The Complete Guide to Selecting Crypto Exchanges: Everything to Know

Sep 30, 2022

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If you have already invested in stocks, and real estate, and are now searching for another viable option to put your money into, then why not cryptocurrency? Not only is it going mainstream because of the emergence of various stablecoins, but it’s also becoming a route to gaining millions.

The first step in trading with cryptocurrencies has to be selecting crypto exchanges that work for your goals and that follow certain criteria. Unsure of how to pick an exchange? Keep reading as we share all the different tips you need to follow to pick the crypto exchange that works best for you.  

Check Their Security Measures

Once you check government regulations on cryptocurrency in your country, then you can start looking at the various security measures exchanges take to protect their client’s investments and coins. Each crypto exchange will share this information on its website or the app directly. They want to assure clients that their coins are safe from hackers and other menacing forces.

Of course, you will want to make sure that you follow strict guidelines yourself when setting up your account, making sure to use 2-factor authentication with SMS or Google Authenticator.

Also, consider if you wish to use a decentralized or centralized exchange.

A decentralized exchange offers more security measures than the centralized one, and they also don’t ask you for your personal information to get you started on your investments. They don’t have those middlemen for guiding transactions either. This means, fewer people are involved in your transactions making them more secure. 

Most crypto exchanges that have been around for a while know how important security is. They will constantly be updating their security measures, informing their clients of when they do so. This should help you feel better about using this exchange since they are constantly trying to stay two steps ahead of the hackers.

What Is Their Trade Volume Like?

Another thing to check out when choosing a crypto exchange is its trade volume. The largest crypto exchanges will have the highest trade volumes. 

This shows you that a lot of other folks like you trust the crypto exchange and have been able to purchase the crypto they want. They have also been able to get the transactions they desire.

You could also check out customer reviews from other crypto exchange users like you. Look at the top ten crypto exchange lists to see which one always shows up on top. 

The more positive reviews that crypto exchange has, the more likely it is that you will have a positive experience with it as well. 

Also, when a crypto exchange has a large trade volume, it can give you a better rate on your transactions. You can get better prices when buying crypto, which is ideal. With smaller exchanges, as they have a smaller trade volume, the prices of crypto are hiked up. 

The price of crypto is constantly going up and down and if you are day trading crypto, then you will want the best price on it as much as possible. Even a small percentage difference up and down can make a huge difference in your profit margins. 

How Many Cryptocurrencies Do They Offer?

Due to government regulations, certain crypto exchanges based in various countries have restrictions on how many cryptocurrencies they can offer on their platform. This isn’t ideal for an investor like you, who would want a wide range of crypto to choose from. 

That’s why you will want to do some research on this to ensure your chosen crypto exchange offers all the different cryptos you would potentially want to purchase. There are more than 20,000 cryptocurrencies on the market now. But that doesn’t mean you would want to invest in all of them. 

The most important thing here is to find cryptocurrencies that work with your long-term investing strategy and make sure that these are available to trade on your chosen exchange. Always do your due diligence when picking cryptocurrencies and before investing in them.

The experts might have a lot to say on each cryptocurrency out there, but you will need to do your research to assure yourself that it’s a good investment for you. The crypto market is still quite volatile, so it’s important not to get complacent about it. 

How Easy Is It to Get In and Out of Positions and Cash Out?

There are lots of crypto exchanges out there that have had negative client feedback rain down upon them. Why?

It’s because users were having a hard time getting in and out of positions, and particularly cashing out from their positions. This isn’t ideal because the whole point of using an exchange is to be able to move your money from cash to crypto and back again with ease and without delays. 

Check out online customer reviews to ensure that your chosen crypto exchange doesn’t have this difficulty inlaid within it. What do previous users say about the platform?

It might seem like a lot of work to do this amount of research before choosing your crypto exchange, but it’s better than getting stuck using a platform that won’t allow you to cash out your positions. Or one that has a week or two-week delay to do so. 

Insurance and Fees

Some crypto exchanges will also provide you with insurance on your transactions. This protects you in case of hacking, theft, cybercrime, phishing, and other kinds of fraud. Crypto exchanges offer this to give crypto users that additional peace of mind when transacting with them. 

But if they don’t offer this insurance, you can purchase it on your own from insurance companies. These insurance policies are becoming more popular nowadays because crypto buyers want protection from cybercrime and losses due to fraud. This doesn’t mean though that you start making all sorts of volatile transactions without any strategy or forethought behind it. 

The other thing to watch out for when choosing a crypto exchange is fees. Each exchange will have its roster of fees that it comes with. These fees would be to place transactions, transfer crypto coins to another exchange, cash out, and more. 

You don’t want to pay too much in fees because that will eat away at your profits. Also, some crypto exchanges charge a fixed fee, while others will charge you a fluctuating fee based on market volatility. Do your research on this to choose the exchange with the lowest potential fee while still getting all the features you want. 

How Intuitive Is the Platform to Use?

You might have had this experience previously. You download a new app or an application, and you sit there befuddled for a few minutes while you try to figure out how to use it.

Since cryptocurrency is such a complicated market, you will want to ensure that you don’t encounter this problem when working with your crypto exchange. The more intuitive and user-friendly the platform is, the easier it will be for you to do all the necessary transactions. 

A lot of crypto exchanges will have instructional videos and other training that will help you not only with placing transactions but also learning more about crypto in general. If you want to improve your knowledge base on crypto, then make sure to watch these videos first before placing any transactions. You can learn more about Bitcoin ATMs here as well.

Potential to Earn Interest and Other Ways to Make Money

Nowadays, buying and selling crypto isn’t the only way to make money on your chosen platform. Many crypto exchanges also offer other ways for you to make money. 

You could potentially earn interest on any crypto you leave in your account over time, just like you would on cash in a savings account. Or you could lend crypto and get returns on that. 

Many crypto exchanges have come up with creative ways to allow their users to make money from their crypto without any trading involved. If you are a buy-and-hold kind of crypto investor, then these alternative earning methods are a great way for you to earn more cash on your investments. 

Selecting Crypto Exchanges Takes a Bit of Concerted Effort

If you follow the tips laid out in the article above step-by-step, you will soon have chosen the best crypto exchange for your crypto trading strategy. It might take a bit of time, but once you have an exchange, you can start making money from cryptocurrencies soon enough.

There are so many folks making hundreds or even thousands of dollars from cryptocurrency every week, so why not you as well? But first, you need to get the selecting crypto exchanges part over and done with.

Did you find this article actionable? We hope so. There are many more interesting articles on our website so please keep browsing. 

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