Cryptocurrency is climbing the peaks of value worldwide. By sensing the promising future of crypto, new crypto exchanges are kicking off every day. Choosing the best and most secure cryptocurrency exchange is crucial before trading cryptocurrencies. If you plan to invest funds by trading in crypto, you need to consider these features while choosing your australian cryptocurrency exchange.
- Fees:
Almost every exchange charges a small commission fee for each trade made by the trader. The fees may vary with the exchange, but it’s always almost charged based on a certain percentage of each trade. Unlike investors, traders buy and sell more frequently. Hence fees become a crucial factor while choosing the exchange or wallet.
- Asset Selection
Top digital assets such as Bitcoin, Ethereum (ETH), and Litecoin (LTC) are available on all major exchanges, but they sometimes miss out on smaller assets. Hence make sure the exchange you choose offers the digital asset you want to trade or invest.
- Prices
The prices of the assets also vary across the exchanges. The participant location, volume, and other factors decide the digital asset price. So consider the prices of assets while choosing your exchange.
- Volume
Trading platforms also differ based on the volume they can handle. The number of participants using the platform and the amount of each traded asset decide the exchange volume. Volume decides how easily and quickly a trader can enter or exit a position while trading cryptocurrencies. For example: If a trader wants to sell 100 ETH, a low-volume platform will not support that as there will not be enough sellers at the current market price. It will force the trader to sell to lower offers.
- Leverage Trading
Derivative exchanges offer leverage trading, which allows the traders to borrow a certain amount of funds for trades based on the funds they have on the platform. Leverage may be necessary for traders who want to enter short-term positions with a larger size.
- Fiat Exchange
A fiat exchange allows the trader to transfer national currencies in and out of the exchange. Different exchanges have different fiat options for the various banks. Checking whether it supports your banking options and which fiat currency you can exchange is essential for smoother transactions.
- Insurance Fund
Some exchanges have insurance funds to compensate the traders under particular circumstances. Checking whether the exchange has an insurance fund or not can be crucial for many. The Federal Deposit Insurance Corporation (FDIC) covers many exchanges which protect a specified amount of U.S. users’ funds.
- Security
The security of your asset is one of the most important things to consider while choosing your crypto wallet. Understand what security methods the exchanges use to secure traders’ assets.
Most exchanges are secured with 2 Factor Authentication(2FA) for more security. An exchange with no 2FA is not considered safe according to today’s safety standards.
- Reputation
There are many crypto platforms that the trader can quickly get confused about. Checking the reputation of the platform will ensure its safety and authenticity. Do background checks and research for any previous malicious activity or scams around the exchange.
- KYC/AML
Users are asked to follow Know Your Customer (KYC) and Anti-Money Laundering (AML) practices that ask them to submit personal information about themselves during account creation. These requirements may vary for other exchanges, so make sure you understand what information you provide them.
Finding a perfect exchange for trading cryptocurrencies is now easier. All you have to do is look out for these ten things while choosing your crypto exchange.
