTC/USD, ETH/BTC, and XRP/EUR, among many others.
Binance is one of the newest cryptocurrency exchanges on the market. Launched in 2017, it quickly grew to become one of the highest-volume exchanges on the internet. Today, it routinely sits in the number one spot in terms of 24 hour trading volume. Binance is popular for its use of Binance Coin (BNB), which allows token holders to get steep discounts on trading fees. Binance also has a competitive fee structure and a diverse selection of cryptocurrencies from which to choose.
OKEx is a popular digital currency exchange offering competitive fees and strong liquidity across a diverse selection of trading pairs. It’s a user-friendly exchange registered in the UK.
Huobi is a Beijing-based cryptocurrency trading platform that is rapidly opening exchanges around the world. Today, Huobi is routinely ranked in the top 5 cryptocurrency exchanges by trading volume. Like Binance, Huobi has its own token (the Huobi Token or HT) that provides steep discounts on trading fees. As with all other exchanges on this list, Huobi offers competitive fees, strong liquidity, a compliant environment, and an easy trading interface.
Bitfinex is one of the best-known exchanges available today. Bitfinex’s parent company, iFinex Inc., is headquartered in Hong Kong. Today, Bitfinex serves customers in 50+ countries worldwide. Bitfinex is one of the most controversial exchanges in our list of top exchanges. In 2015, the exchange was hacked. The exchange has also faced criticism for its connection with the controversial Tether cryptocurrency. According to reports online, the CEO of Tether and Bitfinex is the same person. Despite the controversy, Bitfinex remains one of the largest and most popular exchanges by trading volume.
Bittrex is a popular top 10 cryptocurrency exchange that, like others on this list, offers competitive fees, diverse deposit and withdrawal options, an easy interface, and a range of different cryptocurrency trading pairs. Bittrex is headquartered in Seattle with an office in Las Vegas.
Gemini is a popular New York-based cryptocurrency exchange founded in 2015 by the Winklevoss twins – yes, the same Winklevoss twins that were linked with Facebook. Gemini remains one of the most popular and highest-volume exchanges online today. The exchange is also attempting to be one of the first major exchanges to target the institutional trading crowd in a major way.
LocalBitcoins is worth a mention here. It’s not strictly a cryptocurrency exchange. Instead, it’s kind of like Craigslist for individual cryptocurrency exchanges. You can use LocalBitcoins to find a bitcoin buyer or seller in your local area. You can arrange in-person cash transfers with that individual. Or, you can deposit money into a bank account of that person’s choice and then receive an instant bitcoin transfer in return. The marketplace charges a small fee in exchange for holding funds in escrow and tracking the reputation of merchants across the platform. If you want to buy or sell cryptocurrencies without messing around on an exchange, then LocalBitcoins might be your preferred method.
There are – quite literally – hundreds of cryptocurrency exchanges available today. These exchanges vary widely in terms of popularity, regulations, coin variety, and other factors. If you’re working with the top 10 cryptocurrency exchanges, you’re going to find a similar experience across all of the options listed above. All of the above exchanges offer competitive fees, strong liquidity, easy deposits and withdrawals, and decent customer service.
In the next chapter, we’ll explain how you can start trading cryptocurrencies on a popular exchange. By following the lessons in the next chapter, you can buy your first bitcoin or crypto within a few hours!