Best Cryptocurrency Exchanges for united states

What Are Exchanges & Why Are They Needed?

Cryptocurrency exchanges are marketplaces where you can trade financial instruments such as digital and fiat currencies. Every crypto exchange serves as a matchmaking service between buyers and sellers. The function of these platforms is to ensure that transactions are performed in a fair and orderly manner.

Unlike stock exchanges that have limited trading hours, crypto exchanges are active and available 24 hours per day, 7 days a week. This means you can log on and make transactions at any time you find suitable. Besides serving as a platform for companies to sell securities to investors, exchanges allow customers to easily trade one cryptocurrency for another.

Cryptocurrency exchanges are not the same thing as crypto wallets. Wallets are designed to place and store digital currencies in a secure environment, whereas exchanges serve as trading platforms. However, some of the more advanced crypto exchanges also offer a wallet along with other convenient features.

All crypto exchanges charge different fees based on your transactions. These are usually small percentage fees known as volume-based fees. You might also come across currency conversion fees if you choose to deposit a currency that is not originally accepted by your chosen exchange service. While all exchanges charge fees, not all fees are the same. That is why you might want to research multiple exchanges before settling for one.

Even though cryptocurrencies are becoming more and more popular, they have not yet gone mainstream. In particular not all services and companies will accept cryptocurrency as a valid payment method. That is why we need exchanges that allow us to trade the cryptocurrencies we have for fiat money or a different digital currency. Besides exchanging currencies for the sake of making payments, users can trade crypto assets for profit as well.

How Do Exchanges Work?

Deposit

The first step to making a transaction on an exchange is to create an account and deposit your financial assets. To make a transaction, you can either deposit your local currency or any other cryptocurrency you own.

Keep in mind that depositing currencies that are not accepted by the exchange will trigger some extra fees (research the specific exchange you’re using to learn more about additional fees). Depending on the platform you chose, you will have multiple deposit options at hand, including bank transfer, debit or credit card transaction, or even PayPal.

Buying and Selling

Once you’ve made a deposit to your account, you can start the first transaction. For example, let’s say you’re looking to purchase some Bitcoin. First you need to place a “buy order” and request to buy Bitcoin for anything at or below its current price. Meanwhile, sellers on the platform will place “sell orders” where they ask to sell Bitcoin for anything at or above the minimum price.

The platform then acts as a matchmaking service by connecting you to the seller who is most compatible with your requirements. Upon placement, all buy and sell orders are located in the exchange’s “order book.” This list includes information about buyers, sellers, and their asking prices. The exchange will automatically provide details about sellers who fit your requirements so you can choose whether or not to close the transaction.

Fees

As we have already mentioned, all cryptocurrency exchanges charge certain fees per transaction. The fees depend on multiple factors, including transaction size, volume, and currency that is being exchanged. Depending on the platform you choose, you might come across additional fees and expenses.

As mentioned above, Exchanges are not the ones setting the pricing. Instead, each seller requests their own exchange prices, which is why you will see different pricing on different platforms. Hence, doing research before making a transaction is advisable if you want to get the best deal.

Verification

Most reputable exchange platforms will require a certain level of verification before a user is able to participate in transactions. While some exchanges require as little as simple email verification, others might look for more detailed information about your identity and location.

The most common type of verification you will be required to complete is the ID verification. In this case, you will be asked to upload a photo of your passport or any other identification document for the sake of verifying your identity. Even though this process might seem like a hassle, the process is usually relatively hassle free and will get resolved within a few hours or at most a day.

Withdrawal

After buying some crypto, you can either keep it on your account or withdraw it to a "safer location". You can choose to make a withdrawal either to your bank account if fiat or to another crypto wallet if crypto. Transaction and withdrawal fees will be calculated based on each platform’s fee policies.

Depending on the platform you chose, there might be a certain withdrawal threshold you must reach before being able to transfer your digital assets. You can learn more about fees and thresholds by researching the exchanges you are interested in. Overall, the withdrawal process is usually intuitive and specific to each exchange.

What Are the Key Differences between Exchanges & How to Decide Which One Is Suitable For You?

Choosing the right exchange service for your needs might be a challenge, especially if you’re new to exchanging digital currencies. Here are some of the key points that will help you decide which platform is the best option for you.

Countries Allowed

Some exchanges don’t accept deposits and transactions from all locations in the world. Before you settle for one platform, make sure to look at the list of countries and locations they support to avoid any issues with future transactions. You can filter exchanges by country using our search tools.

Deposit Methods

Deposit and withdrawal methods are another key factor when it comes to choosing a suitable exchange. Available deposit methods differ from one platform to another. Hence, you might not be able to make debit or credit card deposits on all crypto exchange platforms out there. Some exchanges offer additional options such as PayPal, which can come in handy if you prefer that method of transaction. Use our search tools to identify which exchanges support your chosen deposit method

Range of Coins

Not all exchange platforms offer the same selection of coins you can sell or purchase. If you are looking to make exchanges beyond the most popular cryptocurrencies, you might want to look for exchange services with a wider variety of coins in their ecosystem. As of right now, Binance has the best variety of coins to offer.

Security

Even the most reputable cryptocurrency exchanges can easily become targets for large cybersecurity attacks. Hackers are actively trying to steal digital assets from exchange platforms through various threats which put your hard-earned money at risk. On top of practicing cybersecurity measures on your own devices, make sure to look for an exchange platform that places emphasis on security. It is best to keep your digital assets in “cold storage,” that is, wallets that are not connected to the internet. This makes them more difficult to access and thus much more reliable.

Volume

Iti is generally advised to look for crypto exchanges with a higher trading volume for the sake of getting better and more relevant pricing. As we’ve already explained, the prices of digital assets differ from one platform to another. For example, there is no set price for Bitcoin. Instead, the price depends on the volume of traders on the platform and what prices they are setting. The bigger the exchange, the higher the "competition" and thus the better market-price.

Centralized vs Decentralized

Paypal is a great example of a centralized service, that is, a service that is run by a company that collects revenue from the platform’s operation. Many exchanges are also centralized like this also with a single company and owner in overall control

Decentralized exchanges, on the other hand, operate without a central authority. What this means is that decentralized exchanges allow peer-to-peer transactions in a much safer, blockchain-based environment. While there are pros and cons to each option, decentralized exchanges provide better security, whereas centralized exchanges offer more support that the essentially self service nature of decentralized versions.

Mobile App

Reliable crypto exchanges usually have a mobile app that you can use on the go. An app can come in handy if you need to make quick transactions or check the pricing without having to use a desktop device. Some mobile apps allow you to perform all trading actions from your phone, which is a great plus for those who appreciate accessibility and convenience. If having access to a trading platform on the go is something you find necessary, make sure to choose an exchange that offers a reliable mobile application.

Complexity of Site

If you are new to trading cryptocurrency, it is important to look for a beginner-friendly site to get started. Some exchange platforms are so complicated that even a seasoned trader might get lost in all the nooks and crannies of the site. Therefore, make sure to check the complexity of the platform before diving deeper into the transaction. Look for intuitive sites with a simple user-friendly design to avoid any unwanted hassle.

Advanced Features

Last but not least, if you are more advanced than an average crypto trading beginner, you might want to look for platforms that offer more advanced features such as margin trading. Advanced crypto exchanges allow you to trade assets through third party funds through the margin trading feature. However, make sure you have the knowledge and experience needed for this type of trading before you dive into any advanced features.

What Are the Risks of Using an Exchange?

Hacking

As with any digital service, there is always going to be a certain level of risk that leads to serious cybersecurity threats. Since crypto exchanges move and store large amounts of financial assets, they have become quite an attractive target for cyber criminals around the world. That makes security one of the biggest concerns tied to crypto trading.

The bad news is that no crypto exchange is fully bulletproof. Even though all reputable exchanges focus on maintaining high security levels, there will always be a certain level of risk tied to making online transactions, however in the past many have refunded affected users and tightened up their security keeping all but a bare minimum offline and inaccessible to hackers.

Still, you should check whether the platform you are interested in is following the right security procedures and whether they can guarantee full security for your assets.

Not controlling your coins

Being able to control and safeguard your money without banks, governments or anyone else being able to change it is one of the attractions of cryptocurrency for many.

Another risk tied to using crypto exchanges is the fact that you cannot actually control your coins until they are withdrawn to your wallet or bank account (although technically you dont control your bank account either you trust the bank). Even though you can let your coins sit in the exchange for as long as you’d like, this is not a very good idea. The main reason behind this is that you don’t actually have the coins in your custody before you withdraw them.

These temporary exchange wallets are considered “hot wallets” and they are not the safest place to permanently store your digital assets. Instead, it is better to transfer your currencies to a “cold wallet” which is not connected to the internet. This kind of offline wallet will keep your coins safe by making them inaccessible through online networks.

You should avoid letting your coins sit in the exchange for an extended period because, you do not have full ownership over those assets. Therefore, make sure to transfer them to a wallet under your control right after the transaction.