Choosing the best crypto exchange can be a complicated process.
First and foremost, you want a safe exchange. As crypto has become more popular and desirable, it has become an increasingly large target for hackers, and tens of millions of dollars have been recently hacked into many leading exchanges, including the international operations of Binance and KuCoin.
While exchanges often reimburse those whose coins have been stolen by their insurance, you probably don’t want to be in that position. That is why it is important that you only invest your money in reputable exchanges.
You can minimize your risk by spreading your crypto purchases across multiple exchanges or by moving your crypto from an exchange’s standard wallet to your own secure “cold” wallet that is not connected to the internet (and therefore much more difficult to hack although you have to keep up with your passcode or you could lose access to your cryptocurrency forever, he notes. However, you also need to watch out for withdrawal fees when removing crypto from an exchange. These often vary depending on the type of coin.
Also take into account the cryptocurrencies available on a particular exchange. You can use a crypto exchange with just one coin if it’s the only coin you want. Conversely, if you’re a crypto fan you might want access to all of the 600+ available on Gate.io.
But the mere availability of coins is not enough when there are no trades. Ideally, you’d want to see hundreds of millions of pounds of crypto trading every day to make sure you have enough liquidity to easily trade your coins and pounds sterling when you want or need to.
If you’re an advanced crypto trader, you may want to make sure that your preferred exchange offers the types of trading you want – like limit orders, which can prevent slippage by setting a hard price – and the margin you want. Keep in mind that types of trading in the latter are still evolving, so the offers on the different exchanges may vary over time.
If you are just starting out in buying cryptocurrencies, look for an easy-to-use platform with extensive educational resources to help you understand this complex, rapidly evolving commodity.
And don’t forget the fees. You may be okay with paying a premium for a simple user interface if you’re still familiar with the basics, but higher fees weigh down your potential returns. High-frequency traders in particular want to reduce costs.
Finally, don’t assume that there is an exchange available in the UK just because you can access the website.