So you are looking for a cryptocurrency exchange to start trading? This guide will help you pick out the best one.
WHAT IS A CRYPTOCURRENCY EXCHANGE?
Cryptocurrency exchanges are platforms that allow you to buy, sell or exchange cryptocurrencies for digital currencies or fiat currencies (US Dollars, Euro, JP Yen, etc). Some exchanges require you to verify your ID and open an account in order to have access to specific trading tools for professional traders. If you wish to make a casual and straightforward trade, there are platforms that allow you to trade without an official account.
TYPES OF CRYPTOCURRENCY EXCHANGES
One way of classifying cryptocurrency exchanges is based on the tradable currency:
Fiat exchanges: these platforms allow the exchange of government-backed currencies (US Dollar, Euro, JP Yen, etc) with the currencies you wish to trade.
Crypto-to-crypto exchanges: These exchanges allow you to exchange cryptocurrencies with each other. For example: Bitcoin vs. Ethereum.
Cryptocurrency exchanges can also be classified as:
Trading platforms: These are websites that operate like traditional exchanges, where connect buyers and sellers and charge a fee from each transaction. The role of the exchange is like that of a third-party facilitating the transaction.
Direct Trading: These exchanges facilitate direct person-to-person trading between buyers and sellers. In these platforms, individuals from different countries can exchange currencies with others. Direct trading exchanges don’t have a fixed market price but each seller sets their own exchange rate.
Brokers: Buyers can visit these exchanges to buy cryptocurrencies at a designated price which is usually the current market price plus a small premium. These brokers can be seen as foreign exchange dealers.
Here is another common way to categorize cryptocurrency exchanges:
Decentralized exchanges: In DEXs, all trading transactions occur directly between users in a peer-to-peer (P2P) network without any third-parties. DEXs are technically more secure than any other platforms since the hosting of DEXs distributes throughout the nodes, reducing the risks of server downtime and the possibility of hacking.
Centralized exchanges: In contrast of DEXs, CEXs are centralized models (Coinbase, Binance, Bittrex,etc) where third-party platforms facilitate your transactions.
FACTORS TO CONSIDER BEFORE JOINING AN EXCHANGE
Reputation
Security should be a top priority. Before joining any exchange, make sure to search for reviews from users and reliable industrial websites like dapp.com or dappradar.com. More specifically, you can post your questions on high-traffic forums like Bitcointalk.org, Reddit or Quora to get help from their members.
It’s crucial to do your own research on its history, current status and the people behind the exchange. Any trace of fraud cases and cyber attacks can make the exchange continue to be a potential target for online thieves.
Fees and commissions
Exchanges should inform users about fees and commissions in advance. Fees can be different between each platform. Transaction fees may take a cut into your profits if you’re a high-volume trader. It’s a primary thing to understand about deposit, transaction and withdrawal fees before joining an exchange.
Payment methods
Payment methods varies within exchanges and can be included many options such as Credit or Debit cards, Paypal, cash, wire transfer, etc. It would be an inconvenience if the exchange you use has limited payment options. Keep in mind that buying cryptocurrency via wire transfer will take much longer as you have to wait for banks to process.
Geographic locations
The exchange region may take them more or less likely to offer coins. For instance, Chinese exchanges tends to prioritize Chinese coins on their lists. Some exchanges or some of their specific functions are not available in certain countries or regions. You should consider whether the exchange you want to join allows full access to all functions in the region you currently live in.
Verification Requirements (KYC)
Personal information is confidential and some people don’t feel comfortable to share it. Most trading platforms require some sort of ID verification in order to make deposits and withdrawals, as well as to prevent them from all kinds of scams and money laundering. Some exchanges will allow you to remain anonymous, most likely are decentralized models since they are virtually impossible to be attacked.
THE BEST CRYPTOCURRENCY EXCHANGE
HB DEX is a full-decentralized exchange integrated with HB Wallet application. The platform supports up to 8 languages and is compatible with various platforms such as iOS, Android, MacOS and Windows. Users can access HB DEX and its specific functions without geographical restrictions.
Developed by Bacoor.Co — a multinational technology firm based in Malaysia, HB Wallet is considered the best Ethereum Wallet in Japan in 2019.
Unlike centralized exchanges like Coinbase or Binance, HB DEX requires no personal data. Buyers and sellers can trade their crypto assets directly and comfortably with each other while remaining completely anonymous.
All transactions on HB DEX are executed directly on the Ethereum blockchain based on Smart Contracts. Smart Contracts are computing protocols running on top of a blockchain, with encrypted set of rules between permitted users. Transactions are only confirmed by a network of million computers once certain conditions on the smart contract are met. Smart Contracts secure the flow of funds and render transactions traceable, transparent, and irreversible. The only way for an attacker to succeed is to compromise one of the two parties.
HB DEX covers most comprehensive functionalities that centralized models lack of, offering a seamless trading experience. The trading process is faster, less expensive, and more secure than any web-based exchanges and wallets. HB DEX supports real-time trading with ETH for any cryptocurrencies under the form of ERC-20 tokens and vice versa. Keep in mind that ETH does not follow the ERC20 standard so you cannot directly exchange them for other ERC-20 tokens and backwards. Because of this reason, HB DEX allows users to convert ETH to WETH (an ERC20 token) and WETH to ETH efficiently. Since ETH is tokenized via WETH, the values of ETH and WETH are equivalent.
With HB DEX, you can also list any tokens on ERC-20 or ERC-223 that you prefer, buy ICO, receive airdrops and manage your own tokens directly.
HB Wallet has partnered with Simplex, allowing users to buy cryptocurrencies via Credit or Debit Cards provided by Visa, Master Card, JCB, or American Express. You can purchase not only Ethereum (ETH), but also Bitcoin (BTC) and Ripple (XRP). The purchasing process should take no longer than 10 minutes. All your filled in information will be kept securely and confidentially by Simplex for KYC purposes only. However, your identification still remain anonymous on HB Wallet, so don’t worry.
HB DEX is 100% free, the only fee you have to pay is the Gas Fee of the Ethereum network.
Download HB Wallet: www.hb-wallet.com/download.
