Crypto is not going off the radar. The community of crypto enthusiasts is spreading like a viral loop, recruiting more and more members every single day. In times when crypto investments are gradually shifting from the privilege of a small group towards an opportunity for all, it’s highly important to learn how to choose where to trade.
Here are some key factors in helping you make this decision:
Rule #1 is to choose a secure and legitimate platform. Crypto investments are not the same as trading on traditional stock exchanges. Cryptocurrency exchanges have almost no fail-safes to protect your funds, and even a small mistake may cause huge losses.
Crypto exchanges should be strong enough to withstand all kinds of security attacks. Measures in place may include 2FA verification, anti-phishing features, password strength measures, and more.
- Volume of trades
The trading volume of any crypto exchange is another key feature to consider before signing up. The higher the volume, the more trustworthy the platform is. Actually, trading volume indicates how many people buy and sell cryptocurrency using this particular exchange.
- Transparency and rating
Transparency is one of the top parameters, defining the crypto exchange’s credibility. Today, you can find all the relevant information about various crypto trading platforms online. You can use the ratings of cryptocurrency exchanges to help support your choice. They usually take into account things like fees charged, liquidity, the list of supported currencies, etc.
Although ratings may help, they are not the cornerstone for your final decision. Make sure you suss out the exchange with the community and clearly understand the platform’s offering.
- Supported tokens
Different exchanges offer a different number of tokens to trade. If you’re looking for a particular token, you’d better go through their offering beforehand.
Another key thing to consider is that only 10% of exchanges allow you to trade in fiat. Therefore, if you don’t have any digital tokens yet, you have to stick to crypto exchanges that operate with cash, such as Coinbase, Bitstamp, etc.
Location is another key thing to watch. If you can’t find out the location of the exchange, it’s a red flag to say “no” and stay away from it. Picking the right jurisdiction is vitally important to save your money in case of any fraudulent activity.
What is next? Tokenised securities
Today, crypto is growing and we have a whole bunch of different crypto exchanges. But is it enough? At the moment, there is a disconnect: crypto investors can’t easily access the world of traditional investments. Real-world assets – like commodities, indices, and stocks – remain closed for crypto holders. Those who want to invest in real assets through crypto are forced to convert their crypto into fiat, which is slow and costly.
The most innovative crypto exchange business is aiming to unite crypto and traditional assets. For now, this problem can be solved through tokenized securities, which mirror the price movement of an underlying, real asset – like a GOOGL share or the price of crude oil – and provide the same chances for profit as traditional assets.
Hopefully, the practice of seamless movement and trading between fiat, crypto, shares, commodities, and indices will define the beginning of a new era for democratized crypto investments.