Crypto Exchanges for New Investors
Crypto Exchanges for New Investors
So, you decided your life would be better if you invested in crypto, or cryptocurrencies. You have looked on coinmarketap.com and seen some cryptocurrencies which you want to buy, or perhaps joined an ICO (Initial Coin Offering) which you have been following closely, and bought their tokens which are now available on exchanges. What is your next step?
Exchanges are like going through airports. You first have to make your way through a thorough and somewhat annoying KYC (Know Your Customer) security process, which is where you supply proof of who you are by submitting photo ID, and more.
Then the fun starts. On most exchanges your will then need to figure out where to go. Everywhere you look, there are numbers upon numbers, graphs, and buy options that don’t make a bit of sense to anyone who is not an experienced stock trader.
There are things you will learn on your journey, such as exchanges regularly have to undergo maintenance to protect the integrity of their data, so you will see that the deposits and withdrawals, or gateways, of certain currencies are disabled. It is nothing to worry about, but it will still make you wonder if something went wrong.
In this article we discuss some of the top exchanges which are suitable for new investors, and it will be up to you to decide which one is the least painful to use.
Coinbase is based in the United States
Coinbase is hardly an exchange at all. It functions mainly as a way to convert money from your bank account or credit card, into one of four of the biggest and most well-known currencies: Bitcoin, Ethereum, Bitcoin Cash, and Litecoin. From there, you can transfer these currencies to other exchanges, to buy “altcoins”, and there are over 1500 coins out there.
Altcoin is a combination of two words: ‘alt’ and ‘coin’; alt is the abbreviation for the word alternative, and ‘coin’ denotes currency. Together they cover the category of cryptocurrencies that are alternatives to Bitcoin. These concern all coins and tokens that came after the initial release of the famous Bitcoin, the first decentralized cryptocurrency.
Pros:
- Very easy for anybody to use
- Most popular currencies
- Can use your debit or credit card to purchase (unless your financial institution has blocked it)
Cons:
- Transferring money direct from bank account could take a week. Use debit/credit card for instant availability.
- High fees (3% + miner fees when transferring to external wallet or other exchange)
- No education or research tools
GDAX is based in the United States
GDAX is Coinbase’s sister site, and a more traditional looking exchange. You can trade on GDAX right from your Coinbase balance. It has the same coin menu as Coinbase, which include only Bitcoin, Ethereum, Bitcoin Cash, and Litecoin. The difference is here you can see the graphs and numbers of the market activity.
Pros:
- They have good documentation and help articles, plus an actual phone line for customer support – but there is no telling how busy it may be when you call.
- One of the least scary interfaces for a first-time user
- Able to purchase cryptocurrency with your debit or credit card at a lower fee than on Coinbase.
Cons:
- Limited selection of coins
- No real research tools
Poloniex is based in the United States
Poloniex is a hugely popular exchange, with a decent menu of currencies to buy. Unfortunately, it is so popular, completing the sign-up process can take a week, according to the warning on the sign up page. You must take a photo of your driver’s license, input your social security number or other ID numbers, as requested on the sign up page - and then wait to be approved. And the wait may not end there, as if you have a query about your account, a failed transaction or a trade has gone wrong, customer service is taking a long time to get back to their very valuable clients, who, of course, have no time to wait.
Pros:
- Largest amount of volume (trades) on any exchange in 2017
- Lending, margin trading, and other advanced features
- Security is taken very seriously
Cons:
- No debit/credit cards accepted – you can buy altcoins only with Bitcoin, Ethereum, Monero, and Tether
- Not enough staff to handle customer service, so there are many customer service issues, some which may be quite serious and have been waiting for an answer for what seems a long time
- Cannot begin trading at all until account information is verified
Bittrex is based in the United States
Bittrex is an exchange built by developers who have backgrounds in security, and is one of the few exchanges to have not yet been the victim of a hack. Their currency menu is decent, and the exchange is not too hard to figure out how to use, even for a beginner. As soon as you log in, you can see what’s trending, and a nice clean layout of what you can buy with Bitcoin, Ethereum, or Tether (USDT).
Pros:
- Fast sign-up
- Clean layouts, easier to understand than most other exchanges
- Good selection of coins
Cons:
- No debit/credit cards accepted - buy altcoins with Bitcoin, Ethereum, Tether only
- Registration is closed from time to time, due to a high number of users
- Must have verified identity to withdraw funds.
Binance is based in Japan
Binance is the hottest exchange going right now. It has a fantastic menu of currencies to choose from, and several features not seen in any other exchange (such as tools to help businesses launch their own ICO, get funded, etc.). The interface is a little confusing to users new to dealing with exchanges, but once you figure out a couple of the sites’ quirks, it’s no big deal. The fees are only 1% per trade, or 0.05% if you use their native BNB coin. Withdraw fees are also on a sliding scale, at reasonable rates. It also costs an arm and a leg to have a coin listed on this exchange, so total scam coins are highly unlikely to be found here.
Pros:
- Lowest fees
- Terrific selection of quality coins
- Amazing giveaways (including cars, $1M USD in cash prizes and more)
Cons:
- No debit/credit cards are accepted - you can only buy altcoins with Bitcoin, Ethereum, Binance Coin, and Tether
- Slow response time from customer support (but better than many others)
This is just a small list of all the exchanges out there. Overall, buying crypto for anyone who is not an experienced trader can still be a frustrating experience, but there are many platforms out there that aim to bridge the gap between the financial experts and common man.
Do your research on the exchanges and choose the one that is right for you. You will need to monitor your investment on a regular basis, so the exchange you choose needs to feel like home.