Cryptocurrency Exchange: 101
A cryptocurrency exchange is a platform that resembles, in essence, a traditional stock exchange. Instead of stocks, buyers and sellers exchange digital assets. Using crypto exchanges, one can trade fiat money (like dollars or euros) for cryptocurrencies and then use them for one's needs, whether one is profiting from price fluctuations or diversifying traditional assets to lower risks of fund loss.
Besides mere trade, the top-rated crypto exchanges provide users with such features as a wide selection of trading pairs and advanced order types. As well as specialized tools like charting features and real-time market analysis to execute trades effectively in the conditions of the crypto market dynamism. Also, they may allow trading futures or engagement in crypto lending, thereby expanding the potential to grow your cryptocurrency assets.
In a nutshell, cryptocurrency exchanges are versatile and user-friendly tools to start your digital asset trading! Let's learn some more.
American Crypto Exchanges: How They Operate
Designed to be intuitively easy to use, top-rated crypto exchanges in the USA adhere to high standards of security and convenience while offering vast opportunities to maximize your profit.
They offer several advantages, such as the following:
- Possibility for low-spread trading (smaller difference between buying and selling rates), which allows sellers and buyers to evade additional charges.
- Considerable volume of purchase and sale activity, increasing speed and ease of transactions for all users.
- Cost transparency fosters more effective investment planning.
- A plethora of diverse cryptocurrencies provide wide investment opportunities.
- Advanced trading features are available for more experienced users.
US-based crypto exchanges are platforms that ought to function within the legal framework of the United States. This means that any crypto platform for American users should adhere to anti-money laundering and Know-your-customer policies. The platforms naturally verify users' identities, detect suspicious transactions, and ensure crypto exchanges don't become the means for criminals to conceal illegally obtained revenues.
To deposit your money on the platform, you'll need to create an account and complete the verification process. Then, you can top up your account via bank transfers and debit/credit cards. Once the funds are available, you can exchange them for cryptocurrency and start trading currencies for one another or fiat money. Besides, they also provide users with safe storage of their coins and charge transaction fees.
By offering a convenient interface design that helps users easily navigate the platform, reliable customer support services, and educational opportunities, cryptocurrency exchanges present a solution that simultaneously favors the user of the platform and the controlling authorities.
US Cryptocurrency Exchanges Categorized
US cryptocurrency exchanges can be centralized, decentralized, or hybrid. Each of them comes with their own unique features, advantages, and drawbacks.
Here is a detailed assessment of the main types of cryptocurrency exchanges operating in the USA:
Centralized Exchanges
These exchanges owned by companies are basically agents between buyers and sellers of digital assets. Examples of such a trading platform for cryptocurrency may be Coinbase, Binance US, or Kraken.
They store your tokens in your wallet and facilitate trades. Thanks to their accessibility and ease of use, they are more widespread, which increases their liquidity and thereby promotes better prices and quicker trades. These exchanges may include extra features like margin trading or stop-loss orders. Due to good profitability, centralized exchanges usually invest in more advanced security measures like two-factor identification and encryption to prevent hacking.
However, since the exchange holds users' funds, it's impossible to eliminate the risks of hacking or fraud completely. Centralized exchanges also charge higher fees for trades and limited privacy by applying mandatory KYC verification.
Decentralized Exchanges
In contrast to the previous cryptocurrency exchange type, decentralized exchanges do not require a central authority. The decentralized crypto exchange list includes Uniswap, Sushiswap, or PancakeSwap.
Their core is peer-to-peer trading. This means that users can trade directly with each other and have full control of their private keys and funds at all times. Decentralized exchanges generally offer users access to smart contract technology, manifesting in self-executing contracts with their terms directly written into the code.
Such exchanges preserve users' anonymity and, to some extent, protect against hacker attacks. Also, they charge lower fees because they don't need to maintain a large, centralized system. Yet, they may incur such drawbacks as lower trading volumes and liquidity caused by the operational complexity. Also, they may lack advanced trading features that help many users during trading.
Hybrid Exchange
Hybrid crypto coin trading platforms combine the best features of both centralized and decentralized exchanges. They aim to benefit from the security and privacy of decentralized exchanges and the high liquidity of centralized exchanges. However, they are still a new concept, making them less widespread. They are also quite complex and may impose higher fees to offset the cost of maintaining centralized and decentralized elements.
To sum up, all crypto exchange types have their strong and weaker sides, making users choose depending on what they prioritize: security, simplicity of use, extra trading features, or anonymity.
Best Crypto Trading Platform Selection
Seeking the best place to buy crypto? Selecting a suitable crypto trading platform can be challenging, given the variety of options available. Currently, there are about 600 cryptocurrency exchanges around the globe. Of course, you can google the top 10 crypto exchanges in the USA, but do you know what factors to pay attention to in the first place?
Below, we have gathered the most important details you must look for as a potential cryptocurrency exchange user!
| The Top Cryptocurrency Exchanges | ||
| Exchange Name | Fees | Coin Availability |
| Crypto.com | 0.075% fees for makers, 0.075% fees for takers | more than 250 |
| Kraken | 1.5%, 0.9% for stablecoins | more than 200 |
| Coinbase | 0.4% fee for makers, 0.6% fee for takers | more than 200 |
| Binance.US | 0.1% | 100-200 |
| Bittrex | 0.25% | 100-150 |
| Gemini | 0.50% or less | more than 70 |
Crypto Platform Security
The best crypto trading platform must be secure. Thus, selecting a crypto trading platform that offers both account protection measures and overall platform protection measures makes sense. These may encompass two-factor identification—the requirement of two verification forms before allowing access. It is typically your password and a special code sent to your phone. Besides, security measures may involve cold storage solutions for your currency. This is either a hardware device or offline storage, like a computer not connected to the internet. The goal is to store your funds in a place inaccessible to online hacking attempts.
In addition, the best crypto trading platform typically uses encryption methods. This applies to sensitive data like databases with your personal information (from a credit card number to a private key and crypto wallet address). Encrypted information is inaccessible unless the perpetrator has a decryption key.
Cryptocurrencies Supported
Different crypto exchanges propose diverse selections of digital currencies. If you're looking for major coins like Bitcoin or Ethereum, you'll have no problem finding them on any cryptocurrency exchange. However, if your objective is to trade in alternative coins, including specialized tokens or newly emerging ones, it's vital to focus on exchanges with a broader choice. We also recommend estimating how frequently the chosen exchange lists new coins, following major trends. This aspect presents a significant benefit for traders looking beyond standard investment opportunities and aiming to take advantage of shifting market conditions.
Trading Volume
Trading volume (the total number of deals during a specified period) defines market liquidity, which, in turn, affects the user's ability to easily buy and sell assets. High crypto exchange liquidity leads to better prices and indicates that the exchange is a popular and reliable option. The best crypto exchanges in the USA (like Coinbase Pro and Binance US) usually have higher trading volumes. However, consider the liquidity of a particular coin on the selected exchange. For instance, some exchanges might have generally substantial liquidity but offer restricted activity for specific coins you need.
Crypto Trading Fees Variability
Cryptocurrency exchange fees differ greatly depending on the specific platform. To illustrate this point, let's take a look at different methods of charging fees. While some crypto exchanges apply a flat fee per deal, others use a percentage-based fee approach. Additionally, exchanges may impose charges for deposits, withdrawals, currency conversions, account inactivity, and other services, impacting the platform's overall cost. To avoid hidden fees catching you off guard, opt for exchangers with transparent fee formats so that you're able to count all the costs upfront.
Payment Options
Top crypto exchanges in the USA provide users with a multitude of payment options. This is one of the key factors of your crypto exchange choice because there are platforms where users can only trade cryptocurrencies with other cryptocurrencies and are unable to deposit or withdraw funds in fiat currency. If it doesn't suit you, select exchanges that facilitate bank transfers, payments by credit or debit card, PayPal transactions, and other types of web money transfers.
Keep in mind that the speed of deposit and withdrawal processing is also variable from one platform to another. Whereas some payment methods are near-instantaneous, others may take days or weeks.
Exchange Platform Credibility
There are several ways to determine the exchange's credibility. The first one is to pay attention to reviews. Note what other users say about its performance, its security measures, the speed of deals, and the availability of coins. User feedback and experience may indicate the presence or absence of a track record of the platform providing reliable services. Besides, make sure the exchange has responsive customer support. This is an indication of the platform's devotion to protecting the interests of its users. Also, reputable exchanges demonstrate a high level of compliance with regulatory standards existing in the field. This serves as a sign of determination in safeguarding users' funds and personal data.
Best Crypto Exchanges Takeaway
In the rapidly expanding world of cryptocurrency trading, plenty of individuals, whether novices or experienced traders, find it alluring to trade without borders and capitalize on the opportunities presented by easy and fast transactions. While traders from the US may find it daunting to select the best crypto trading platform from numerous options, it's vital to assess the most impactful of the chosen platform features.
Also, take a look at the best crypto exchange platforms for beginners below.
| The Top Cryptocurrency Exchanges for Beginners | ||
| Exchange Name | Fees | Coin Availability |
| Coinbase | 0.4% fee for makers, 0.6% fee for takers | more than 200 |
| Binance.US | 0.1% | 100-200 |
| Kraken | 1.5%, 0.9% for stablecoins | more than 200 |
| Gemini | 0.50% or less | more than 70 |
| Bittrex | 0.25% | 100-150 |
| eToro | 0.75% spread for Bitcoin, 1.25% spread for Ethereum | 15-20 |
The top-rated crypto exchanges boast such characteristics as high security, abundance of currencies, large trade turnover, clear fees, diverse methods of topping your account and withdrawing funds, and a strong reputation among crypto users.