Crypto trading has become the new way of generating passive income. There are many cryptocurrencies to trade on, and several new ones are created and added to the list every month. And investors are going gaga for including these digital currencies in their portfolios.
Crypto is a highly volatile market that can potentially give huge returns quickly. If you, too, are tempted to start crypto trading, the first thing you need to do is find a suitable trading platform. If you end up choosing the wrong platform, it can lead to a considerable amount of wastage in terms of both time and money. Hence, here we are with some tips and factors to consider when choosing a cryptocurrency platform.
Go For Exchanges
The first thing is to go for exchanges. You will find different platforms providing multiple trading options. For instance, there are binary platforms where you can trade long-term and opt for binary options in crypto assets. While there are some legit binary platforms, most of them are scams.
If you choose such brokers, you can become a victim of binary scams. Even though there are binary scams recovery experts, it can still be a lot of hassle to get your money back. Crypto exchanges are specifically dedicated to digital currency trading. Hence, the chances of scams are less.
Choose Security Over Fees
The fee is a critical factor if you plan to do daily trading. Some exchanges provide discounted prices on purchasing and selling currencies. Some others allow you to buy for free and charge only while selling the trade. For instance, Binance charges 0.05% to 0.075%.
While the fee is a vital factor, choose security over it. If an exchange takes more time to complete KYC, do not get frustrated. The more time and hard the procedure, the better it is for security. You also need to conduct ample research on a platform to choose a legit, secure, and regulated crypto platform.
It will also help if your selected exchange uses multi-factor authentication (MFA) security measures. MFA means that before starting or closing a trade, you will have two validate your identity through multiple methods, such as password, OTP, login device, biometrics, security question, etc.
Do You Get Enough Options?
There are thousands of digital currencies, but not every exchange lists all of them. Most exchanges list only the major currencies like Bitcoin, Ethereum, Ripple, or Tether. But several smaller altcoins have the potential to give better returns.
When you have more options at your disposal, you have chances to create a balanced portfolio. Hence, you have to do your homework and find out the list of cryptocurrencies listed on a platform. Currently, Coinbase is one of the biggest platforms, with over 9,000 digital currency assets listed.
The Ease of Usability
The price of a coin can change within seconds. Hence, focusing on user interface and navigation is essential when selecting a crypto exchange. The platform should allow you to purchase and sell coins in a few clicks. Suppose you have 10 BTC in your portfolio, and suddenly the price increases by $100, and you plan to sell it. If the navigation on the platform is difficult and it takes around a minute to purchase or sell coins, the price of Bitcoin can come down to where it was. Hence, you need a platform that is easy to use and navigate.
Best Crypto Exchanges in 2022
Here we are listing the top crypto exchanges based on daily trading volume. However, each exchange has a set of pros and cons, and what you choose should depend on your specific requirements.
Binance is the best platform for affordable fees. The fees here start at as low as 0.075% and keep getting lower as you start investing more. And it can go as low as 0.015%. Binance is also the most prominent platform with the highest trading volume.
With one of the highest numbers in daily trading volumes, Coinbase is an easy-to-navigate exchange. The ease of navigation provides a great experience to beginners and seasoned players. You can also get all the information you need from the vast range of educational material available on the platform. Coinbase also offers robust security measures, including:
- MFA security on all the devices and versions of the platform
- Stores over 95% of customers’ cryptos offline for security reasons
- Provides insurance policy of up to $250,000
Kraken is another popular and reliable crypto exchange with low fees, robust security, and various currency options. It uses security practices, such as MFA, cold crypto storage, SSL encryption, and API key-based permission control.
Choosing a suitable exchange can impact your daily trading due to features like security, fees, user support, easy usability, etc. You can follow the above guide to pick the one that suits your needs.