If you have just stepped into the world of cryptocurrencies and blockchain, there are great chances that you can earn significant returns on your investments. Though there are multiple methods to make payments to purchase cryptocurrencies like debit/credit cards and more, most people use bank transfers to buy crypto tokens. Users can easily purchase and withdraw the crypto tokens to exchange fiat currencies like US dollars or Euro. In addition, there are many websites through which you purchase and trade bitcoin and other cryptocurrencies. The most important thing is to consider the market capitalization of all the cryptocurrencies instead of considering their unit price. Make sure to check official bitcoin up website if you are a trader.
Certain websites are crypto exchanges that are online exchange platforms that allow investors to invest in various crypto coins. Here we will discuss the essential features that are important to consider while choosing the crypto exchange that includes:
- Volume and liquidity
- Geographical locations
- Transaction fees
- Ease of use and user interface
- Anonymity, security, and support
It is crucial to understand all the factors mentioned above, as this will help you choose the proper crypto exchange. These exchanges are marketplaces that are best for buying and trading cryptocurrencies and storage purposes. Once you understand the best cryptocurrencies, you should invest in them, and you must choose the proper hardware or online wallet to store your crypto investments.
3 Main Factors That Are Important To Consider While Choosing Crypto Exchange
Let’s understand about factors that are important to look into:
The main thing that crypto exchanges need to look into is the geographical locations. There are many restrictions regarding crypto exchanges as these exchanges don’t operate in all areas. Before signing up for the crypto exchange, you need to check whether it is accessible in your area or country or not. Both blockchain and crypto assets require following all the policies that local or state governments set. The availability of crypto exchange depends on main factors: whether the crypto exchange has secured certifications and proper licensing and the laws and regulations in the country on cryptocurrencies and blockchain.
As the crypto market is relatively new and highly volatile, there are certain things that you should know about the crypto market. Therefore, it is essential to educate yourself from different sources. Read about cryptocurrencies and handling cryptocurrencies here.
Volume and liquidity
We can understand the liquidity of the cryptocurrency by knowing about the trading volume that it offers. It is essential to look at the liquidity of crypto exchange as it provides the ability to buy and sell cryptocurrencies. For instance, if you wish to trade a pair of cryptocurrencies like Bitcoin or Ethereum, you must sign up at the best-centralized crypto exchange. Centralized exchanges are liquid and fast, allowing buyers or investors to place their orders and choose the proper method to store cryptocurrencies.
If you wish to buy and trade less popular coins, choosing a decentralized exchange or a small exchange is better. Not all crypto exchanges can afford the big exchanges and also charge high fees. The liquidity and large Volume of crypto exchange go together. They are related to the support and reputation of the exchange.
Anonymity, security, and support
While choosing the crypto exchanges, you must check the most crucial things: support, security, and Anonymity. First, check the hacks and losses that have already occurred in the crypto exchange in the past.
Next, check the history of the exchange and make sure to learn about the support that exchange offers. Decentralized exchanges offer high security, good support, and Anonymity to all their users. The exchanges that don’t get controlled by authorities often allow users to sign up using personal information and help users generate recovery seed.
You can ensure the security of the crypto exchange that it offers by checking the two-factor authentication, captchas, and anonymous sign-ups. Make sure to check to know the verification process that crypto exchanges follow. Make sure to check whether they follow the norms of Know Your Customer and Anti-Money Laundering or not.