Everything You Need to Know about Cryptocurrency Exchanges

Cryptocurrency Exchanges

Do you want to get serious about trading? Or maybe you just want to buy some Bitcoins to pay your electricity bill. Well to get cryptocurrency you are going to need to use an exchange. If you are a seasoned trader of cryptos, I basically just told you that water is wet, but we all start somewhere. To make this page useful for everyone, let’s assume you have no previous knowledge or experience with crypto. you’re still standing in line to buy that ticket to the moon.

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First Things First, What is a Cryptocurrency Exchange?

According to Wikipedia, a Bitcoin exchange is a business that allows customers to trade digital currencies for other assets, such as conventional fiat money, or different digital currencies. Like most Wikipedia definitions this is factual but it doesn’t tell us much or really help us out. The goal of this site is to provide cryptocurrency exchange site reviews and make sense of all that noise, so you can find an exchange that works for you.

Trading volume comparison

Your Average Cryptocurrency Exchanges

Whether you are buying Ethereum or Bitcoin, or buying altcoins like Ark, Neo, and Dodge, the average cryptocurrency exchange is just a big old reserve of cryptocurrency. They aren’t too different from the shop down the road. You send them money, and they give you coins. Simple, right?

Well yes and no. Cryptocurrency is as simple as you make it. The market is still developing and exchanges are still taking shape to accommodate how people wish to buy and sell their crypto. if you just want to buy Bitcoin or Ethereum, you can use a user-friendly exchange like Coinspot. Nice interface clean layout, and your coins are guaranteed, insured, bundled up with a friendly welcoming tick behind them.

As you learn more about crypto and you seek out risk and reward, you can ride out to the frontiers of innovation and invest in the blockchain companies that will one day change the world (or run away with your money)

How does a Crypto Exchange Work?

While each of the cryptocurrency exchanges, understandably, have different interfaces and procedures, all have very similar processes.

  1. Register: The user needs to register with the website, choose log in credentials and log in to the exchange.
  2. KYC: Most of the exchanges would want you to get your Know Your Customer done right away, before one can start trading.
  3. Deposit: Most of the exchanges are pretty liberal and allows the customer to deposit from most leading Bitcoin accounts or directly from an Ethereum exchange. Popular Fiat Currencies are accepted as well, these include USD, Euro, GBP, JPY, CNY and more.
  4. Trade: Most of the exchanges have some software or, at least, a web based interface to transact on the exchange. The trader can use these to start trading.
  5. Liquidation: Once the user wants to take out the money invested and convert it to fiat currency again, the exchanges allow the user to send it back to the chosen bank account.

If there is no direct bank transfer possible, the user is required to go through a local crypto dealer or Forex dealer to receive the fund in local currency. The altcoin can be converted and transferred to the Bitcoin account or an Ethereum exchange, where the user can then easily transfer to their bank account.

How Can You Tell if Cryptocurrency Exchange Sites Are Reliable?

In the unregulated and decentralised market, the responsibility falls on each and every trader to find a reliable cryptocurrencies exchange. Scams happen. if you are doing some vanilla trading It is unlikely someone will run away you’re your coins, but a good bit of research is your first line of defence and a sure way to find the best exchange.

Spending some extra time to consider what’s available to you can also save you a fortune in transaction fees, speed up your transaction times and, make it easier to buy cryptocurrency with your preferred payment method.

There are all kinds of things to consider, from compatibility issues, with whatever crypto wallet you happen to be using, to which cryptocurrencies exchange is selling the altcoins you want to hold.

Types of Cryptocurrency Exchanges

There are basically 4 types of exchanges available for the users to choose from. Cex, Dex, Cryptocurrency dealers, crypto-fund managers.

  1. CEX: Cex stands for Centralised Exchanges. Whatever exchange we might know, there is a 99% probability that it is a Cex or Centralised Exchange. In centralised exchanges, every transaction goes via the central authority which is controlling the exchange.
    These cryptocurrency exchanges take a charge for every executed order. They might also charge a percentage of the deposited amount or during fund withdrawal.
  2. DEX: With the advent of decentralisation and peer to peer transactions, Dex or Decentralised Exchanges became popular. In Decentralised Exchanges, the transactions take place between two traders directly. This also eliminates the need of predefined pairs as the traders can create pairs and their prices.
    For example: a trader might want to buy a new coin called Xcoin against BTC. He simply needs to put up a Bid price and if any owner of the Xcoin agrees to the rate, they can trade. The user can pay from his Bitcoin account and receive the new coin in return.

Dex exchanges have several advantages including no or little spread, instant trading, lax regulations and insignificant trading charges. However, some experts point out the accountability factor as a disadvantage because if something goes wrong, in most of the cases, the Dex can’t help the user.

  1. Local Exchanges: These websites are more like a dealer which allow the users to buy and sell cryptocurrencies against local currencies. They generally don’t have trading facility, as such. However, many of them allow automatic buy and sell order placement. These exchanges are almost like a Bitcoin market or an Ethereum exchange.
  2. Cryptocurrency Funds: These funds work almost like mutual funds where the users can deposit their fund to a cryptocurrency trading company or manager and, with a fee, the trading is done by them while the user gets the benefits.

Tips and Tricks to Find the Best Exchanges

You can read about the team, sort through their insanely technical security jargon and try to make sense of their protocols, but in my opinion, the only way to gauge exchanges credibility is cryptocurrency exchange reviews, its size and reputation. What does the site look like? how long has it been around? How receptive is their local government to cryptocurrency? Just in the last couple of years, the best exchanges have doubled down on everything; security, features, usability. It’s unprecedented that exchanges compete by insuring coins and investing in offline cold storage wallets to keep our private keys safe.

There is more to a good exchange than just security, but it is an important consideration because like we saw with MtGox and Poloniex if an exchange is hacked your coins probably aren’t coming back. 

Our Recommendations For Buying Cryptocurrency

You need an exchange that reflects how you use cryptocurrency. If you are holding all your coins and treating them like an investment your expectations, of an exchange, will differ from the trigger-happy day trader. I will run through some of the most popular exchanges and briefly talk about what makes them different. To learn more about any of these cryptocurrencies exchange sites click the link for detailed cryptocurrency exchange reviews.

Bittrex

Bittrex, for example, is used to trade altcoins and consequently, it’s more of a technical cryptocurrency exchange site. If you want to track your coin’s value with candlesticks and predict or react to the next wave, it’s the place to be. For the everyday Bitcoin user, who just wants to pay their electricity bill this cryptocurrencies exchange is a bit of an overkill.

Bittrex one of the best cryptoexchanges to buy Bitcoins

Bittrex can’t be used to withdraw USD or Fiat currency, and you can’t buy cryptocurrency on the exchange. You need to use an intermediate wallet to send and receive crypto to Bittrex.        The exchange holds hot wallets for all the altcoins on the site. Bittrex is easily one of the best Bitcoin exchange sites.

Coinbase

If you’re using Bitcoin or Ethereum to send money and taking advantage of the technological marvel that is the blockchain, a general-purpose cryptocurrency exchange site like Coinbase is on the money

Coinbase Cryptocurrency Exchange

The exchange can send and receive cryptocurrencies, trade for fiat, and as of October supports instant Bitcoin, Ethereum, and Litecoin purchases from linked bank accounts.

Coinbase is a U.S exchange headed in San Francisco that has grown to offer its services in 32 countries, and they have done so on the back of great functionality and a refined user experience. Offering things like cold wallet offline storage, and an insurance policy that protects their customer’s coins in the seemingly inevitable event of a hacking.

Coinbase also has a powerful cryptocurrency exchange. Its 6 main features that can be implemented into apps of programs, and spend enough time with crypto and you will notice that their Wallet API, Coinbase Connect, Oauth2, Wallet Notifications, Merchant Checkouts, and their open source Bitcoin node pop up all the time.

Etoro

Etoro is a social trading platform that combines the helpful graphs and charts with a feed of user comments and other social features that help you interact with and monitor other traders. Read other trader’s cryptocurrency exchange reviews and follow their movements.

Etoro Cryptocurrency Exchange

Features like the Copy Trading feature let you  mimic the most experienced traders on the network, potentially a source of passive income, and their OpenBook lets you see profits that traders have made this year, and traders earn a percentage of their follower’s profits, or as Etoro puts it “You can earn directly from online trading by leading 5 million social traders worldwide and getting paid as a new generation of fund manager when they copy your investments.” If you are looking for a passive way to trade and learn from others this cryptocurrencies exchange is an effective tool.

Bitfinex

Bitfinex is a Taiwan based exchange with the largest trading volumes in the entire world. An absolute powerhouse the trades on Bitfinex affect the entire market. They handle about 10% of worldwide cryptocurrency and have reimbursed users twice now after their wallet was hacked and millions stolen proving the legitimacy of this exchange.

Bitfinex Cryptocurrency Exchange

What difference does trading on a crypto exchange with a large volume make? The larger the volume the tighter the spread, or the smaller the difference between the buy and the sell price. This might only be a fraction of a cent, but if you are a whale trading thousands of Bitcoins that can make a significant difference. For us small fish it means we can fill orders faster and catch the falls or react to the pumps. Speaking of pumps, this exchange is so massive that it influences the price of other exchanges. Traders are reactors and on Bitfinex you can react faster.

Exchange For Buying Dash

HitBTC

At the time of writing this, HitBTC handles the largest volume of Dash coin trades. Large volumes are especially important for altcoins even ones as popular as Dash. Their fees are on par with other centralised exchanges, charging a 0.1% fee for market trades, and neat security features like two-factor authentication and cold storage keep your coins safe.

HitBTC Cryptocurrency Exchange

HitBTC launched in 2014. Run out of London they are one of the largest exchanges in Europe, with a total market cap that surpassed 100 million USD this year. Like the other three dozen or so cryptocurrency exchanges that have been hacked since 2011, HitBTC was raided in 2016 and a lot of people lost a lot of money. The site also doesn’t have the best rep on Reddit. There are forums complaining about missing money delayed transactions and other issues.

Exchange For Buying Ripple

BitStamp

BitStamp is the only Ripple exchange fully regulated in all 28 EU Member States. Endorsed by Forbes and Reuters, both established businesses and finance hubs, we can trust that BitStamp is a credible exchange for buying Ripple.

Bitstamp Cryptocurrency Exchange

Headed out of Luxembourg, BitStamp popped up in the wake of the hacking and collapse of Mt. Gox. It was the first exchange included in Ripple’s incentive program (Ripple Net Accelerator program) that rewarded financial institutions for exchanging XRP; the program funded by $300 million USD  aimed to build the Ripple network by rewarding financial institutions for volume rebates and adopting the currency into their exchanges. The BitStamp exchange trades USD, EUR, Ripple, Bitcoin, Litecoin and Ethereum.

Best Exchanges For Buying Bitcoins

Kraken

Based in San Francisco but also operating in Japan, the EU, and Canada, Kraken boasts the largest volume of Euro trades. This cryptocurrency exchange site also provides pricing and market information to the Bloomberg Terminal; computer software provided by Bloomberg L.P which allows financial professionals to access and analyze market data.

Kraken Cryptocurrency Exchange

This technical and feature-laden cryptocurrencies exchange, Kraken has quickly established itself as a favourite among traders. For example, Kraken lets users leverage their account holdings against any currency currently trading on their platform. Their sober approach to security sends all deposits straight into a cold wallet and they offer their customers a choice of two-factor authentication and PGP/GPG encryption for email/signature verification. It’s the high fees, I think, that let Kraken down. The transaction fee for Bitcoin withdrawals stands at around almost $7 or 0.0025BTC per transaction. For withdrawal of Tether(USD) the Kraken exchange charges $5USD. Fees vary depending on multiple market variables such transaction volume and the nature of the cryptocurrency itself, whether it be proof of work or proof of stake.

Exchanges & Security

If you want to buy coins and hold until you have amassed some decent profit you need a secure exchange to keep them in. Remember MtGox? In 2014, it was the largest and leading Bitcoin exchange in the world handling over 70% of Bitcoin transactions. Following a hack that lost them 850,000 Bitcoins, an amount valued at more than $450 million at the time, the company filed for bankruptcy. It was later revealed that the coins were stolen out of the MtGox hot wallet and people had been slowly dribbling coins out since 2011.

Bitcoin and cryptocurrency exchange sites have come a long way since then, but I am going to recommend that you don’t keep a large amount of crypto in an exchange. Bittrex, Coinspot, ShapeShift, and the recently hacked Bitfinex, all use hot wallets. They are connected to the internet and no matter how good their security vulnerable to an attack. There are tens of millions of dollars of incentive for people to find backdoors into these exchanges.

They are still good cryptocurrency exchange sites. What you want to do is move your crypto out of the exchange and send it to a more secure wallet.

Cold Wallets & Other Safe Places To Keep Your Coins

You can read all the cryptocurrency exchange reviews you want and find the most reliable exchange out there but if your coins are online they a venerable. To keep your coins safe you should move them into a 3rd party wallet.

A wallet is basically software that holds your public and private keys. Most cryptocurrency exchange sites will have wallets built into your user account, and you can keep your coins on there, but security-conscious traders choose to move their cryptocurrency out of the exchange and into their own wallet.

There are two main types of crypto wallets, hot wallets and cold wallets. The division is a simple but significant one. A hot wallet is connected to the internet while a cold wallet is distanced from the internet or stored on specialised hardware or even a piece of paper.

Decentralised Exchanges – The Future Of Cryptocurrency Exchanges

When you think about it a centralised exchange contradicts the very nature of cryptocurrency.

Projects like the Kyber network give us a glimpse what a decentralized exchange might look like. Users can become a part of the reserve, so to speak, that backs the decentralized exchange with a range of however many coins the reserve operator will supply. The order books are usually stored on the blockchain and matching is executed by smart contracts.

What’s really cool about the Kyber network and projects like it is that they can potentially become profitable. You could make 0.5 or even 0.25% commission of the trades through the spread fees that would otherwise usually be going to the centralised exchanges. Putting funds into a smart contract and earning a sort of interest on that money might be the new investment fund.

Independent Coin Offerings & The Ethereum Exchange Network

Independent coin offerings are how you win at crypto. Back the right coin in its infancy and you can join the new crypto rich. When a clever idea, with a strong team, builds enough fomo it can 100xs in value when it hits the market. A few nice spikes that coincide with a pre-planned roadmap, and you are driving lambos on the moon.

How do you buy into an ICO? Well You need to read the instructions on the ICO’s website to learn how and where they are selling their coins and tokens. You could be sent to any one of a number of exchanges, and you might end up on the Ethereum Exchange network staring down the perplexing Ether Delta

It has a confusing layout and since you are trading with other people you might struggle to buy and sell certain coins, but hidden in the black, red, and green, is some serious money making potential. Funds are held in an escrow contract until everyone gets their coins, and the decentralised nature of the exchange makes it very difficult to hack, plus Ethereum is the future.

Buying Cryptocurrency From Other Traders

LocalBitcoins is an exchange/platform that connects buyers and sellers of Bitcoin. You deal directly with sellers who trade Bitcoins for fiat currency. Because you are dealing directly with other people you can get Bitcoins on the exchange with popular payment methods other exchanges won’t accept and circumnavigate tricky government legislation and verification process.

LocalBitcoin Cryptocurrency Exchange

Local Bitcoin is great for getting coins from PayPal, credit cards, western union, Amazon Gift, steam vouchers, in-game credits, you name it and there is someone on LocalBitcoin willing to sell it. There is a review system and it’s a community based on trust. Risk is offset with fees. Buying Bitcoins with PayPal can be 10%- 40% more expensive than using a regular exchange because of chargeback issues. There are a lot of scammers on the site, but if you are smart about it and only trade with established users it is one of the best Bitcoin exchange sites.

What Is MultiSig?

Multisignature or ‘Multisig” is a form of technology used to increase security within blockchain transactions. It allows blockchain users to divide up authority over coins by requiring multiple users to sign off on a single transaction. Standard transactions over the blockchain usually require only the private key from the owner of the wallet. Using Multi Signature, blockchain wallets need multiple users to sign off on transactions.

This technology is useful when sending large volumes of coins. A business, for example, that wants to use the Bitcoin blockchain to conduct transactions but needs to protect their coins against ill guided individuals and employees. It’s used by the best Bitcoin exchange sites and companies.

Setting up Multisig will stop Tim in accounting from emptying the company wallet, buying some untraceable Monero,  and living comfortably in the Cayman Islands. It also makes it harder for hackers to steal your coins, as they need to get a hold of two private keys, ergo two people need to download that same bit of malware which really takes some doing. 

Transfer Times For Different Exchanges & What Affects Them

The amount of time it takes to send and receive crypto is dependent on the blockchain. Unless the exchange used is running some kind of racket where they buy coins after you put in the order they will send them as soon as your payment method is approved. Depositing time is affected by the infrastructure that connects the exchange and banking services, but once your money has arrived and they have sent your coins into the digital void, the exchange has very little control over the miners, blockchain and how long it will take to process your transaction.

Currently, ripple holds the fastest transaction rate at 4 seconds per transaction. Bitcoin, on the other hand, is notoriously slow, because the blockchain is very congested. A faster way to get Bitcoin is to send Ethereum and then convert it on the exchange once it arrives.

A good resource for finding out how many unconfirmed transactions are pending on the Bitcoin chain is blockchain.info. 

Charts & Graphs For Cryptocurrency Exchanges

Traders use graphs and charts to track the value of their cryptocurrency. The best bitcoin sites will make these tools available, so we can track how our currencies are performing. It isn’t difficult to understand these tools, but you will need to invest some time and effort. Trust me, you will spend many a sleepless night fixated on the bulls and bears and develop an intuitive feel for the ebbs and flows of crypto fomo.

Candlesticks

Example of A Bullish and Bearish Candle Stick

The wicks are the highest and lowest prices in the time period, which is invaluable information for a trader. There are two types of candles, bullish candle – the green ones, and bearish candles – the red ones. Cryptocurrency exchange sites like Bittrex use candlesticks overlaid on top of volume data, and you can also see other information like the daily volume and market cap

 

if you are using an exchange without the graphs, charts, and info you need to make informed decisions as a trader, I recommend Livecoinwatch.com or CryptoCompare.com, both of these are fantastic tools which can give you a small summary and cryptocurrency exchange reviews about new coins and actionable data that will make you a better trader.

CryptoCompare also has a great cryptocurrency exchange API. All of these APIs are free to use under a noncommercial licence. Their cryptocurrency exchange API draws from popular cryptocurrency exchange sites to get info like cryptocurrency pricing, OHLC, and volume data. I just included it on the off chance it is helpful. For more information about the cryptocurrency exchange API navigate here.

Liquidity of Different Crypto Exchanges

Liquidity is a term to describe the speed in which an asset can be traded into different assets and how stable the assets’ price remains whilst trades occur. Compared to fiat currencies, cryptocurrencies are volatile and have low liquidity.

Popularity and volume almost entirely decide how liquid crypto is on an exchange. Hypothetical situation, a coin you were holding is recorrecting, but you bought it high and you’re losing money, so you decide to sell. If no one wants to buy the obscure altcoin, as it plummets towards its floor, you will struggle to sell and have to sell it cheaper to recover.

If an exchange is more liquid, the buying and selling price of your cryptocurrency will be tighter. Smaller difference between the buy and sell price, easier to make a profit on a liquid exchange. The same exchange might have different liquidity for two coins. 

Buy & Sell Walls

When trading, many people like to set up a conditional sale or buy (stop loss). When the price of a coin falls below or exceeds certain values the exchange will fill an order automatically. On more technical exchanges like Bittrex and Bitfinex you can see something called the order book. A visual representation of all these pending trades is called a buy or sell wall. Here is an example of a buy wall. When a coin is decreasing in value and many traders have conditional values set to buy at a particular price and the coin reaches this value a large green buy wall will appear in the visual representation of the order book.

Buy and Sell Wall

Buy and Sell Wall

When the majority of pending transactions in a market are buys (green wall) it usually means an asset is going up in price. When the majority are sells the opposite is true(red wall). Whales or traders with large volumes of the percentage market use these trends to manipulate market direction in order to make a profit. Being able to spot there trends on your cryptocurrencies exchange sites will make you a better trader.

Stop losses

A stop loss order is the name for a conditional order that can be placed and automated for when the market dips below a certain point or rises above a certain point. Many exchanges offer integrated tools that allows traders to create their own stop losses.

For example, a trader setting up a stop loss at 10% or more below the current buying price does so in order to minimise their loss on a crashing market. You must be aware that if their is a temporary fluctuation in market price in which the coin falls below your current stop loss, you will sell out your coin and miss out on the re-correction where it may rise above where you bought into the market. A stop loss set above the current asking price say at 20% above the initial buying price can turn out incredibly well for a trader if the market temporarily fluctuates above this point then back down. If the market keeps growing past this point you will still make a profit however miss out on potential profit for not foreseeing the growth.

Stop losses can be incredibly useful and powerful tools for traders; by understanding their use and risk many potential losses can be avoided and profitable trades automated. Set them up before you sleep.

Popular Exchanges By Region: U.K

Cryptomate

Cryptomate is an exchange exclusive to the U.K. The exchange site boasts direct deposit rates that are processed within  5 – 15 minutes. For U.K traders with online banking and a willingness to go through their authentication process the site is one of the quickest ways to buy Bitcoins and other cryptocurrencies in the U.K. It  was created with ease of use in mind and this makes it easy for investors who are just starting out and wanting to enter the crypto market.

Cryptomate supports, Bitcoin, Litecoin, Ethereum, Dash and more.

Pros

  • Direct deposit processed quickly
  • The exchange has not been hacked
  • Use friendly Interface, suitably for beginning your crypto journey

Cons

  • Relatively high fees compared to competitors
  • Only U.K bank transfers accepted
  • No wallets provided by the exchange

CEX.IO

Cex.IO is a London based company which started out as a mining pool in 2013. The company later transformed into a fully fledged exchange. It is now one of the best Bitcoin sites in the UK, and you can also buy and sell BTC, ETH, Dash and trade ZEC for EUR, USD and GBP. Cex.IO offers direct deposits from bank accounts and requires little to no verification for small deposits, however requires scans of passports, driver’s license, etc for higher deposits.

Pros

  • Open to all countries
  • No commission on deposits and reasonable fees on withdrawals
  • Simple & intuitive interface

Cons

  • Many fiat currencies not supported (only USD, Roubles, Euro and sterling)
  • Help support network is convoluted
  • No exotic altcoins

CoinFloor

Coinfloor allows direct deposits from U.K bank accounts making it a simple way to convert pounds to crypto. The London based Bitcoin exchange opened their virtual doors in 2013 and have grown to become one of the largest exchange in the U.K. Fee wise, their site is quick to tell you that they have a 0% trading fees, but this doesn’t really mean much because you pay an arm and a leg to convert fiat into Bitcoins on the site. There is a  deposit and withdrawal fee to cover Bank charges for processing the transfer and a percentage fee calculated based on your 30 day deposit and withdrawal volume in the relevant currency.

They take both a flat fee and a percentage. So if you make a  deposit of 1,000 GBP, you will be charged 5 GBP flat fee and 3.80 GBP percentage fee (0.38%). It is a confusing fee structure and more information can be found here.

Pros

  • Top tier security
  • Good for high volume trading due to flat fees
  • Direct deposits from U.K bank accounts

Cons

  • High fee for converting fiat into Bitcoins
  • Convoluted fee structure
  • Difficult to contact customer support

Gemini

Gemini is a New York based exchange that became the world’s first licensed Ethereum exchange. They store private keys and the majority of their customer’s crypto in offline cold wallets, which they call  their vaulted storage system, and like other cold wallets this protects wallets on the exchange from the security threats that are synonymous with a hot wallet and an internet connection.

They are regulated by the New York state department of financial services (NYSDFS) and are an excellent choice for the security conscious trader.

Pros

  • Rewards high volume traders with discounts and rebates
  • High level of credibility with regulation and backing from investors
  • Well detailed support page with the option for emailing the company

Cons

  • No privacy due to strict regulation
  • Limited selection of Altcoins
  • Limited deposit methods

Coinmama

Like most exchanges, Coinmama sells coins out of their own personal wallets and reserves. The company is listed in Slovakia, but they sell coins to traders in 217 countries. I have chosen to include them in the U.S cryptocurrency exchange section, because they accept USD payment methods that other exchanges aren’t as willing to process. If you want to buy coins with Western Union or put a couple Bitcoins on the credit card Coinmama will gladly take your money. Just exercise a bit of self control.

Pros

  • Fast and responsive customer service
  • Available in many countries
  • High Deposit allowance with credit/debit cards

Cons

  • Cannot sell Bitcoin through Coinmama, only buy
  • No smartphone app
  • High fees for buying with a credit/debit card

GDAX

GDAX is one of the best Bitcoin exchange sites and U.S based cryptocurrencies exchange. Offering institutions and individuals a place to trade cryptocurrencies like Bitcoin and Ethereum. GDAX transactions are instant to popular U.S exchange Coinbase as the owners of Coinbase founded GDAX to create an exchange for more professional traders to do their thing.

Another noteworthy consideration about GDAX is that it frequently puts up the largest volumes for Litecoin. At the time of writing, GDAX exchange was trading 19.72% of Litecoin ahead of the next most popular Litecoin exchange OKex. If you want to buy and trade Litecoin for fiat or exchange Litecoin to Bitcoin GDAX is the place.

Pros

  • No Major hacks yet
  • Competitive trading fees
  • Accepts bank transfers

Cons

  • Few altcoins available
  • Lack of customer support
  • Owned by coinbase which is known for a lack of customer privacy

Shapeshift

Based in Switzerland, Shapeshift supports the main digital assets such as Bitcoin and ethereum as well as many altcoins. It allows users to exchange altcoins without making users jump through the regular hoops.

Users can initiate two types of orders, a Quick or a Precise order. Quick transactions are the most common. It is a transaction where the user inputs their receiving wallet address, and they are given a deposit address from ShapeShift. You don’t need to tell ShapeShift how many coins you want, they will send you what is owed, at their rate, after you send the coins.

The Precise transaction allows a user to receive an exact amount of coins, obviously you need to send them a precise amount of coins to get them.

Pros

  • High privacy deals
  • Large selection of altcoins
  • Simple transaction process

Cons

  • Unable to trade fiat for crypto, Only crypto
  • Not suitable for beginners, due to the real – time environment
  • No information on current market cap of cryptos on their platform

Changelly

Changelly is an exchange affiliated with the creators of the mining pool, MingerGate. Based in the Czech Republic, Prague, It specialises in crypto to crypto trading. You can deposit any currency and the exchange will convert it to either USD or EUR. There are currently 35 tradeable cryptocurrencies on Changelly including Bitcoin and Ether.

Pros

  • Great way to switch between altcoins
  • No personal information required to use
  • Worldwide support

Cons

  • Higher rates than competitors when buying cryptocurrencies directly
  • Does not allow conversion of cryptocurrency into fiat
  • No leveraging offered
  • Transaction speed lows when the market is busy

Popular Exchanges By Region: Australia

Coinspot

Coinspot are a leading Australian exchange founded in 2013. They offer the largest selection of altcoins in the local market and promote a superior user experience to break down the technical barriers of buying crypto. Prior to Coinspot, Australian traders depended on over-the-counter deposits, and it was their willingness to accept direct deposits and other online payment methods gave them a competitive advantage, or at least, that is what I think.

Pros

  • Great and easy to use interface for beginners
  • Secure with relatively good customer support
  • Widest selection of altcoins in Australia

Cons

  • It takes a while for new coins to make it onto the exchange
  • Difficult
  • verifications process involving a phone call
  • Backlogged customer service

Bitcoin.com.au

This Australian based exchange is well established, however only accepts cash payments. They operate from the heart of Melbourne and are almost two years old. They aim to be the premier Bitcoin service in Australia and are seed funded by Dominet Digital. They provide, mobile, desktop and even cold storage services. A great place for a beginner to enter the Bitcoin market.

Pros

  • Backed by investors (Dominet Digital)
  • No verification required
  • Deposit options at local newsagents (newsstands)

Cons

  • Limited electronic payment support
  • Higher fees than other Australian exchanges
  • Slow transfer times

Popular Exchanges By Region: China

BTCC

BTCC is China’s second largest Bitcoin exchange and the longest running exchange in the world. Bank deposits take 30 minutes and has even released a multicurrency wallet called Mobi with 100+ supported currencies. The BTCC exchange itself only has Bitcoin, Ethereum, Bitcoin Cash and Ethereum Classic markets active.

Pros

  • Funds stored in offline cold wallet
  • Well designed mobile app
  • Affiliation with Bitcoin miners

Cons

  • Higher fees that they only started charging recently
  • Ongoing tensions with Chinese Government
  • Limited altcoins

Lake BTC

LakeBTC is the 4th largest exchange in China and operates globally with trading in more than 40 countries. Users can deposit via almost any fiat currencies. Remember that whichever currency that’s used to deposit will be the currency that must be used to withdraw. Currently the platform only has Bitcoin and Ethereum  trading; once a deposit has been made traders can trade between any of the fiat currencies.

Pros

  • Competitive fees
  • Good security, 2 factor authentication and no major hacks reported yet
  • Accept many different fiat currencies

Cons

  • Clunky website and user interface in comparison with competitors
  • Slow bank withdrawal times
  • Low number of altcoins available

Popular Exchanges By Region: South America

Bitex.la

Bitex.la launched with a 2 million dollar investment and supports many Latin American countries such as Mexico, Brazil, Argentina, Chile, Uruguay and Peru. Deposits can be made with cash or Astropay. Bitex emphasizes user experience criticizing other exchanges for requiring consumers to have a deep understanding of the blockchain in order to take part. The company also announced that all deposits will be kept in cold wallets. With emphasis on ease of use and cold storage, Bitex.la is a secure and user-friendly exchange for South American customers.

Pros

  • Extended Bitcoin API
  • Buy and sell in bulk through designated traders
  • Commercial options to accept Bitcoin payments

Cons

  • Tension with banking institution Banco Santander Río and Banco Gailicia closed the company’s account
  • Smaller exchange would struggle to reimburse users if coins were lost
  • Government tension

SatoshiTango

SatoshiTango is a South American bitcoin exchange which offers services to Brazil, Colombia, Chile, Perú, Uruguay, Argentina, Costa Rica, Ecuador, Honduras, Panama and Nicaragua. It is considered one of the best ways to buy Bitcoins in the countries it supports. It allows users to pay utility bills and takes deposits via bank transfers and cash in Buenos Aires. However this company does not enable trading of other cryptos and remains only a service for Bitcoin Investment.

Pros

  • Bitcoin card service available
  • Allows payments of utility bills
  • Straightforward, user friendly website aimed at making Bitcoin accessible to all
  • High level of media coverage and endorsement

Cons

  • Little to no consumer based reviews
  • Higher fees than other South American Exchanges
  • Newer untested exchange

FAQ

Do the cryptocurrency exchanges operate internationally?

Answer

Must I buy a full coin?

Answer

What is the best deposit method?

Answer

What if the coin is not listed on the exchange?

Answer

Is there a charge even when I make a loss?

Answer

Is it possible to trade from smartphones?

Answer
Cryptocurrency Exchanges
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