It’s a platform on which one can buy or sell cryptocurrency. The cryptocurrency exchange also allows its user to trade one crypto for another, for example, Bitcoin to Dogecoin. One can also exchange cryptocurrencies back into the U.S. Dollar or any other currency that the exchange allows.
What to look in a Crypto Exchange?
– Security: The very first factor is when someone is about to open an exchange account is security. As we know by now Cryptocurrency is not centralized, meaning your assets are not protected in the same manner as your assets that are kept in the bank. So if you were to get hacked and your funds taken away you would not be able to recover those funds unless you were with a trusted Crypto exchange that would be able to reimburse your funds to you.
– Access: The Second factor is accessibility because that plays a big role in your trading. Your location is a big point e.g., if you live in Singapore you would have to have a licence to operate there and if you operate without a licence, you can be prosecuted. There are other locations such as China where certain crypto exchanges aren’t even accessible due to them being banned.
– Fee: Another factor would be the Fees. Now this is a slippery slope because normally we associate high price with good quality but that isn’t always the case in crypto exchanges, don’t get me wrong some can be worth exactly what you pay for them because they come with that security but some charge high end fees and still scam you off your money.
– Coins: You should also look at the variety of coins that are offered by the crypto exchange as a factor. Because if you just want to buy bitcoin, the popular crypto, you can find that on any exchange but if you are a visionary and want to invest in something that will blow up in the coming future you should definitely then look at exchanges that offer you variety with their altcoins and a wide selection of NFT’s. Not a financial advice but you should know investing in these lower end crypto currencies is extremely risky because you don’t know if the currency is a pump and dump.
– Blog: All the best exchanges have a section that is dedicated to the education, so customers can learn about different kinds of coins, learn about the market, the candle stick charts etc this way the customer knows exactly what they are getting into.
– Wallet: Any good crypto exchange would offer a good and trustworthy wallet to its customer, so if a customer is doing day trading, they can access it easily. A crypto exchange should thrive to give its customers convenience. Some people might still not use the built in wallet the crypto exchange offer because they believe hot wallets are easily hacked and they don’t want to lose their hard earned funds like that so some people refer to hardware wallet something that is very high is security.
– User Friendly: One of the most important factors that every crypto exchange should have is that it should be easy to operate. You don’t want to open the exchange and just feel you have landed in a math problem. This should be prioritized for every beginner. A good crypto exchange would also offer a mobile app, everyone owns a smartphone these days and if the crypto exchange has an app the user can just see the market from their phone and decide to sell or buy all while being in a different country.
In conclusion, there are many factors that make a great crypto exchange e.g., good customer service and all the factors mentioned above. If a crypto exchange can offer the trading of variety of altcoins and NFT’s at an acceptable fee, there is no reason to believe why that crypto exchange won’t succeed. In the beginning, the crypto exchange should advertise across all media platforms and of course once the customer comes and sees their associates to join the exchange as well, in the business world nothing is better than word of mouth.
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