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The Leading Cryptocurrency Exchanges of All Time

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day trading cryptocurrency and the difference between short term and long term crypto investments

The world today, as we know it, is benefiting greatly from harnessing the power of cryptocurrencies. Unlike traditional financial systems, these digital currencies are easily exchanged with the help of cryptocurrency exchanges.

Banks and financial institutions also offer exchange services; however, traders cite specific problems such as high trading fees and slow exchange operations. On top of that, banks put users at risk of manipulation despite acting as the primary link between traders.

Luckily, some of the most prominent exchanges plan on going public through an Initial Public Offering. This move could mark the beginning of a new crypto trading era as the exchanges go through the public listing process. However, specific considerations must be reflected to select the most appropriate exchange platform, as described below.

Features to Look out for When Selecting an Exchange

Charges

An investor must determine the network’s fees before embarking on any trading activity. Unfortunately, exchange platforms sometimes offer unreasonable prices for executing even the most minor transactions.

Security

Ideally, no trader would want to engage with a platform lacking security features. Otherwise, users would lose all their money since the exchange can be easily breached. Therefore, watching for security aspects such as cold storage options, identity verification procedures, and many more is advisable.

Liquidity Rates

Liquidity refers to the amount of money an exchange can raise instantly. As a result, companies and business entities with a stable liquidity rate can fulfill most of their financial obligations and improve their economic status. 

The same concept extends to exchange ecosystems because a higher liquidity amount equally results in a higher trading volume. Furthermore, a higher liquidity rate facilitates fast transaction operations. 

The Most Convenient Crypto Exchange Platforms

Dozens of cryptocurrency exchanges exist today, running on a centralized and decentralized basis.

Centralized Exchanges

As the same suggests, centralized exchanges operate in a central location. Platforms under a centralized architecture usually have one primary server which connects millions of traders by matching orders. 

In most cases, centralized exchanges adopt a regular organization’s approach whereby the platforms are lawfully registered and contain their corporate structure.

Binance

Founded in mid-2017,  Binance is currently the world’s most-used cryptocurrency exchange. It runs on a centralized system offering fiat-to-crypto and crypto-to-crypto exchange services. By the end of 2020, Binance revealed its milestone report displaying $3.88 billion in trading volumes, an increase of 36%. 

Moreover, the report records an increase in the number of trading pairs and tokens, 591 and 184, respectively. The Binance team gives the ultimate support and creates an interactive environment for its users, particularly newbies enthusiastic about the crypto trading venture. 

Since the exchange is a licensed company, users enjoy the benefits of consumer protection. It further deploys heavy security measures such as 2FA and SAFU insurance to safeguard traders against financial losses.

Kraken

Similar to Binance’s services, Kraken integrates trades between fiat and cryptocurrencies. The exchange operates on a modernized interface handling three segments: simple, intermediate, and advanced. 

Kraken consists of dark pool features, an impressive way that ensures transactions remain private for the trading participants. Furthermore, it hosts fiat currencies such as EUR, JPY, USD, and CAD. On the other hand, the platform contains 50 cryptocurrencies listed for trading. 

Kraken’s liquidity rates are relatively higher; however, its trading fees are slightly complicated as it utilizes the maker-taker approach. Nevertheless, the exchange promises traders a secure option because it stores 95% of its funds in cold storage wallets.

Decentralized Exchanges

Decentralized exchanges work differently from centralized exchanges. Decentralized exchanges, commonly known as DEXs, ensure users retain control over their funds. Additionally, these platforms do not have any governing entity or third-party interventions.

Uniswap

Uniswap has seen massive strides in the decentralized finance sector and has gained more popularity, especially in its non-complex token listing procedures. For example, the platform allows traders to seamlessly swap ERC-20 tokens in a trustless manner.

Uniswap runs on the ethereum blockchain hosting some of the hottest digital tokens, such as WBTC and Aave. The DEX ecosystem charges a 0.3% fee on all trades, later used to pay liquidity providers depending on their contributions. 

Smart contract advancements fuel every transaction operation on Uniswap as it self-executes every trade between users. In addition, the platform maintains the utmost anonymity levels because all trades occur through a trader’s wallet, eliminating any KYC/AML procedures.

Curve

Curve Finance is a DEX platform offering the best earning opportunity by merely depositing. To be precise, Curve provides a 300% return on deposits, making it a unique platform in the market to profit off traders via deposits. 

Additionally, the ecosystem experiences minimal losses as it swaps a trader’s digital assets with stablecoins. Therefore, this move mitigates the risks of financial losses due to the unstable nature of cryptocurrencies.

It contains numerous pools, with each pool supporting different types of cryptocurrencies. Then, investors leverage those digital currencies to add liquidity to the pools and generate profits from them.

Security concerns are well catered for by integrating the best encryption tactics to secure a user’s funds and transactions.

IDEX

IDEX exchange rolled out in 2018 under the Aurora Project, a group of ethereum applications supporting a decentralized banking model. Its security architecture allows for private key encryptions and HTTPS technologies. 

The platform’s functionalities introduce features such as trading view charts and wallet encryptions, operating on a comfortable and well-laid-out system. Furthermore, IDEX deals with ethereum and ERC-20 tokens, including DigitalBits, Celsius, Etherbase Coin, Quant, to mention a few.

Trading fees are based on two segments, namely, takers and makers. IDEX makers formulate new trades in the order books and attract a 0.1% fee. On the other hand, takers utilize existing orders in the books while removing liquidity and incur a trading fee of 0.2%.

1inch Exchange

1inch Exchange is a prominent DEX aggregator utilizing smart contract technologies to oversee transaction operations. Traders on inch have the ultimate control of their funds located in their ERC-20 wallets.

Therefore, its non-custodial mechanism allows users to enjoy trading freedom without requiring any registration procedure. Withdrawal services are free; however, 1inch Exchange came up with CHI gas tokens to reduce transactional fee payments by 42%.

Examples of digital wallets that the DEX utilizes include MetaMask, Wallet Link, Trust Wallet, and Portis. The fact that the DEX runs as a non-custodial platform makes it a secure trading ground for many. 

So far, the platform has experienced no data breaches because no one has given out any of his/her personal information. Its native token (1inch Token) enables the token owners to participate in governance activities and access more funds to expand the exchange network.

Conclusion

The emergence of crypto exchanges links the traditional financial system and the current digital currency era. Users on the centralized side delight in a regulated ecosystem’s benefits of complying with the set laws and guidelines. 

Meanwhile, DEX users find it convenient to utilize the power of anonymity and freedom over their funds. Therefore, despite the duo having different setups, they provide a shared service type, including exchanging digital currencies. 

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It is advisable to conduct extensive research on the exchanges you might feel match your trading needs.

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