Choosing a platform to buy and sell your cryptocurrency. Examining these details will assist you in making an informed decision about whom to trust with your hard-earned money.
To start, what exactly is an exchange?
An exchange is a platform where you can buy and sell cryptocurrencies.
This can be compared to traditional stock exchanges like the NASDAQ or New York Stock Exchange, but instead of trading shares, you’re trading cryptocurrencies on these platforms. It’s important to note that trading cryptocurrencies isn’t confined to a single exchange – you have the option to trade across multiple platforms.
We can distill this concept into an age-old idiom: ‘Different strokes for different folks.’ With this in mind, let’s delve into the differences among the various platforms you can use to buy or sell cryptocurrencies.
We identify three distinct types: a Cryptocurrency Broker, a Cryptocurrency Exchange, and a Decentralized Exchange (also known as a DEX).
A Cryptocurrency Exchange is a platform where multiple buyers and sellers converge. Here, buyers and sellers have the freedom to buy or sell at any price, but transactions are only completed when another party agrees to the proposed price.
Exchanges are generally recommended for advanced users who possess a basic knowledge of trading. If you’re already familiar with trading concepts and are keen to explore a variety of markets, exchanges could be an ideal fit.
Buy your cryptocurrrency now at 3 of our most trusted exchanges
A Cryptocurrency Broker is an organization where you can buy or sell cryptocurrency at a price and fee set by the broker itself. While their prices are generally in line with those of their competitors, users transact directly with the broker. Think about a lemon stand where everyone buys from one seller, the broker.
These brokers maintain large quantities of cryptocurrency to adequately supply their users. They are often considered an excellent starting point for beginners due to their user-friendly environment, especially for those who wish to buy Bitcoin or other cryptocurrencies in relatively ‘small’ quantities.
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The two platforms described above are centralized entities that have control over your cryptocurrencies. They can limit withdrawals and dictate what can be traded.
However, in alignment with the decentralized vision of the blockchain movement, a new type of exchange has emerged: the Decentralized Exchange, also known as a DEX.
A DEX is an exchange where no central party governs transactions, holds your crypto, or can be shut down. Instead of yielding power to a centralized entity, transactions occur directly through the code of smart contracts.
Though the workings of a decentralized exchange are not that complicated, a bigger amount of knowledge is necessary and maybe not suited for newbies. Learn more about here.
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Broker | Exchange | DEX | |
User-Friendly | ✅ | ✅ | ❌ |
Buying with Fiat | ✅ | ✅ | ❌ |
Selling into Fiat | ✅ | ✅ | ❌ |
Level | Beginner | Advanced | Advanced |
Most Used? | #3 | #1 | #2 |
Who owns the keys? | Third-Party | Third-Party | You |
Using an exchange doesn't necessarily make you the owner of your cryptocurrency; it merely grants you access to your crypto wallet. If the exchange ceases to exist, your coins will too.
Below is a selection of the most reputable and popular cryptocurrency exchanges compiled in one convenient overview.
By clicking on ‘Check Out the Exchange’, you’ll access detailed information about specifics such as ‘how to use the exchange’, ‘how to log in’, ‘exchange reviews’, and more.
Using an exchange doesn't necessarily make you the owner of your cryptocurrency; it merely grants you access to your crypto wallet. If the exchange ceases to exist, your coins will too.
Now that you have a starting point for buying or selling cryptocurrency, you can continue on your journey. The next crucial step is to educate yourself thoroughly. Remember, if you aim to make money in this industry, constant improvement and education are key. 👇
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