Once you’ve found one or two that interest you, don’t hesitate to do the rounds and ask the community what they think about them before you start trading there.
There are so many cryptocurrency exchanges out there and you cannot just pick any random one. There are major differences between exchanges and some of them might be more limiting than others. You also have exchanges that are known for being safe while others may have had some issues in the past. This is why you need to do your research before you start trading on any platform. Here are a few tips for beginners looking for a good crypto exchange.
Security
The first thing you have to do is make sure that the exchange you choose is safe and reputable. They need to have multiple authentication methods and allow you to ramp up the security settings on your account. Do not pick a platform that doesn’t allow for 2-factor authentication and make sure that you implement it the minute you sign up.
You also have to look at what they’re doing with cash reserves. You need to look at how much of the currency is in cold storage and what layers of protection they have over these reserves. Most of the assets need to be vaulted and there also needs to be some sort of insurance for them. These are all things you should be able to find out on their website or by asking customer service.
Look at Reviews
Cryptocurrency exchange reviews are a good place to start building a list of potential exchanges to trade on. Most reputable review sites will go above and beyond to make sure that all the sites on their page are legitimate since they have a reputation to preserve. Another good thing about review sites is that you’ll be able to get some information about each platform. This will allow you to see if an exchange is a right fit for the type of trading you want to do.
Check if They Allow for Fiat to Crypto Transfers
A lot of people will be surprised to hear this, but not all cryptocurrency exchanges allow you to transfer fiat for crypto. This is why you need to first determine whether any exchange you want to trade on offers this option. If you find a crypto exchange that does allow for this, then you should consider investing in some stable coins. Stable coins like Tether are accepted on virtually all crypto exchanges but are pegged to the US dollar. This makes them more stable than the vast majority of cryptocurrencies. By holding stablecoins, you won’t have to worry about limitations or losing 30% of your assets overnight.
Coin Selection
Last, but not least, you need to look at the number of cryptocurrencies listed on the exchange. Don’t expect all exchanges to carry the 200+ top crypto there are on the market right now. Some of the exchanges out there only allow for a handful of cryptocurrencies. So, if you want to trade more obscure coins, first check if the exchange allows them.
These are all things first-time traders need to look for when picking a crypto exchange. Once you’ve found one or two that interest you, don’t hesitate to do the rounds and ask the community what they think about them before you start trading there.