Technology

How To Choose A Good And Reputable Crypto Exchange

How To Choose A Good And Reputable Crypto Exchange

Whether you are completely new to the world of crypto or have been investing for a while, there is always plenty to learn. It starts with the basics; understanding crypto, deciding what to invest in, and figuring out where and when to spend your money. All of these questions are important, as they would be with any kind of investment.

In the world of cryptocurrency, there are so many different ways to buy, hold, spend, or earn interest on currencies. One of the main places to do these is through exchanges. In this article, you’ll find a breakdown of crypto, where you should buy it, and what to look for when choosing a good and reputable cryptocurrency exchange. 

What Is Cryptocurrency?

Firstly, what is cryptocurrency? The basic thing you need to understand is that cryptocurrencies are decentralized digital currencies, meaning there is no one central bank or organization controlling the currency. Instead, it is based on blockchain technology, where every person invested into any given coin can then help authorize and confirm transactions. This places the power with the currency holders, miners, and investors alike – instead of a government or bank holding this power.

Why Invest in Crypto?

This could sound risky to many. In some ways, it still is. Only a few coins have – so far – stood the test of time, with others coming into the sphere only to disappear as fast as they arrived. However, it’s clear to see that crypto is here to stay. Its adoption around the world means it is an ever-growing, almost constantly inflating asset. Soon, it’s likely that more and more retailers in Canada and the rest of the world will start accepting cryptocurrencies as payment. If you had invested $1000 in Bitcoin just 12 months ago, you would have earned approximately $3000 in profits. So, you could argue that it is a high-risk, high-reward investment. 

What Are Crypto Exchanges?

So, on to crypto exchanges. What are they? Well, according to hedgwithcrypto.com, finding an exchange is one of the most important parts of your crypto investing journey. These are effectively trading platforms. They are the go-between for you to easily access, invest in, and hold your cryptocurrencies. Often, they allow purchases directly from your debit card or checking account. 

Effectively, they make investing in crypto easier than ever before. In the past, you would have had to access various cryptocurrencies on different blockchains and trading sites. Now, you can get most of the top 200 currencies online in one place. 

Look at Reviews

The first thing you should do is look at reviews of crypto exchanges. Many people on YouTube and blog sites have openly shared their crypto investment journeys, with detailed information on how, when, why, and where they purchased their coins. Many of them will share extremely detailed reviews of cryptocurrency exchanges, citing reasons for them being good, easy to work with, have great customer support, or, sometimes the opposite! Otherwise, some great review sites conduct honest and fair reviews of all the various exchanges. Just make sure you listen to multiple sources and take different opinions. 

Talk to Investors

If you want some extra help, reach out to some people that you know invest in crypto. This could be friends and family or people online in forums or on social media. These people – assuming they are people you can trust – will again share with you their honest thoughts and feelings about different exchanges. Often, spaces on sites like Reddit are dedicated to crypto news, conversation, and discussion, so you can usually find some honest information there.

Security is Key

Now, whenever you part with your money for investment or anything else online, it’s important to know that your money is safe. In most countries, investment platforms have to be protected by a financial regulatory authority. Crypto exchanges aren’t always this way. Some hold insurance, some hold regulatory status. Whichever exchange you choose to do business with should have at least one of these, otherwise, you are giving your money to someone with no vested interest in protecting it.

Ease of Investing and Withdrawing

As mentioned, one of the early drawbacks in the cryptocurrency sphere was the ease of investment. This is why exchanges have become so popular. They all work in slightly different ways, though. You need to decide what method you’d like to use for investing and find an exchange that works the same way. 

For example, if you want to buy Bitcoin by direct debit every month, find an exchange that will provide that service. If you want to deposit cash and spread your purchases, maybe a different exchange would be better for you. Whatever your investing style, there will almost certainly be a cryptocurrency exchange to match. 

Fees and Limits

Some exchanges charge wildly different amounts to others. For example, some will make you pay a hefty fee for using a debit card, while others may offer fee-free debit deposits. Some may charge nothing for a bank transfer, while others may take 1%. It’s important to check different fees for the style of investing you plan to do. If you’re buying and selling a lot, you need cheap transaction fees. If you are more of a one-time purchase and hold kind of investor, these fees may not worry you as much.

Credit and Interest

Finally, it’s worth noting that some exchanges now offer staking, interest accounts, or lines of credit. This means you can either borrow money against your crypto balance – for example, dollars against BTC – or leave your crypto in a specific account to gain daily interest. These offers are relatively new for exchanges, so many are competing to offer the best deals. If this is something that interests you, look for exchanges that have the most impressive interest or staking deals.

These are the main things to consider when investing in crypto through an exchange. Make sure you are putting your money somewhere you trust and that you’ve done ample research on the company, its history, and its security. Then, pick your investment strategy and start your crypto journey… It could not be easier.

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