Crypto Trading 101: Which exchange should I use? – Steven Shalwitz

So you’re interested in trading some cryptocurrency, great! You might be feeling a little lost, and I don’t blame you, it’s kind of the wild west out there.

The first thing you’re going to have to do is decide on an exchange where you’ll want to buy and sell crypto. There are a lot of choices. I’ll give you some key attributes to look for and then highlight a few exchanges you might want to consider.

Fees: Most exchanges will charge for every transaction that’s made. These fees can vary significantly between exchanges and may depend on what types of trades you’re executing and how much volume you’re trading. All exchanges, or at least any you should consider, will have a clearly listed fee schedule.

Volume: This is the total amount of assets moved on the exchange. To find total volume for an exchange, use a tool like nomics. But you’ll also want to look at the volume of the individual asset that you’re looking to trade directly on the exchange. High volume generally means more trading, which generally means more traders, which means there are more people to fill your orders when you place them.

Security: This is a big one! Your account on an exchange is basically another bank account, so you’ll want to make sure your exchange has strong security. Multi-factor authentication is a must if you’re going to be storing any large sum on an exchange, and most reputable exchanges now require this.

Insurance: But even if your exchange has good security, you just never know. So, you will definitely want to check for any insurance that the exchange provides. This varies significantly from exchange to exchange and may only apply in certain countries. Do your research here!

Reputation: Do some Googling! A lot of exchanges out there are pretty shady. Using a resource like nomics can help you get an idea of whether an exchange is reputable or not.

Now that you have an idea of what to look for in an exchange, let’s highlight a couple here. Please note, though, that not all crypto exchanges are available everywhere. Generally, this is due to regulations on the cryptocurrency market by different countries.

Binance

Binance is the second largest exchange in the world with daily trading volume in the hundreds of millions. Based out of China, Binance offers a lot of crypto assets to trade and is frequently a starting point for new traders. However, if you’re in the US, you will need to use Binance US. Launched in September 2019, Binance US is significantly smaller, but growing.

Coinbase Pro

If you live in the US, then Coinbase is your largest option. But don’t use regular Coinbase, use Coinbase Pro. Coinbase Pro is the FREE trading platform that Coinbase provides for professional trading. For US citizens, you can rest assured that your US Dollars stored on Coinbase are FDIC insured up to $250,000.

A Few More Options

For more advanced traders interested in trading Bitcoin futures, check out FTX. They are relatively new on the scene, but have quickly established a strong reputation in the crypto community.

If you’re looking for a more gamified experience, and you live outside the US, take a look at bybit.

Hopefully this gave you a quick introduction to the wide world of cryptocurrency exchanges. If it was helpful, please follow me here and on twitter and give a few claps!