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Crypto exchanges: What are they and how do they work?

Everywhere you go, you would always hear people discussing the latest cryptocurrency news. This goes to show that this is a popular topic, especially in the financial industry. As more people find out about its wonders, their curiosity about owning crypto also increases. However, one thing that stops most of them from diving deeper into the crypto world is due to its intimidating factor.

In a general sense, a lot of people believe that it is quite hard to own a digital coin or token. Aside from that, the highfalutin words of the crypto world are hard to grasp, especially for beginners, which is one of the reasons for discouragement. 

As a solution to this, a platform was built to allow crypto users as well as enthusiasts to easily access their preferred coin or token. This comes in the form of crypto exchanges, which you’ll learn more about as you continue reading. 

Crypto exchanges and their role in the crypto world

Crypto exchanges, in their most simplified form, are a platform or avenue for people to trade, buy and sell coins and tokens. This gives users a gateway to have access to the cryptocurrencies they need since using an exchange is not complicated. The best part about this is that everyone can sign up and become a trader! 

With crypto exchanges, it is easier for beginners to jumpstart their crypto journey because they can use fiat currencies for trading. All they have to do is look for their desired digital coin or token on the exchange. From there, they can choose whatever works best for them. 

Besides trading, crypto changes are also an avenue for learning. The ones who run these platforms would provide blog articles, tips or notes about everything a beginner should know about crypto. Here, you will learn the different aspects of crypto such as technical jargon and market trends to watch out for.

Choosing the right crypto exchange for you

Given the high popularity of digital currencies, it is only right to see a lot of crypto exchanges you can sign up for. However, this can be tricky because some might have benefits that others lack. With that being said, here are some things to keep in mind when choosing the right crypto exchange:

  1. Coins offered

The first thing you should check in crypto exchanges is the number of coins or tokens they offer. If you see a lot of options, you can begin investing in altcoins that have yet to reach their peak all the while maintaining the big league coins such as Bitcoin and Ethereum. Make sure to do some research on the coins or tokens to invest in the kind that suits your preferences. 

  1. Security

The next thing you should check is the crypto exchange’s security measures. Since cryptocurrencies are decentralised, you need to keep in mind that there is no single governing entity that watches the overall transactions. This means that your coins and tokens are not protected the same way banks safeguard your fiat currencies.

With this in mind, you need to look for a crypto exchange that has insurance policies to protect your digital currencies. Aside from that, it is recommended to do some research about the kind of security they offer so you’ll have peace of mind. 

For extra measure, check the reviews of its users to see if the crypto exchange provides a great customer experience.

  1. Accessibility

Another important thing to look out for is the accessibility of crypto exchanges. Unfortunately, not all countries allow you to participate in trading on these platforms due to national regulations. To determine a crypto exchange’s geographical limitations, you can visit their website to see the list of countries that allow their services.  

  1. Fees

Like banks, crypto exchanges also ask for fees to keep their systems running. These can vary from one platform to another, but you should not be discouraged in case you encounter high transaction fees. Usually, crypto exchanges with high fees make it easier for you to buy the crypto you want, which goes to show that you are also paying for convenience. At the end of the day, you need to check how the fees work in crypto exchanges before signing up to make sure they fit your preferences. 

  1. Educational tools

Choose a crypto exchange that provides you with educational resources. Having more information will further deepen your knowledge of cryptocurrency and use it to your advantage. Moreover, educational tools are important for beginners because these will serve as guides on how to navigate across the platform.

The top crypto exchanges today

Now that you know how to choose the right trading platform, here is a list of the high ranking crypto exchanges today:

  1. Binance

The leading crypto exchange in the crypto market is none other than Binance. This platform is famous for its high cybersecurity and wide range of cryptocurrencies available for trading. Most importantly, Binance helps beginners and other first-timers navigate through its user-friendly interface, which makes it a go-to for both beginners and experienced users.

  1. Coinbase

Coinbase is the favourite crypto exchange platform among beginners because of its easy-to-navigate interface. Aside from that, this platform has a lot of good reviews among its users, and most of them claim that the security is safe and well-guarded. Additionally, Coinbase is famous for its educational blogs that tackle topics about everything related to crypto, helping you understand more about it. 

  1. Kraken

During the rise of cryptocurrency, Kraken was one of the oldest trading platforms developed in 2011. It offers around 90 digital currencies and also has low fees for transactions, perfect for users looking for a suitable cryptocurrency. However, Kraken is more attractive to advanced users because of its sophisticated trading features. Nevertheless, the crypto exchange also entertains newcomers to its platform.

All of these crypto exchanges can be accessed online. If you want to start your cryptocurrency trading journey, consider choosing from these platforms to have smooth transactions. You just need to sign up to create an account and participate in trading. 

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