Cryptocurrency has become more accessible lately, thanks to convenient online exchanges. Users can buy crypto with credit or debit cards via online banking tools. However, finding the right exchange takes time and effort. It’s critical to find and use a legal platform in your country. Moreover, it must be safe and provides users with a wide range of digital currencies.
Check out the following key factors when choosing an exchange. Hopefully, if you’re aware of these, you can choose the best crypto exchange for your needs.
Legislation And Jurisdiction
The most critical part of choosing the best crypto exchanges is to see if the chosen platform works in your state, country, or region. Cryptocurrency is a digital asset that is regulated differently across the world. While one platform works in your region, the other may be illegal.
There are several restrictions and regulations, depending on various factors. Thus, if your chosen platform isn’t legal or is restricted, you will not be allowed to utilize the exchange in question, even if you use a VPN.
Several exchanges also offer country-specific website addresses. Users in the United States often visit websites that, instead of “.com” at the end of the link, have “.us,” which shows that the site is specifically for users from the States. For instance, Binance.US is a platform for U.S. citizens, while Binance.com is a global website available in Europe.
The jurisdiction of exchange represents not just their target market but also where they are permitted to operate under cryptocurrency rules and regulations.
KYC And AML Procedures
A quality crypto exchange ensures the safety of its users by requesting them to go through one of the processes: KYC (know your customer) or AML (anti-money laundering). These two procedures also ensure the reputation of the biggest crypto exchanges, as it’s critical for them not to be the tool of criminals who engage in money laundering.
Typically, best crypto exchanges ask users to pass the KYC procedure that requires them to send a scan of their identification documents. Exchanges don’t share this data with anyone but require it to verify user accounts. If the exchange doesn’t have such a procedure, it may be a good idea to avoid using it.
If you want to exchange crypto, you should have several payment methods at your disposal. The manner of obtaining digital currency differs depending on the platform. Some exchanges need bank transfers for deposits, while others allow PayPal, credit and debit cards, etc. In contrast, other networks enable purchases only via cryptocurrency.
If you do not have any cryptocurrencies before creating an account on an exchange, you must find a platform that takes fiat currency to access the market. It is also vital to consider how long it takes to make a transaction. Some systems execute transactions within, while others take days or even weeks.
It’s clear that the most popular exchanges are relatively safe, and they have good reputations. But what if they don’t work in your country? Or what if they don’t have the currency you want to purchase? In that case, you should choose a reputable platform.
How to find a trustworthy exchange? It is critical to research various exchanges by searching them on Google with the phrase “scam.” Read reviews and feedback from users carefully to learn about common issues within the platform. If reviews state outright that the exchange is a scam, then it’s best not to use it.
Check out safety measures on the official website of the exchange. It should at least offer a two-factor authentication (2FA) procedure. For instance, WhiteBIT, the biggest European exchange, uses Web Application Firewall (WAF) to protect users from hacker attacks. Moreover, WhiteBIT stores 96% of digital assets on cold wallets to protect user funds.
Traders want liquidity so that they may execute deals at any moment. Thus, an exchange must provide its users with sufficient orders flowing through its order books. An exchange must have many users or account owners with significant assets on the exchange and trade them regularly. If only a few orders are available, there may not be any trading partners.
Fees differ across platforms, so it’s critical to understand how much you pay for exchange services. Some platforms are transparent about their fees; others offer hidden fees. Be sure you understand the fees associated with any cryptocurrency exchange before you create an account.
One of the most critical aspects when choosing an exchange is ensuring that it works according to the regulations and rules enforced in your country. The exchange must be safe and provide enough cryptocurrencies to buy digital assets anytime you want.