Cryptocurrency Exchange Basics and what it’s all about
Since 2009, cryptocurrency has been one of the driving forces in the whole world. Like the universally recognized currencies, this new virtual form of digital money has reduced the world to a small village since transactions can be done from any end.
The main concern about the dependability of cryptocurrency is its high volatility. Volatile in the sense that, it can rise to high values and drop very low in a short span. One of such currencies, the Bitcoin hit a high of over $19,000 in 2017, before nose-diving to lows of $8000 in less than one year. But the greater issue cryptocurrency trading is the Cryptocurrency Exchange.
So what is Cryptocurrency Exchange and what does it involve?
By definition, Cryptocurrency Exchange commonly referred to as Digital Currency Exchange( DCE) is a service offered in an online platform specifically to allow crypto holders trade in cryptocurrencies such as Bitcoin for other cryptocurrencies and money under government control, otherwise known as fiat money.
Cryptocurrency Exchange acts as the link between the traditional methods of trade and the digital ones. You may compare crypto trading to the Securities Exchange market that deals with selling and buying of shares and determining the price of the country‘s currency against other currencies as it operates under the same concept. But with a vital difference in that the crypto trading system is decentralized meaning, it’s not controlled by any central bank or government and is mandated to offer options for accepting and carrying payments on cryptocurrency wallet owned by individuals.
What determines DCE’s strength?
Digital Currency Exchange strength is determined by several factors including; the strength of the website server. If the website server cannot detect possible attempted hacking on it, trading in such a market is of high risk. There have been previous incidents where a number of crypto traders lost their cryptocurrencies due to website server being hacked hence a more secure and reliable server is the ultimate determinant in crypto trading.
Another factor; the number of transactions; a high number of transaction minimizes the risk of losing one’s cryptocurrencies. Also, if the exchange fees are relatively high, look for an alternative which fits your budget.
In choosing a DCE; consider one which is friendly to newbie’s, offers numerous payment options and has a highly reliable and responsive customer service.
Some highly valued DCEs available are;
Coinbase; It is user-friendly to new users and charges less than 1.5% for purchases made through the bank and slightly below 4% on purchases made through debit and credit cards.
Coinmama is also friendly to new users, with instant delivery. They deal with different cryptocurrencies such as Litecoin, Etherum, Bitcoin, and BCash making them very reliable to users interested in trading other cryptocurrencies.
uExchange.net though new, offers a decentralized form of trading, with low rates and high reliability. New traders are taken care of on this platform as they find their feet. It trades on various cryptocurrencies and has a reliable customer support system.They also offer very low fees for trading.
Other DCEs include Bitpanda, CEX.IO, Kraken, LocalBitcoins, Bitstamp, Gemini, Binance, Kucoin, Changelly, Bittrex, and Cryptopia.
As noted above, DCEs are numerous therefore it is important for a potential trader to select wisely as the type of DCE you choose can either make or break your crypto trading experience. So before selection do your research and equip yourself with the right information.