Which Cryptocurrency Exchange Should You Use?

Cryptocurrency such as Bitcoin and XRP present an interesting investment opportunity while offering several advantages over more traditional money systems since there is a limited supply and the Bitcoin value increasing over time. You’ll need to use an exchange if you want to add some to your portfolio though. Picking the right one is essential, as some are Ponzi schemes masquerading as legitimate businesses to take advantage of newcomers to the space.

The list below details six trustworthy exchanges, along with a brief explanation of the pros and cons of each. Notably, this list was put together with an American audience in mind. Many exchanges don’t do business with Americans due to regulatory concerns, but all six of the exchanges below happily accept American customers.

Without further ado, let’s get to the list!

1. CoinBase.com

CoinBase is widely recommended to novices because of its intuitive interface and the option to conveniently fund purchases with a bank account or credit card. Cashing out is also simple, as your money may be deposited directly to your PayPal or banking account. Finally, money deposited on CoinBase is insured, giving you peace of mind that most other exchanges do not.

That said, all of those advantages come with some pretty significant drawbacks. The site charges a 1.49% transaction fee for bank transactions and a whopping 3.99% if you use a credit card, making it one of the most expensive exchanges around. Coinbase currently has 14 cryptocurrencies to be bought and sold including:

1. Bitcoin  BTC
2. Ethereum  ETH
3. XRP  XRP
4. Litecoin  LTC
5. Bitcoin Cash  BCH
6. EOS  EOS
7. Stellar Lumens  XLM
8. Ethereum Classic ETC
9. Zcash  ZEC
10. Basic Attention Token  BAT
11. USD Coin  USDC
12. Augur  REP
13. Ox  ZRX
14. Dai  DAI

Coinbase has other cryptocurrencies displayed, but only showing their prices and not available for trading. 

If you want to try your hand at altcoins without sacrificing CoinBase’s security, the same company also runs another exchange called CoinBase Pro (formerly GDAX) for advanced investors. Tokens may be transferred between CoinBase and CoinBase Pro immediately and without fees, creating an experience comparable to using one exchange.

2. BitStamp

BitStamp, best described as CoinBase for Europeans, offers the advantages of an intuitive interface and a more robust token selection than CoinBase, notably adding Ripple to the latter’s choices. Fees are also very reasonable for European customers. There is no deposit fee if you fund your purchases through a SEPA account, and a flat 0.90 EUR withdrawal fee applies to all withdrawals regardless of amount.

Fees aren’t unreasonable for non-Europeans either, but Europe gets a better deal. You can fund your purchases through a credit card, but the cost for doing so varies from five to eight percent depending on the value of the transaction. That borders on price gauging, so you should probably look elsewhere if you want to use credit.

3. Changelly

Changelly is a different type of exchange in that it allows users to buy one cryptocurrency using another instantaneously. First, you tell it what coin you have, how much of it you want to spend, and what currency you’re interested in obtaining. Once armed with this information, the Changelly bot automatically searches other exchanges to get you the best possible conversion rate for your transaction. It provides an estimate of how much of your desired coin you’ll get, and can then execute the transaction with your approval.

The process takes five to 30 minutes, meaning that you could end up with more or less of your desired token than quoted if the price changed between the estimate and execution. You are also responsible for any blockchain processing fees associated with your transaction, which will show up on your bill at the end. American customers are also limited in how much they can deposit at first, though these restrictions get lifted once you’ve been using the site for one full month.

The platform’s transaction fees are 0.5% per trade regardless of value, making it much more affordable than CoinBase without compromising ease of use. Changelly also allows customers to purchase Bitcoin with a credit card to get started, though the associated fees are exorbitant.

4. Gemini

Gemini charges just a quarter of a 1 percent to process any trade, making it extremely affordable. There are also no deposit or withdrawal fees, making it an excellent platform for the investor looking to optimize their ROI. The platform also offers the convenience of linking a bank account to fund your purchases, and even allows new customers to start trading before their first deposit clears (though you can’t cash out until it does).

Unfortunately, Gemini only supports Bitcoin and Ethereum, a selection worse than that of CoinBase. There is also a weekly spending cap of $500 that cannot be circumvented, limiting how aggressive investors may be when they see a price they like. Still, Gemini is a great exchange if you think you can live with these downsides.

5. Kraken

If you’ve ever dabbled in the stock market, Kraken’s forex-styled interface will seem immediately familiar to you. Like Changelly, you select the coin you want to spend, another that you want to buy, and create a “trading pair” to complete the transaction. Fees vary based on the trading pair, but they average around .36%. Kraken also has 16 tokens to choose from, adding Monero, Z-Cash, and Dash to the usual suspects such as Bitcoin and Ethereum.

Kraken also offers advanced trading options geared to the experienced crypto trader, including stop limits, leverage trades, and conditional closes. However, all of these features make for an intimidating interface that newcomers may do well to avoid.

You can fund your crypto transactions with a bank account on Kraken, but you can’t trade until your first deposit clears (usually one to five business days). There is no way to lock in current pricing in the interim, so you may miss out on an opportunity while you wait. Some users also report difficulty in setting an account up, adding to the time it takes to get trading.

6. Bittrex

Like Kraken, Bittrex uses a forex interface that new users may find confusing. Unlike Kraken, there is no way to purchase cryptocurrency using fiat currency on the site. That means that new users must transfer tokens purchased on another exchange (such as those listed above) to use Bittrex at all.

Dealing with those inconveniences allows you to choose from over 190 tokens, making this a great place to stock up on any altcoin that might interest you. Transaction fees depend on your trading pair, but they are generally cheap enough to avoid becoming an issue.

7. Binance

Binance is a cryptocurrency exchange trading hundreds of cryptocurrencies and is considered the largest cryptocurrency exchange in the world when it comes to trading volume. Binance offers a simple or more advanced trading platform view depending on your level with great customer support.  Binance is capable of processing 1,400,000 orders per second, compatible with all devices, multi-coin support, and a multi-tier security setup process.

The Final Word

All six of the exchanges above are ideal for somebody, as each caters to a different customer.  Explore the various cryptocurrency exchanges learning the Bitcoin value, trends, the perks of each exchange and see what fits you best. If you know what your needs as a crypto investor are, you should be able to use the information above to determine which cryptocurrency exchange is right for you.