The Best Bitcoin and Cryptocurrency Exchange Guide
Understanding cryptocurrencies alone can be daunting, and if you’re new to crypto trading, finding the right platform to buy and sell popular assets like Bitcoin, Ethereum, and Litecoin can be another challenge. The foremost concern when trading and purchasing Bitcoin, or other cryptocurrencies, is safety and security. Whether you intend to purchase and hold long term, want to trade frequently, are interested in anonymity or privacy, or simply want ease of use, the following exchanges are the best for any use case you may have.
The main things to look for when choosing an exchange are:
- What type of exchange is this? (Broker, trading platform, etc.)
- Does this exchange support the coins I want to trade?
- Does this exchange accept users from my country?
- Does this exchange accept my payment method?
- What are the fees and buying limits for the exchange?
If you want a more detailed explanation about cryptocurrency exchanges and detailed reviews keep reading this post. Here’s what I’ll cover:
- How to Convert Cryptocurrency to Real Money/Cash?
- Types of exchanges
- What are the Best Bitcoin and Crypto Exchanges?
- Exchange Features
- Exchange review summary
1. How to Convert Cryptocurrency to Real Money/Cash?
Sell bitcoin on a cryptocurrency exchange, such as Coinbase or Kraken. This is the easiest method if you want to sell bitcoin and withdraw the resulting cash directly to a bank account. To make sure brokers do not break money laundering laws, you will need to withdraw to the same bank account that you deposited with. It’s simple, easy, and secure, but it’s not the fastest method.
But not all exchanges are equal…
2. Exchange types
It’s important to understand that not all cryptocurrency exchanges are alike. Some allow you to trade with other users, while other exchanges will only sell you Cryptocurrency directly. Some will not even give you the actual coins but will only allow you to speculate on the price.
Let’s break down the different types of exchanges.
These are the exchanges that allow you to buy a cryptocurrency directly using your fiat currency (a government based currency such as the US dollar or the British Pound). These are most popular with those who aren’t familiar with the crypto market because it allows for easy access to the cryptocurrency of their choice without much hassle.
Examples of known brokers: Bitpanda, Coinbase
Trading platforms are sites that connect buyers with sellers anonymously in an automated form. This means that you buy from people who’ve placed sell orders on the site without ever communicating with them directly. The platform usually takes a small fee for the service.
Conducting transactions on trading platforms is usually the cheapest way to get bitcoins or other coins, but often it’s not very user friendly. Trading platforms have advanced options such as limit orders and stop losses that can confuse inexperienced users.
Also, when you place an order, it may not be fulfilled immediately due to a lack of sellers at the price at which you want to buy.
Examples of known trading platforms: Binance, Kraken
P2P crypto exchanges allow users to buy or sell directly with another user. Unlike centralized exchanges where you have to complete KYC to process an order, most P2P exchanges allow you to send/receive cryptocurrencies without asking you for identity verification. Also, exchanges based on the P2P model have no single point of failure like centralized exchanges do.
Examples of P2P platforms: LocalBitcoins, Paxful.
3. What are the Best Bitcoin and Crypto Exchanges?
What Are the Best Bitcoin and Crypto Brokers?
As we’ve explained in our CEX review, this site has been since 2013. Initially formed as a holding entity for GHash.io, this a UK-based exchange is now a place for those that enjoy margin trading (i.e. the difference in value between two currencies over a set period of time). When you join this site, you can speculate on a variety of currency pairs, including BTC/EUR, BTC/USD etc.
For us, the main reason CEX is one of the stand out Broker in the UK is its interface. Unlike many of the leading platforms, CEX is set-up for beginners. This means you can register with CEX, login, scroll through the list of options and make payments within minutes, regardless of how experienced you are.
Coinbase is the world’s largest Bitcoin broker around. It is available to users in over 100 countries especially in the United States, the United Kingdom, and Brazil, which represent their largest customer base – and has more than 30 million customers around the world. It was founded in 2012 as part of Ycombinator, which means that Coinbase is also one of the oldest crypto trading platforms around.
Customers can purchase and sell Bitcoin with a connected bank account, SEPA transfer, Paypal account (selling only), Interac Online, and many more payment methods. This cryptocurrency exchange has started out only as a broker (selling Bitcoins directly to customers). However, in May 2016 Coinbase started operating GDAX – which is now called Coinbase Pro. This is a Bitcoin exchange, where Bitcoiners can trade Bitcoins with one another.
Coinbase currently allows its customers to purchase and sell, among many others, three of the most popular cryptocurrencies – Bitcoin, Litecoin, and Ethereum. Since end 2018 and during 2019, they added support for a lot of other coins, mostly ERC-20 tokens like BAT, 0x, ZIL and etc.
Bitpanda is a trustworthy exchange based within the EU, which lets users buy, sell, and trade cryptocurrencies using fiat currencies and digital tokens. Originally established back in 2014, under the name of Coinimal GmbH, it was later rebranded to Bitpanda. Today, it remains based in Vienna, Austria and has become the chief cryptocurrency broker in the EU for buying or selling top cryptocurrencies like BTC, LTC, ETH.
To provide better security for users’ digital assets, Bitpanda stores them in offline cold storage devices which are not connected to the Internet. It also offers two-factor authentication (2FA) to protect users’ accounts from unauthorized access. In fact, should you need to update your email address, phone number or 2FA, the Bitpanda team might contact you personally by phone to verify said changes. Other security measures in place include DDOS protection and SSL encryption.
What Are the Best cryptocurrency Trading Platforms?
Binance is a cryptocurrency exchange that was founded in July 2017 after a successful ICO that raised 15 million. The exchange has attracted millions of users in multiple countries across the world and is often applauded in exchange reviews and social media as the best cryptocurrency trading exchange. Users can buy, trade, sell, earn, stake and instantly swap digital assets on a beginner-friendly and easy to use platform.
Binance is well known for having one of the largest selection of cryptocurrencies and trading pairs available to exchange, store electronic funds within a secure wallet and earn interest on crypto in a Binance savings account.
San Francisco-based Kraken is one of the largest Bitcoin exchange in euro volume, liquidity, and the trading of US dollars, Canadian dollars, Japanese yen, and British pounds.
Kraken landed in the international scene on 28th of July, 2011, and was founded by Jesse Powell, who holds a bachelor’s degree in philosophy from California State University, Sacramento. Kraken was the first Bitcoin exchange to have trading price and volume displayed in the Bloomberg Terminal,
The exchange serves users from Europe, Japan, and the entire of North America—with the exception of New York because of the BitLicense. Anyone in the world can easily use its entry level services, such as statistics and price charts.
Kraken is a leading digital currency exchange for “serious and professional traders”, and as of January 2017 the platform was the world’s 2nd largest in terms of volume. The site is designed with the sophisticated trader in mind, and provides access to many sought-after features such as deep liquidity, margin trading and fast execution speed.
The platform offers comprehensive services for the crypto investor, such as the ability to trade digital tokens against fiat currency and buy and sell Bitcoin.
Kraken is also transparent, offering a high level of security and proof of reserve audits.
BitMEX is a peer-to-peer cryptocurrency derivatives trading platform that offers leveraged contracts and is one of the largest and most widely used margin trading platform in the world.
Users are able to buy and sell contracts for cryptocurrencies (not the actual coins themselves) combined with margin trading up to 100 times. This means only Bitcoin deposits and withdrawals are permitted. It is a great platform for cryptocurrency digital traders looking to increase their BTC holdings by trading the market.
One of the best leverage exchanges in the world is BitMEX.
BitMEX features bank-like security measures to ensure the highest standard of safety of customers assets stored on the trading exchange. Multiple protection layers have been implemented such as multi-sig withdrawals and Two Factor Authentication (2FA). This means users need to provide multiple verification measures such as a password and unique mobile device code to successfully log in, confirm withdrawals and change account details.
PrimeXBT is one of the younger generations of cryptocurrency trading platforms which is looking to undercut established competitors by offering added benefits and lower fees. Although relatively new, the platform supports trading in a variety of markets, giving you access to significantly higher leverages and a sleek and intuitive platform.
The platform’s sole trading currency is Bitcoin, and all deposits and withdrawals are in this cryptocurrency. You can invest in a variety of cryptocurrency derivatives (CFDs), as well as Forex, Commodities, and Indices. PrimeXBT does not support fiat currencies, however, it does offer the possibility to trade in currency pairs using Bitcoin.
Accessible worldwide with some exceptions, the PrimeXBT platform is available in a variety of languages. Apart from English, the platform supports Chinese, Korean (SK), Japanese, Portuguese, Russian, Spanish, and Turkish.
The company which operates PrimeXBT is based in the Seychelles and the platform is not regulated. This may be cause for concern to some users, but an increasing number of positive user reviews combined with the platform’s security measures give some peace of mind that the operator is responsible and reliable. Funds stored on PrimeXBT are not insured, however, the platform takes steps to protect user funds from cyber attacks.
What Are the Best Bitcoin and Crypto P2P Platforms?
Paxful allows people to trade in Bitcoin, by connecting buyers and sellers on their platform. They are not an exchange who store crypto-assets but rather simply provide an exchange platform.
The interface is user-friendly and welcoming for beginners. Anyone who wants to buy crypto-assets using digital payments can easily make the purchase. You do not need to spend time going around the website and learning about its functionality.
The most lucrative part of Paxful is that it offers more than 300 payment options for its users. From cash payments to digital payments, users can choose any means to pay for their Bitcoins.
Orders are processed quickly on Paxful. Their payment process is seamless and if you want to make a cash deposit to your Paxful account, you can do that easily too. Later you just need to upload your receipt, after which you will receive your Bitcoins in your wallet.
Paxful is available worldwide without much problems or compliance issues. Paxful is only banned in the state of New York but is available in many countries including the USA, India, Russia, Nigeria etc.
Users have the option to activate 2FA (two-factor authentication) on their devices to add an extra layer of security. You can also verify your mobile numbers and email ID if you want to.
LocalBitcoins is a cryptocurrency exchange with a difference. Based in Helsinki, Finland, the startup provides a platform for peer-to-peer Bitcoin trading. Registered users can use LocalBitcoins to advertise, buy, and sell Bitcoins, without having to use a conventional CEX exchange.
With LocalBitcoins, it is the individual sellers who set the conditions. For this, and several other reasons, the platform is often compared to Amazon or eBay. Sellers state the relevant exchange rates and the payment methods they accept, and buyers need to abide by these. The platform charges a fixed, 1% fee on successful transactions.
When a deal is agreed upon, the buyer and seller can choose to meet in person to trade the Bitcoin. Following the deal, both parties have the opportunity to review the other party, and this helps build credibility amongst users. Furthermore, LocalBitcoins offers an escrow service together with a conflict resolution team. As a result, this exchange counts over 110,000 active users worldwide, with around 2,500 Bitcoins traded daily.
4. Exchange Features
Next, you’ll need to inquire about the different features on each exchange. Here are the most important ones:
- Coins supported
- Countries supported:
- Accepted payment methods
- Exchange rate
- Buying limits
- Exchange reputation
Exchanges today have a Know Your Customer process, also known as KYC, that you’ll have to go through before buying any coin on the exchange.
The know your customer or know your client (KYC) guidelines in financial services require that professionals make an effort to verify the identity, suitability, and risks involved with maintaining a business relationship. The procedures fit within the broader scope of a bank’s Anti-Money Laundering (AML) policy.
KYC processes are also employed by companies of all sizes for the purpose of ensuring their proposed customers, agents, consultants, or distributors are anti-bribery compliant, and are actually who they claim to be.
Banks, insurers, export creditors, and other financial institutions are increasingly demanding that customers provide detailed due diligence information. Initially, these regulations were imposed only on the financial institutions but now the non-financial industry, fintech, virtual assets dealers, and even non-profit organizations are liable to oblige.
You now know the most important aspects to look for when choosing your crypto exchange. In the end, the main thing that matters is that the company (or seller) is reliable and that you’re happy with the price you’re paying. Sometimes it’s worth it to spend a bit more money in order to finish the process hassle-free.