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How to choose the best cryptocurrency exchange?

What to look out for when trying to choose the best possible crypto exchange?
Choosing the best possible cryptocurrency exchange is extremely important in order to simplify your life later on. But what should you consider when choosing a cryptocurrency exchange? What should you pay attention to?

Choosing cryptocurrency exchange

When deciding on which crypto exchange to use, it depends on your personal preference and what you are really looking for.

When choosing the exchange, you'll want to pay attention to the following criteria:

  1. Is the platform trustworthy? You do not want to put money into some random crypto trading platform that might just take your money and run. So be sure to do your research. Bigger and more known exchanges are better in this case. Our choice in this category is Binance exchange.
  2. Are traders from your country accepted? Cryptocurrencies and crypto trading are slowly being legislated in countries around the world. So you might not be able to sign up in every single popular cryptocurrency exchange you'd want to.
  3. What are the payment options? Can you deposit and withdraw using fiat or only cryptocurrencies? Can you buy crypto instantly with fiat?
  4. What's the minimum investment allowed? What's the minimum fiat deposit you can make? If you have low budget, choose the exchange that supports it.
  5. How high are the fees? Crypto exchanges have different fees for different things. And when in some platform one trade might cost you 1% of the trade value, another exchange might offer the same for 1/10th of that. The more trades you plan to make, the more important it is to find a crypto exchange with as low trading fees as possible.
  6. What cryptos does the exchange support? What cryptos can you trade in that exchange? While most popular and trustworthy exchanges offer you loads of different trading pairs, they also differ from each other. When it comes to good coin selection, our preferred platform is exchange. Lately we have also found that Kucoin coin selection is pretty good. Kraken on the other hand has only a small selection of coins, but they are better in other categories.
  7. How often are new cryptos added to the exchange? When it comes to new crypto coins, there's actually two things to consider. Firstly, you do want to see new cryptos added often enough. But at the same time you want to exchange also to do their due diligence, so that you could be at least somewhat sure that the new crypto isn't a scam.
  8. What kind of leverage does the crypto platform offer for trading? Leverage gives you he option to trade with, and earn from, more money than you actually have. Some crypto trading platforms and crypto trading exchanges might offer you up to 5x leverage, some 20x, some even 50x or higher.

    And when it comes to trading cryptos, leverage is a good thing to have. It gives you the chance to earn more than you actually have. For example, if you have $1000 to trade with and the platform offers you a leverage of 20x, it means that you can buy cryptos for not $1000, but for $20 000.

    Obviously, leverage has its own risks. As while it helps you earn more, it also makes it easier to lose more.
  9. Does the crypto exchange allow hedging? In most simple terms, hedging helps you reduce risks by allowing you to make two opposite trades.

    If you think that Bitcoin price will go up, you buy Bitcoin. But just in case, you short sell Bitcoin as well, should the trade not go your way.
  10. Does the exchange have reliable customer support? Hopefully you'll never need to contact them, but it's always good to know that if you need them, they are there for you.
  11. Liquidity. If you want to make a trade right now for the price you're seeing in the charts, can you actually make the trade instantly? Crypto market is a very volatile market, so you want everything to happen fast.

When choosing the best exchange for you, you should consider all of these aspects, and then some.

Siim Einfeldt photo
Author: Siim Einfeldt
I became interested in cryptocurrencies only a bit more than two years ago. Since then I have been in investing in cryptos using different exchanges. And I also launched when I started trading, just to share my crypto journey and my results.