Best Cryptocurrency Exchange – A Beginners Guide


Before the time of online crypto currency exchanges, there was a bitcoin era where coins were somewhat hard to come by. Paying a bar tab with bitcoins was actively discussed on a recent NPR episode I listened to. I used to joke about paying for Pizza's in Bitcoin.  I guess I can't anymore and neither can you.  Mark Cuban tweeted he’d allow people to pay for items at Mavericks games with cryptocurrency. At this point the industry is mainstream.  While you can’t invest like the sharpshooters of before, it is fairly easy to get your hands on cryptocurrency now, and we highly recommend you do.  It looks like it's here to stay. Cryptocurrency exchanges have become somewhat of a daily topic of conversation.  

What is a Cryptocurrency Exchange?

Much like international currency exchanges that you see when you are traveling, cryptocurrency has exchange rates in crypto.  Much as Yen is exchanged to US dollars, crypto exchanges for other larger and smaller crypto.  Of course using companies like Coinbase are integral to getting your national currency in or out of the crypto world.  We also have exchanges like Binance, one of the top cryptocurrency exchanges in the world.  It uses Bitcoin, Ethereum, BitcoinCash, and Litecoin as benchmarks for value.  With these values established, you can trade other smaller currencies.  We have an article about how to trade into Coinbase and Binance here.

Types of Exchanges

There are two main categories of cryptocurrency exchanges:

Online Exchanges: Online exchanges make up a majority of the cryptocurrency exchanges and crypto trades on the market.  They are most competitive for investors due to their expanded reach with mobile devices, as well as 24 hour investment capabilities.  They are often times fully available from your mobile device. These exchanges are hosted in certain countries and their reach can be global or country specific due to financial regulations. The main draw of online cryptocurrency exchanges is the relative simplicity and ease with which a buyer can purchase a cryptocurrency.  A wide range of payment options are available for users depending on exchange.  These can include anything from Credit Cards to Bank Transfers.

Offline Exchanges: Offline exchanges are cryptocurrency exchanges that run their services completely offline.  Their websites display prices only as a showroom.  They have no online financial functionality. Offline Exchanges are walk-in only exchanges where the customer has to physically present themselves before they are sold the digital cash. Offline exchanges have a crucial advantage over online exchanges. They are considered much safer from hacks or cyber intrusion, and are ideal for big volume cryptocurrency buyers.  If you're looking for one of these, do your research and make sure the choice is legitimate.  Ask for references of current investors if your feel uncomfortable.  Like a good drug dealer, offline exchanges are reliable with reputation.  Always be careful of new offline exchanges that don't have a good reputation or a reputation at all.  They could be looking to scam.

What Makes a Great Cryptocurrency Exchange?

There is huge competition amongst cryptocurrencies.  Their is also a heated battle going on with exchanges. Choosing the right exchange that will work depends on a variety of things.

Registration Process:  Cryptocurrency exchanges differ from one another in the length and difficulty an investor goes through before registering.  Getting verified to begin buying crypto holdings can be easy or extremely difficult. This should be a major consideration as you choose an exchange.  Read reviews.  We have a breakdown of what registrations look like throughout this website.  We highly recommend looking around more and understanding what you're getting into.  With any investment, we want to make sure our money is in the safest places and that we feel comfortable with what we are investing in.  The exchange should be examined as carefully as the crypto, stock, company, ring, relationship, or whatever you're committing funds to.

Means of Payment:  Verification technology has allowed many cryptocurrency exchanges to accept credit card payments, debits, and bank account deposits. Deposit caps and restrictions can be a major burden for the prospective investor, so make sure you verify to allow maximum deposit and ROI if it's what you want.  Coinbase normally starts investors at a $5,000 deposit cap on new activity.  With more frequent activity this can scale to $100,000 per week.

Security Features:  Most of the cryptocurrency exchanges claim that they are highly secure.  Unfortunately, we have seen exploitations that have brought fear to the space.  These hacks often result in short term sell offs and have caused several bankruptcies and financial damage. In order to choose the best exchange, check on its reputation and modes of storage. Exchanges like Coinbase store their holdings in completely offline vaults.  This is among the reasons it’s among the most reputable exchanges offering exclusive coins.

Coinbase just became the #1 download application on iTunes.  Check out a more detailed article on where you can deposit to exchanges via credit card here.